GIFT   OF 


WAR  TRADE  BOARD 

VANCE  C.  McCORMICK,  Chairman 


HISTORY  OF  PRICES  DURING  THE  WAR 

WESLEY  C.  MITCHELL,  Editor  in  Chief 


GOVERNMENT 
CONTROL  OVER  PRICES 


By 
PAUL  WILLARD  GARRETT 

assisted  by 

ISADOR  LUBIN  and  STELLA  STEWART 


Published  by  the  War  Trade  Board  in 
Cooperation  with  the  War  Industries  Board 


WASHINGTON 

GOVERNMENT  PRINTING  OFFICE 
1920 


CONTENTS. 


iT'lit-^The'  cidministrtiti'oit  of  price  controls  during  the  war — Contd. 
2.  The  Food  Administration — Continued. 

(3)   The  administration  of  food  control — Continued. 

Wheat  flour  and  bread — Continued.  Page. 

Producers  generally  satisfied 67 

Stability  of  the  wheat  price  a  reality 68 

Close  relation  of  flour  and  wheat 68 

Control  exercised  over  flour 69 

Control  of  flour  in  1918 70 

Conservation  measures 71 

Results   of  flour   control 72 

Exercising  bread   control 72 

Results  of  bread  control 73 

Summary 74 

Sugar 78 

The  beet-sugar  control 79 

Control   over   the  cane-sugar   supply i 80 

The  distribution  of  refined   sugar 81 

The  Sugar  Equalization  Board 82 

The  limitation  of  sugar  consumption , 84 

Sugar   by-products 85 

The  results  of  sugar  control 86 

Live   stock   and  meats 87 

The  stimulation  of  meat  production 88 

Hog  production 89 

Beef   production 93 

The  licensing  of  the  meat  industry 95 

Licensees  with  annual  sales  exceeding  $100,000,000-  96 
Licensees  with  annual  sales  of  less  than  $100,- 

000,000 97 

The   administration    of  the   license   system   over 

meat 97 

The  results  of  meat  control 99 

Poultry  and  dairy  products 101 

Poultry 101 

Eggs 102 

Butter 103 

Cheese 105 

Milk 105 

Oleomargarine 109 

Cotton  seed  and  cottonseed  products 110 

The  early-price  situation 11O 

The  licensing  of  the  industry 110 

Control  over  the  1918  crop 112 

The  post-armistice  situation 112 

The  effects  of  control- 114 

Canned  and  dried  foods___ 115 

Vegetables , 115 

Canned  fish 117 

Dried  fruits 119 

The  results  of  control 120 

Rice  and  rice  flour 120 

Control  over  the  industry 121 

The  price  agreement  of  the  summer  of  1918 121 


CONTENTS.  O 

PART  II. — The  administration  of  price  controls  during  the  war — Contd. 

2.  The  Food  Administration — Continued. 

(3)   The  administration  of  food  control — Continued.  Page. 

Coarse  grains  and  feedstuffs 123 

Human  foods 123 

The  creation  of  the  Grain  Division 124 

The  limitation  of  coarse  grain  millers'  prices 126 

Feeding   stuffs 

Feeds  other  than  coarse  grains  and  their  products-  127 

Coffee  128 

Governmental  interference ^  128 

The  closing  of  the  coffee  exchange 130 

Collateral  commodities 130 

Ammonia 130 

Ice 131 

Arsenic 

Unlicensed  control  over  commodities  at  retail 134 

Indirect  control  through  licensees 135 

The  organization  of  the  retail  trade 136 

The  consumers'  reports 137 

The  "  fair-price  "  lists -  137 

A  comparison  of  retail  prices 140 

Retail  prices  in  the  United  States  and  Canada 144 

IS  Enforcement  of  the  license  control 145 

The  Enforcement  Division 145 

The  licensee  reports 146 

The  inspection  work 147 

The  Federal  food  administration  in  the  States.—  147 

The  emphasis  upon  publicity 148 

The   centralization    of    Government    and    allied    food 

purchases • 148 

Division  of  coordination  of  purchase 140 

Food  Purchase  Board 150 

3.  The  Fuel  Administration 151 

(1)  The  war-time  rise  in  coal  prices 151 

(2)  The  coal-production  committee 154 

The  1,700,000-ton  Navy  order 155 

The  Peabody-Lane  prices 155 

Their  repudiation  by  Secretary  Baker 158 

(3)  The  food  and  fuel  act 160 

The  power  to  fix  coal  and  coke  prices 160 

Enforcement   provisions 161 

(4)  The  kinds  of  fuel  control r 161 

Organization 162 

Control  over  distribution 162 

Control  over  production • 163 

Control  over  conservation -  165. 

(5)  The  control  over  coal  prices . 165 

Price  fixing  of  bituminous  coal  at  the  mine 166 

Prices  fixed  by  the  President  Aug.  21,  1917 166 

Modifications  made  by  the  Fuel  Administrator—  167 

A  comparison  of  prewar  and  fixed  prices 160 


6  CONTENTS. 

PART  II. — The  administration  of  price  controls  during  the  war — Contd. 

3.  The  Fuel  Administration — Continued. 

(5)  The  control  over  coal  prices — Continued.  Page. 

Price  fixing  of  anthracite  coal  at  the  mine 172 

Prices  fixed  by  the  President 173 

Modifications  made  by  the  Fuel  Administrator 174 

A  comparison  of  prewar  and  fixed  prices -  175 

Control  over  the  prices  of  coal  middlemen 177 

Jobbers'  margins 177 

Distributors'   margins , ..  178 

Control  over  coal  at  retail : 178 

Special  prices,  premiums,  and  charges -  179 

Costs  made  the  basis  of  price-fixing 179 

Bituminous    costs 182 

Anthracite   costs -  184 

(6)  The  control  over  coke 188 

(7)  The  control  over  charcoal 190 

(8)  The  control  over  fuel  wood 190 

(9)  The  control  over  petroleum 191 

The  early  war  situation 191 

The  regulation  of  prices 1 191 

The  licensing  of  the  petroleum  industry 193 

The  gasoline  emergency 194 

Control  and  its  effect  upon  prices 194 

4.  The  War  Industries  Board 195 

(1)  The  development  of  a  control  over  war  industries 195 

The  early  work  of  the  Council  of  National  Defense—  19G 

The  General  Munitions  Board 197 

The  Committee  on  Supplies 200 

The  Committee  on  Raw  Materials,  Minerals,  and 

Metals 201 

The  War  Industries  Board  created  under  the  Council 

of  National  Defense  on  July  28,  1917 202 

The  appointment  of  Chairman  Baruch 203 

The  War  Industries  Board  made  independent  under 

the  Overman  Act  on  May  28,  1918 , 205 

(2)  The  powers  and  policies  of  the  War  Industries  Board 205 

Its  basis  in  law 206 

The  policy  of  Mr.  Baruch 209 

The  organization  of  the  board 210 

The  relation  of  the  board  to  price-fixing 211 

(3)  The  kinds  of  control  exercised 212 

Requirements    213 

Clearances    215 

The  clearance  committee 215 

The  clearance  office 216 

The  clearance  list 217 

Priorities 218 

Authority  for  priority  control 221 

The  priority  circulars 222 

The  method  of  rating 222 

Automatic  rating 223 


CONTENTS.  7 

PART  II. — The  administration  of  price  controls  during  the  war — Contd. 
4.  The  War  Industries  Board — Continued. 

(3)   The  kinds  of  control  exercised — Continued. 

Priorities — Continued.  Page. 
Unifying  priorities  in  production  with  those  in 

delivery 225 

Purposes  demanding  preferential  treatment 225 

The  preference  lists 226 

War-industry  controls  center  about  priorities 228 

Allocations 229 

Curtailments 230 

Conservation 230 

s                            Prices 232 

^<f  5.  The  price-fixing  committee 233 

(1)  Organization  of  the  committee 233 

(2)  The  basis  of  power  to  fix  prices r.  235 

The  threats  of  requisitioning  and  commandeering 235 

The  war-time  spirit 23T 

(3)  Its  sphere  of  activity 237 

Committee  concerned  primarily  with  Government  pur- 
chases   237 

The  committee  fixed  prices  only  upon  request 238 

Fixed  producer  prices 239 

(4)  The  character  of  the  price-fixing  agreements 239 

The  method  of  making  the  agreements ^ 239 

All  prices  were  maximum  prices 240 

Fixed  prices  applicable  alike  to  low  and  high  cost 

producers 240 

Fixed  prices  applicable  alike  to  Government,  allied, 

and  public  purchases 241 

(5)  The  price  policies  of  the  committee 242 

(6)  Administering  committee  decisions 244 

\s    (7)  The   commodities   fixed   in   price  by   the   War   Industries 

Board  and  the  price-fixing  committee 244 

Iron,  steel,  and  their  products 244 

The  runaway  steel  market  in  1917 245 

The  disposition  to  control  iron  and  steel  prices 247 

The  policy  of  the  President  and  his  war  officials 247 

The  Pomerene  bill  in  Congress 249 

The  attitude  of  the  iron  and  steel  industry 250 

Problems    facing    the    Government    in    assuming 

control__ 251 

*-^  Should  control  extend  to  civilian  purchases—  251 

Should  control  extend  to  allied  purchases 251 

L-*     Flat  rate  or  cost  plus  profit  scale 252 

^  Should  higher  contract  prices  already  made  be 

abrogated 253 

Should  the  Government  recognize  the  labor, 

fuel,  and  transportation  problems 253 

Should  account  be  taken  of  the  middlemen 253 

Raw-material  prices  fixed  September  24,  1917 254 

Semi-finished   products  prices   fixed   October   11, 

1917__  264 


8  CONTENTS. 

PART  II. — The  administration  of  price  controls  during  the  war — Contd. 
5.  The  price-fixing  committee — Continued. 

(7)  The   commodities   fixed  in  price  by  the   War   Industries 
Board  and  the  price-fixing  committee — Continued. 
Iron,  steel,  "and  their  products — Continued.  *  Page. 

Finished  product  prices  fixed  November  5,  1917 266 

The    determination    of    differentials    upon    basic 

prices : 267 

Modifications  of  original  basic  prices  fixed 269 

Price  control  and  the  relative  rise,  of  prices  and 

production 270 

Summary 271 

Copper 272 

Copper   production    of    more    concern    than    high 


prices 272 

The  early  allied  purchases 274 

The  allied  purchase  of  77,000,000  pounds 275 

The  early  Government  purchases 275 

The  Government  purchase  of  45,510,000  pounds  in 

March,    1917 276 

The  Government  purchase  of  60,000,000  pounds  in 

June,  1917 276 

Electrolytic  copper  fixed  on  September  21,  1917 278 

The  determination  of  the  Government  to  fix 

the  price  at  22  cents.. 278 

The  copper   interests   ask   for  a   price  of  25 

cents 278 

The  price  fixed  at  23i  cents 281 

Interpretation   of  the  fixed-price  policies 281 

Appeal  of  small   high-cost  producers  for  an   in- 
crease   283 

Electrolytic  copper  increased  to  26  cents  on  July 

2,  1918 283 

Summary 284 

Aluminum 284 

Lead 286 

Zinc 288 

Nickel .  289 

Quicksilver 291 

Tin 291 

Platinum 293 

Cotton  textiles 293 

The  early  need  for  regulation 293 

The  price-fixing  committee  and  the  cotton  industry.  297 

The  fixing  of  cotton-textile  prices 298 

Cotton-yarn  prices 301 

The  proposed  price  revision 301 

Summary 303 

Cotton  linters 304 

Government  control  of  the  linter  crop 306 

The  cotton-linter  pool 306 

The  mattress-linter  pool 308 


CONTENTS.  9 

PART  II. — The  administration  of  price  controls  during  the  war — Contd. 
5.  The  price-fixing  committee — Continued. 

(7)  The  commodities  fixed  in  price  by  the   War   Industries 

Board  and  the  price-fixing  committee — Continued.  page. 

Wool 309 

The  approach  to  regulation 310 

The  adoption  of  a  regulative  policy 313 

The  effects  of  wool  control 316 

Hides,  skins,  and  leather 316 

Cattle  hides 318 

Sheepskins 320 

Tanned  leather . 321' 

Summary 323 

Manila  fiber  and  hemp 324 

Burlap 325 

Lumber 326 

Southern  yellow  pine 326 

Other  soft  woods 329 

Hardwoods 330 

Building  materials 331 

Portland  cement 334 

Common    brick . 336 

Hollow  building  tile 338 

Gypsum  wall  board  and  plaster  board 338 

Sand,  gravel  and  crushed  stone 338 

Chemicals  __ '- 338 

Nitrate  of  soda 338 

Heavy  acids 341 

Sulphuric  acid 341 

Nitric  acid 343 

Conclusion 344 

Sulphur  and  pyrites 344 

Wood  chemicals 345 

Acetic  acid 346 

Methyl  acetate 347 

Formaldehyde 347 

Toluol ,.  348 

Alkalis 349 

The   War  Trade  Board 350 

(1)  The  creation  of  the  War  Trade  Board 350 

(2)  All  exports  and  imports  brought  under  license  control 351 

The  control  over  exports 351 

The  conservation  list 352 

The  control  over  imports 352 

The  restricted  list 352 

(3)  The   exercise   of  price   control   by   uses   of   the   licensing 

power 353 

Rubber 357 

The  British  embargo  of  1914 357 

The  licensing  of  rubber  imports 358: 

The  restriction  of  rubber  imports  and  price  fixing.  358 

The  results  of  the  embargo 359 

Silk__  360 


10  CONTP:XTS. 

PART  II. — The  administration  of  price  controls  during  the  war — Contd.  page. 

7.  The   War    Department 3G1 

(1)  The  Army  represented  on  the  price-fixing  committee 3G3 

(2)  The  price-fixing  section 364 

(3)  Commandeering  and  requisitioning 364 

(4)  The  Board  of  Appraisers 365 

8.  The  Navy  Department : 367 

(1)  Commodities  purchased  by  the  Navy 367 

(2)  Representation    of   the   Navy   upon   the  price-fixing   com- 

mittee   371 

(3)  Commandeering 371 

(4)  The  supply  of  raw  materials  to  contractors  by  the  Navy__  372 

(5)  Determination  of  "  fair  and  just"  prices 373 

^  9.  The  Federal  Trade  Commission 374 

10.  The  Department  of  Agriculture 376 

(1)  The  control  of  farm  equipment 376 

(2)  Fertilizers 379 

vj     11.  The  basis  for  determining  a  fixed  price__ 380 

(1)  The  objects  of  the  price  fixers 380 

(2)  The  methods  of  control 381 

(3)  The  data  used  in  fixing  a  price 382 

(4)  The  problem  of  the  low-cost  and  the  high-cost  producers-  383 

(5)  Prices  fixed  above  the  "bulk  line"  of  production____ 399 

(6)  The  interpretation  of  a  "  reasonable  profit  " 409 

,  12.  The  lifting  of  Government  control  over  prices 411 

X(l)   The  effect  of  lifting  control  upon  prices 411 

(2)  The  purpose  of  the  Industrial  Board 413 

PART  III.— Statistical  devices  for  measuring  the  effects  of  price  control 415 

Introduction 415 

Table  1.  Gradual  extension  of  price  control 416 

Table  2.  The  Price  Section  weighted  index  number  separated  into 

controlled  and  uncontrolled  prices 418 

(1)  Tables  of  index  numbers  of  prices  of  controlled  and 

uncontrolled  commodities 419 

(2)  The  series  of  the  Price  Section  index  number  con- 

sidered uncontrolled 459 

(3)  The  series  of  the  Price  Section  index  number  con- 

sidered controlled ; 477 

Table  3.  Chain  indexes  of  controlled  and  uncontrolled  prices 491 

Table  4.  Relative   points   below   which    50   basic   commodities   were 

pegged 504 

A  summary  of  actual  and  relative  prices  below  which 

basic  prices  were  fixed 514 

Relative  prices  of  50  basic  commodities 516 

Table  5.  A  comparison  of  controlled  raw  material  prices  with  the 

prices  of  their  uncontrolled  manufactured  products 532 

Table  6.  A  comparison  of  the  prices  of  controlled  manufactured  goods 

with  the  prices  of  their  uncontrolled  raw  materials 540 

Table  7.  A  comparison  of  controlled  raw  material  prices  with  the 

prices  of  their  controlled  manufactured  products 542 

Table  8.  A  comparison  of  controlled  prices  at  wholesale  and  corre- 
sponding controlled  prices  at  retail 550 

Table  9.-  A  comparison  of  war  prices  in  the  United  States,  England, 

France,  and  Canada 553 


CONTENTS.  11 


BOOK  II. 

GOVERNMENT   REGULATIONS    RELATING    TO    PRICES. 


Page. 

1.  Introduction 567 

2.  Foods 568 

General  regulations 576 

Special  regulations 578 

Wheat  millers  and  manufacturers  of  mixed  flours 578 

Operators  of  all  places  for  the  storage  of,  and  dealers  in,  wheat, 

corn,  oats,  rye,  and  barley 585 

Rice 588 

Sugar ' 588 

Canners  of  peas,  tomatoes,  corn,  dried  beans,  salmon,  sardines,  and 

tuna;  manufacturers  of  tomato  catsup,  tomato  soup,  and  other 

tomato  products;  condensed,  evaporated,  or  powdered  milk 591 

Packers  of  dried  peaches,  dried  apples,  dried  prunes,  or  dried  raisins.  595 
Dealers  and  brokers  in,  and  importers  of,  certain  vegetable  oils 

and  their  raw  materials 597 

Manufacturers  of  oleomargarine  and  other  butter  substitutes 599 

Wholesalers,  jobbers,  importers,  and  retailers  of  licensed  nonperish- 

able  food  commodities 599 

Brokers  and  auctioneers  of  licensed  nonperishable  food  commodities.  610 

Dealers  in  sugars  and  sirups 611 

Distributors  of  fresh  fruits  and  vegetables 613 

Distributors  of  fresh  fish  and  frozen  fish 614 

Distributors  of  poultry '    616 

Distributors  of  eggs 619 

Manufacturers  and  distributors  of  butter 625 

Manufacturers  and  distributors  of  cheese •  629 

Cold  storage  warehousemen 634 

Distributors  of  feeding  stuffs 635 

3.  Fuels 640 

Anthracite  coal 642 

Bituminous  coal 643 

Coke 657 

Charcoal 661 

Jobbers'  margins  and  distributors'  commissions 661 

Retail  prices 662 

N  Petroleum 663 

4.  Metals  and  metal  products 665 

Aluminum 665 

Copper 669 

Iron  and  steel 670 

Lead 673 

Manganese  ore 673 

Nickel 675 

Platinum  metals 675 

Quicksilver 675 

Silver 676 

Zinc '. 678 

5.  Textiles  and  fibers 680 

Binder  twine 680 

Burlap 680 

Cotton  goods 681 


12  CONTENTS. 

5.  Textiles  and  fibers — Continued.  Page. 

Cotton  linters 703 

Rates  for  compressing  cotton 704 

Kapok 704 

Manila  fiber 705 

Rags 706 

Silk 708 

Wool 709 

6.  Hides,  skins,  and  leather 729 

Hides  and  skins 732 

Black  harness  leather 749 

Sole  and  belting  leather 750 

7.  Lumber 752 

General  regulations 752 

Birch  logs 755 

Black  walnut 755 

Cypress  and  tupelo 756 

Douglas  fir 759 

Mahogany  lumber 768 

New  England  spruce 768 

North  Carolina  pine 773 

Pennsylvania  hemlock 778 

Southern  or  yellow  pine 781 

Western  spruce 790 

Treenails 791 

8.  Building  materials 792 

Brick 792 

Gypsum  wall  board  and  plaster  board 793 

Hollow  building  tile 793 

Millwork 795 

Portland  cement 800 

Sand,  gravel,  and  crushed  stone 801 

La_Chemicals 803 

Acids 804 

Alkalis 805 

Bleaching  powder 805 

Carbon  tetrachloride 805 

Caustic  soda 805 

Chlorine,  liquid 805 

Soda  ash 805 

Ammonia 805 

Ammonium  sulphate 808 

Arsenic 808 

Castor  beans  and  castor  oil 808 

Glycerin 810 

Nitrate  of  soda 810 

Quebracho 810 

Smokeless  cannon  powder 811 

Sulphur 811 

Toluol 811 

Wood  chemicals 812 

Wool  grease 812 

10.  Rubber 812 

11.  Paper,  news-print 815 


APPENDIX. 


Page. 

OO-f 

Bibliography '" 

13 


LIST    OF    CHAETS. 

Page. 

1.  Weighted  index  numbers  of  prices  of  "  all  commodities,"  by  months, 

January,  1913,  to  the  time  that  control  began.    Average  price  July, 
1913-June,  1914=100 25 

2.  Weighted  index  numbers  of  prices  of  food  group,  by  months,  Janu- 

ary, 1913,  to  the  time  that  control  began 28 

3.  Weighted  index  numbers  of  prices  of  fuels  group,  by  months,  January, 

1913,  to  the  time  that  control  began 28 

4.  Weighted  index  numbers  of  prices  of  metals  group,  by  months,  Janu- 

ary, 1913,  to  the  time  that  control  began 28 

5.  Allied  and  neutral  sea*-going  tonnage  lost  and  built,  by  months,  Jan- 

uary,   1917-September,    1918 34 

6.  Relative   prices   of  wheat,   No.   2   red   winter,   cash   at   Chicago,   by 

months,   January,   1913-December,   1918 75 

7.  Relative  prices  of  flour,  wheat,  standard  patents,  at  Minneapolis,  by 

months,  January,  1913-DeDcember,  1918 75 

8.  Relative  prices  of  bread,  loaf,  bakery  to  retail  grocer,  by  months, 

January,   1913-December,   1918 75 

9.  Relative  prices  of  sugar  in  the  United  States,  England,  and  France, 

by  months,  January,  1913-December,  1918 86 

10.  Relative  prices  of  cotton  seed;  lard  substitute;  and  cottonseed  oil, 

crude,  by  months,  January,  1913-December,  1918 114 

11.  Relative  prices  of  canned  sardines,  oil,  keyless    (100  i-inch  case)  ; 

and  canned   salmon,   pink,   tall,  1   dozen  No.   1  cans,  by   months, 
January,   1913-December,   1918 118 

12.  Relative  prices  of  rice,  Japan  head ;  rice,  Honduras  head ;  and  puffed 

rice,  Quaker;  by  months,  January,  1913-December,  1918 120 

1.3.  Weighted  index  numbers  of  prices  of  corn  and  corn  products;   and 

"  all  commodities,"  by  months  January.  1913-December,  1918 125 

•14.  Weighted  index  numbers  of  prices  of  oats,  rice,  buckwheat,  and 
their  products ;  and  "  all  commodities,"  by  months,  January,  1913- 
December,  1918 , 125 

15.  Weighted  index  numbers  of  prices  of  hops,  rye,  barley,   and  their 

products ;    and    "  all    commodities,"    by    months,    January,    1913- 
December,  1918 125 

16.  Relative  prices  of  petroleum,  5  fields ;  fuel  oil,  5  cities ;  and  gasoline, 

5  cities,  by  months,  January,  1913-December,  1918 

17.  Weighted    index   numbers   of   iron,    steel,    and    their    products ;    and 

"  all  commodities,"  by  months,  January,  1913-December,  1918 247 

18.  Relative   prices   of   copper,    electrolytic,    at   New   York,   by   months, 

January,   1913-December,  1918 274 

19.  Relative  prices  of  short  staple  cotton,  upland  middling;  short  staple 

cotton  yarns,  5  series ;   and   short  staple  cotton   manufacture,   19 
series;  by  months,  January,  1913-December,  1918 —      304 

20.  Relative  prices  of  cotton  linters,   grade  D,   cut  130-175  pounds  per 

ton,  by  months,  January,  1913-December,  1918 309 

14 


CONTENTS.  15 

Page. 

21.  Relative   prices   of   raw   wool,   domestic   and   imported,   by   months, 

January,  1913-December,  1918 311 

22.  Weighted    index    numbers   of   prices    of   hides,   skins,    leather,    and 

leather  manufactures ;  and  "  all  commodities,"  by  months,  Janu- 
ary,   1913-December,    1918 317 

23.  Weighted  index  numbers  of  prices  of  lumber ;  and  "  all  commodi- 

ties," by  months,  January,  1913-December,  1918 32G 

24.  Weighted   index   numbers   of  prices  of   fertilizers;   and   "all   com- 

modities," by  months,  January,  1913-December,  1918 378 

25.  Costs   at  which   different  portions   of   the  output   of  beehive   coke 

were  produced  in  September,  1918 400 

26.  Costs  at  which  different  portions  of  the  output  of  pig  iron,  basic, 

were  produced  in  September,  1918 .      401 

27.  Costs  at  which  different  portions  of  the  output  of  Douglas  fir  were 

produced  in  March,  April,  and  October,  1918 402 

28.  Costs  at  which  different  portions  of  the  output  of  beet  sugar  were 

produced  in  1917-18 1 :-~ —       402 

29.  Average  adjusted  costs,  bulk  lines,  and  prices  originally  fixed  for 

all  bituminous  coal  districts  charted  during  August  and  Septem- 
ber,   1917 I 403 

30.  The  average  reported  costs  and  adjusted  costs  of  the  production  of 

anthracite  coal  in  the  Pennsylvania  anthracite  region  during  the 
period  December,  1917-May,  1918 403 

31.  The  Bureau  of  Labor  Statistics  index  number  of  "  all  commodities," 

separated  into   controlled   and   uncontrolled,   by   months,   August, 
1917-May,  1919.    Average  price  for  1913=100 411 

32.  Weighted   index   numbers   of   prices   of   "all   commodities"    (1,366 

series)    controlled  and  uncontrolled  during  the  war,  by  months. 
January,  1913-December,  1918 421 

33.  Weighted  index  numbers  of  prices  of  food  group   (268  series),  con- 

trolled  and   uncontrolled   during   the   war,    by   months,   January, 
1913-December,    1918 421 

34.  Weighted  index  numbers  of  prices  of  clothing  group  (409  series),  con- 

trolled and  uncontrolled  during  the  war,  by  months,  January,  1913- 
December,    1918 421 

35.  Weighted  index  numbers  of  prices  of  rubber,  paper,  and  fiber  group 

(119    series),    controlled    and    uncontrolled    during    the    war,    by 
months,  January,  1913-December,  1918 422 

36.  Weighted  index  numbers  of  prices  of  metals  group  (116  series),  con- 

trolled  and   uncontrolled   during   the    war,   by   months,    January, 
1913-December,    1918 422 

37.  Weighted  index  numbers  of  prices  of  fuels  group   (63  series),  con- 

trolled  and   uncontrolled    during   the   war,   by   months,    January, 
1913-December,    1918 422 

38.  Weighted  index  numbers  of  prices  of  building  materials  group   (149 

series),  controlled  and  uncontrolled  during  the  war,  by  months, 
January,  1913-December,   1918 423 

39.  Weighted  index  numbers  of  prices  of  chemicals  group  (243  series), 

controlled  and  uncontrolled  during  the  war,  by  months,  January, 
1913-December,    1918 423 

40.  Weighted  index   numbers  of  prices  of  cotton   and   cotton  products 

class  (81  series),  controlled  and  uncontrolled  during  the  war,  by 
months,  January,  1913-December,  1918—  423 


16  CONTENTS. 

Page. 

41.  Weighted  index  numbers  of  prices  of  wool  and  wool  products  class 

(66    series),    controlled    and    uncontrolled    during    the    war,    by 
months,  January,  1913-December,  1918 424 

42.  Weighted  index  numbers  of  prices  of  hides,  skins,  leather,  and  leather 

manufactures  class  (156  series),  controlled  and  uncontrolled  during 

the  war  by  months,  January,  1913-December,  1918 424 

43.  Weighted  index  numbers  of  prices  of  rubber   and  rubber  products 

class   (34  series),  controlled  and  uncontrolled  during  the  war,  by 
months,  January,  1913-December,  1918 424 

44.  Weighted  index  numbers  of  prices  of  iron,  steel,  and  their  products 

class   (88  series),  controlled  and  uncontrolled  during  the  war,  by 
months,  January,  1913-December,  1918 425 

45.  Weighted  index  numbers  of  prices  of  petroleum  and  petroleum  prod- 

ucts class  (27  series),  controlled  and  uncontrolled  during  the  war, 

by  months,  January,  1913-December,  1918— 425 

46.  Weighted  index  numbers  of  prices  of  lumber  class  (62  series),  con- 

trolled  and   uncontrolled   during   the   war,   by   months,   January, 
1913-December,  1918 — __________ 425 

47.  Weighted  chain  index  for  prices  of  "-all  commodities"  (1,366  series), 

controlled   and   uncontrolled   during   the    war,   by   months,   April, 
1917-December,     1918 492 

48.  Weighted  chain  index  for  prices  of  food  group    (268  series),  con- 

trolled and  uncontrolled  during  the  war,  by  months,  April,  1917- 
December,  1918 495 

49.  Weighted  chain  index  for  prices  of  clothing  group  (409  series,)  con- 

trolled and  uncontrolled  during  the  war,  by  months,  April,  1917- 
December,  1918 495 

50.  Weighted  chain  index  for  prices  of  metals  group   (116  series),  con- 

trolled and  uncontrolled  during  the  war,  by  months,  April,  1917- 
December,    1918 496 

51.  Weighted  chain  index  for  prices  for  fuels  group   (63  series),  con- 

trolled and  uncontrolled  during  the  war,  by  months,  April,  1917- 
December,    1918 496 

5£  Weighted  chain  index  for  prices  of  building  materials  group  (149 
series),  controlled  and  uncontrolled  during  the  war,  by  months, 
April,  1917-December,  1918— 497 

53.  Weighted  chain  index  for  prices  of  wheat  and  wheat  products  class 

(12    series),    controlled    and    uncontrolled    during    the    war,    by 
months,  April,  1917-December,  1918 497 

54.  Weighted  chain  index  for  prices  of  cotton  and  cotton  products  class 

(81    series),    controlled    and    uncontrolled    during    the    war,    by 
months,  April,  1917-December,  1918 498 

55.  Weighted  chain  index  for  prices  of  wool  and  woolen  products  class 

(66    series),    controlled    and    uncontrolled    during    the    war,    by 
months,  April,   1917-December,  1918 498 

56.  Weighted  chain  index  for  prices  of  iron,  steel,  and  their  products 

class  (88  series),  controlled  and  uncontrolled  during  the  war,  by 
months,  April,  1917-December,  1918 499 

57.  Weighted  chain  index  for  prices  of  coal  and  coke  class  (27  series), 

controlled  and  uncontrolled   during  the   war,   by   months,   April, 
1917-December,    1918 499 

58.  Relative  prices  of  sugar,  raw,  96°  centrifugal,  net  cash,  by  months, 

January,    1913-December,    1918 507 


CONTENTS.  17 

Page. 

59.  Relative  prices  of  wheat  No.  1  Northern  spring,  cash,  by  months, 

January,    1913-December,   1918 507 

60.  Relative   prices   of   cattle   hides,    packers'   heavy   native   steers,   by 

months,  January,   1913-December,   1918 507 

61.  Relative   prices  of  cotton   weaving   yarns   carded,   white,   northern, 

mule  spun,  22/1  cones,  by  months,  January,  1913-December,  1918 508 

62.  Relative  prices   of  print   cloth,   27-inch,    64  by   60,   7.60   yards,   by 

months,  January,  1913-December,  1918 508 

G3.  Relative  prices  of  wool,  Ohio,  Pennsylvania,  and  West  Virginia,  un- 
washed, fine  delaine,  by  months,  January,  1913-December,  1918 508 

64.  Relative  prices  of  rubber,  crude  plantation,  Hevea,  first  latex  crgpe, 

by  months,  January,  1913-December,  1918 509 

65.  Relative  prices  of  copper,  electrolytic,  at  New  York,  by  months,  Janu- 

ary, 1913-December,  1918 509 

66.  Relative  prices  of  iron  ore,  Mesabi,  nonbessemer,  51$  per  cent,  by 

months,  January,  1913-December,  1918 509 

67.  Relative  prices  of  pig  iron,  basic,  by  months,  January,  1913-Decem- 

ber, 1918 I 510 

68.  Relative   prices   of   steel   plates,   tank,   by   months,    January,    1913- 

December,  1918 510 

69.  Relative   prices   of  anthracite   coal,   chestnut,  by  months,   January, 

1913-December,  1918 511 

70.  Relative  prices  of  bituminous  coal,  by  months,  January,  1913-Decem- 

ber, 1918 511 

71.  Relative   prices   of   Connellsville   coke,   by   months,    January,    1913- 

December,  1918 512 

72.  Relative  prices  of  crude  petroleum,  mid-continent,  by  months,  Janu- 

ary, 1913-December,  1918 512 

73.  Relative   prices   of   Douglas   fir,   by   months,    January,   1913-Decem- 

ber, 1918 513 

74.  Relative  prices   of  yellow   pine,    Southern,   common   boards,   No.   1, 

S-2-S,  1  by  10  inches,  by  months,  January,  1913-December,  1918__      513 

75.  Relative  prices  of  sulphuric  acid,  60°,  by  months,  January,   1913- 

December,  1918 513 

76.  Relative  prices  of  copper,  electrolytic,  and  copper  wire,  by  months, 

January,  1913-December,  1918 533 

77.  Relative  prices  of  pig  iron,  chains,  and  saws,  by  months,  January, 

1913-December,  1918 533 

78.  Relative  prices  of  lead  and  lead  pipe,   by  months,  January,   1913- 

December,  1918 533 

79.  Relative  prices  of  wool,  woolen  yarns,  and  woolen  suitings,  by  months, 

January,  1913-December,  1918 534 

80.  Relative  prices  of  crude  rubber  and  rubber  tires,  by  months,  Janu- 

ary, 1913-December,  1918 ,_ 534 

81.  Relative  prices  of  calf-skin  leather,  and  shoes,  by  months,  January, 

1913-December,  1918 534 

82.  Relative  prices  of  cotton  yarn  and  raw  cotton,  by  months,  January, 

1913-December,  1918 543 

83.  Relative  prices  of  wheat,  wheat  flour,  and  bread,  by  months,  Janu- 

ary, 1913-December,  1918 543 

84.  Relative  prices  of  iron  ore,  pig  iron,  and  iron  pipe,  by  months,  Janu- 

ary, 1913-December,  1918 544 

125547°— 20 2 


18  CONTENTS. 

Page. 

85.  Relative  prices  of  coal  and  coke,  by  months,  January,  1913-Decem- 

ber,  1918 544 

86.  Relative  prices  of  cattle  hides  and  sole  leather,  by  months,  January, 

1913-December,  1918 545 

87.  Relative   prices    of   sugar,    raw    and   refined,   by   months,    January, 

1913-December,  1918 545 

88.  Medians  of  relative  prices  of  150  commodities  in  the  United  States 

and  England,  by  months,  January,  1913-December,  1918 557 

89.  Medians  of   relative  prices  of  34  food  commodities  in  the  United 

States  and  England,  by  months,  January,  1913-December,  1918 557 

90.  Medians  of  relative  prices  of  29  clothing  commodities  in  the  United 

States  and  England,  by  months,  January,  1913-December,  1918 558 

91.  Medians  of  relative  prices  of  9  iron  and  steel  commodities  in  the 

United  States  and  England,  by  months,  January,  1913-December, 

1918 558 

92.  Medians  of  relative  prices  of  55  chemical  commodities  in  the  United 

States  and  England,  by  months,  January,  1913-December,  1918 559 

93.  Medians  of  relative  prices  of  44  commodities  in  the  United  States  and 

France,  by  months,  January,  1913-December,  1918 559 

94.  Index  numbers  of  wholesale  prices  in  the  United  States  and  Canada, 

by  months,  January,  1913-December,  1918 559 


INTRODUCTION. , 


The  uppermost  aims  of  this  inquiry  have  been  to  present  an 
analysis  and  a  documentary  record  of  all  price  regulation  exercised 
by  the  Government  during  the  World  War.  The  lawer  task,  which 
had  to  be  performed  as  a  basis  for  the  former,  was  made  peculiarly 
difficult  by  the  prompt  departure  of  commodity  chiefs  from  Wash- 
ington after  the  armistice,  and  by  the  chaos  of  abandoned  war  files. 
This  monograph  covers  all  price  regulations  of  which  record  was 
found,  but  other  informal  controls  were  agreed  upon  by  word  of 
mouth  of  which  no  written  record  remains. 

All  data  of  descriptive  or  analytical  character  appear  in  Book  I, 
and  all  regulations  pure  and  simple  in  Book  II.  Book  I  is  separated 
into  three  parts  to  show  the  problems  that  led  the  Government  into 
price  control,  the  administration  of  price  control  during  the  war, 
and  various  statistical  devices  for  measuring  the  effects  of  control. 
A  full  analysis  of  the  methods,  powers,  and  policies  of  each  price- 
control  board  is  given  as  general  background  to  the  specific  com- 
modity controls.  The  individual  controls  are  then  each  discussed 
in  detail  under  the1  board  having  jurisdiction  over  them  at  the  time 
of  the  armistice.  Book  II  is  separated  into  ten  parts,  and  is  a  docu- 
mentary record  strictly  of  all  known  Government  regulations  relat- 
ing to  food;  fuel;  metal  and  metal  product;  textile  and  fiber;  hide, 
skin,  and  leather;  lumber;  building  material;  chemical;  rubber  and 
paper  prices. 

This  study  represents  a  cooperative  effort  of  the  statistical  di- 
visions of  the  War  Trade  Board  and  the  War  Industries  Board, 
under  Edwin  F.  Gay.  It  is  Bulletin  No.  3  of  a  series  of  57  bulletins 
which  make  up  a  "  History  of  prices  during  the  war,"  edited  by 
Wesley  C.  Mitchell.  The  others  of  these  bulletins,  which  are  listed 
on  the  last  page,  are  records  of  monthly  price  fluctuations  from 
January,  1913,  through  December,  1918.  They  afford  indispensable 
bases  for  further  inquiries  into  the  price-control  problem.  Every 
precaution  has  been  taken  here  to  enhance  their  value  to  that  end,  by 
keeping  all  charts  in  scale  with  theirs  and  by  following  similar  forms. 

Many  more  persons  have  given  aid,  directly  or  indirectly,  in 
gathering  materials  than  can  be  named.  But  especial  indebtedness 
for  data  on  wheat,  flour,  and  bread  is  owing  to  Lloyd  W.  Maxwell ; 

19 


20  INTBODUCTION-. 

on  building  materials  to  Homer  Hoyt;  on  hides,  skins,  and  leather, 
to  E.  A.  James;  and  on  wool  to  Katherine  Snodgrass.  The  manu- 
script pertaining  to  the  Food  Administration  was  read  in  full,  and 
approved  as  to  the  accuracy  of  facts,  by  Raymond  Pearl  and  W.  C. 
Mullendore ;  the  Fuel  Administration,  by  C.  E.  Lesher ;  the  War  In- 
dustries Board,  by  Leo  Wolman;  and  the  War  Trade  Board,  by 
Henry  F.  Waldradt.  Particular  sections  were  checked  in  addition 
by  persons  having  technical  knowledge  of  their  contents.  All  manu- 
script and  proof  has  been  read  and  materially  strengthened  by  Leo 
Wolman  and  Wesley  C.  Mitchell. 

The  staff,  whs  assisted  immediately  in  the  preparation  and  colla- 
tion of  materials,  was  Mr.  Isadore  Lubin,  Miss  Stella  Stewart,  Miss 
Susie  Anderson,  and  Miss  Elsie  Ray.  Mr.  Lubin  is  responsible  for 
the  sections  on  sugar,  live  stock  and  meats,  poultry  and  dairy  prod- 
ucts, oleomargarine,  cottonseed  and  cotton-seed  products,  canned 
and  dried  foods,  rice  and  rice  flour,  coarse  grains  and  foodstuffs^ 
coffee,  ammonia,  ice?  arsenic,  petroleum,  aluminium,  lead,  zinc,  nickel, 
quicksilver,  tin,  platinum,  cotton  textiles,  cotton  linters,  manila 
fiber  and  hemp,  burlap,  chemicals,  rubber,  silk,  and  fertilizers.  Miss 
Stewart  assisted  in  gathering  materials  and  in  the  compilation  of 
regulation  schedules  which  appear  in  Book  II.  Miss  Anderson  had 
charge  of  the  computations.  Miss  Eay  attended  to  the  clerical 
work. 

P.  W.  G. 


BOOK  I 


GOVERNMENT  CONTROL  OVER  PRICES 


21 


THE 


PART  I. 

PROBLEMS  THAT  LED   THE   GOVERNMENT 
INTO  PRICE  CONTROL. 


i,  THE  RISE  IN  PRICES  BEFORE  THE  GOVERNMENT 
INTERFERED. 

The  future  student  of  American  prices  will  turn  back  to  the  14 
months  from  August,  1917,  to  the  signing  of  the  armistice,  and  mark 
them  as  the  period  of  our  initial  great  experience  with  Government 
price  control.  The  Government  laid  no  resolute  hand  upon  prices 
even  during  the  Civil  War,  although  at  that  time  staple  quotations 
more  than  doubled.1  Nor  did  the  Government  seek  to  arrest  the 
phenomenal  rises  during  1916  and  1917,  provoked  by  European  war 
buying,  until  this  country  itself  entered  the  war.  The  circumstances 
attending  this  first  and  extraordinary  experiment  in  the  regulation 
of  prices  possess  peculiar  interest. 

The  factors  that  dictated  to  the  Government  the  necessity  of  regu- 
lating prices  were  the  high  level  to  which  prices  had  climbed  by  the 
late  summer  of  1917  and  the  fear  of  a  further  rise.  The  precontrol 

1  The  Price  Section  of  the  War  Industries  Board  in  its  "  Comparison  of  Prices  During 
the  Civil  War  and  Present  War  "  has  made  the  following  medians  of  relative  prices  of 
commodities  at  wholesale.  They  show  relatively  how  high  Civil  War  and  present  war 
prices  went  above  their  respective  prewar  levels,  represented  by  100. 


All  com- 
modities. 

Foods. 

Building 
materials. 

Chemicals. 

Cotton. 

Copper, 
ingot. 

Civil 
War. 

Pres- 
ent 
war. 

Civil 
War. 

Pres- 
ent 
war. 

Civil 
War. 

Pres- 
ent 
war. 

Civil 
War. 

Pres- 
ent 
war. 

Civil 
War. 

Pres- 
ent 
war. 

Civil 
War. 

Pres- 
ent 
war. 

Number  of  commodities.  .  . 

1860  and  1913: 
January 

92 

100 
100 
100 
100 

100 

96 
96 
97 

100 
100 
100 
111 

125 
137 
134 
135 

156 

169 
194 
200 

216 
190 
158 
175 

92 

100 
100 
100 
100 

100 
100 
100 
100 

100 
100 
102 
102 

114 
115 
119 
130 

142 
157 
169 
174 

178 
182 
187 

36 

36 

100 
100 
100 
100 

100 
100 
100 
105 

107 
105 
105 
102 

110 
113 
117 
127 

142 
162 
169 
193 

188 
199 
194 

19 

19 

15 

15 

•     •    - 

100 
100 
100 
100 

100 
100 
100 
100 

100 
100 
115 
126 

138 
187 
187 
156 

152 
175 
177 
196 

192 
197 
193 

2 

101 

101 
98 
99 

112 
117 
136 
197 

336 
253 
346 
515 

618 
668 
631 
773 

741 
695 
1,410 
1,101 

1,096 
343 
430 
426 

2 

98 
95 
95 
106 

98 
101 
101 
53 

62 
76 
69 
94 

94 
92 
100 
135 

134 
152 
196 
209 

243 
250 
232 

1 

1 

117 
101 
97 
110 

99 
96 
89 

78 

87 
106 
132 
120 

152 
179 
177 
190 

197 
227 
212 
157 

157 
157 
170 

100 
100 
98 
99 

98 
94 
88 
91 

99 
96 
93 
100 

116 
125 
117 
125 

152 
161 

184 
194 

232 
189 
156 
170 

100 
100 
100 
100 

100 
100 
100 
102 

106 
112 
107 
116 

133 
143 
139 
145 

160 
177 
189 
200 

200 
196 
171 
200 

100 
100 
100 
100 

100 
100 
100 
100 

100 
100 
100 
100 

104 
109 
110 
117 

124 
137 
152 
152 

161 
172 
181 

100 
100 
100 
100 

100 
100 
100 
100 

117 

107 
109 
125 

130 
142 
142 
133 

153 
161 

189 
200 

222 
182 
153 
170 

100 
98 
89 
90 

81 
81 
77 
87 

113 
94 
98 
119 

132 
130 
130 
138 

161 
172 
198 
200 

209 
145 
121 
138 

April  

July 

October  

1861  and  1914: 
January 

April  

July 

October 

1862  and  1915: 
January 

April  ... 

July 

October  

1863  and  191  6: 
January 

April... 

July 

October 

1864  and  1917: 
January    . 

April 

July  

October. 

1865  and  1918: 
January    . 

April     . 

July 

October  

23 


24 


HISTORY   OF  PRICES   DURING  THE   WAR. 


rises  of  commodity  prices  at  wholesale  may  be  divided  into  three 
periods — the  prewar  advance  from  1890  to  the  outbreak  of  the 
European  war,  the  war-time  rises  to  April  6,  1917,  and  the  final 
upward  swing  of  prices  that  was  under  way  when  the  Government 
interfered. 

(i)   THE  MOVEMENT  OF  PRICES  FROM  1890  TO  THE  EUROPEAN  WAR. 

The  fluctuations  in  prices  for  the  quarter  century  prior  to  the  out- 
break of  war  in  Europe  on  July  28,  1914,  bore  upon  price  control 
only  as  they  established  rather  definite  courses  of  price  movement 
by  departure  from  which  war  prices  gave  alarm.  The  most  reliable 
measure  of  the  price  level  for  that  period  is  the  index  number  made 
by  the  Bureau  of  Labor  Statistics  for  all  commodities  and  those  for 
important  groups.1 

JThe  Bureau  of  Labor  Statistics  index  number,  separated  to  show  prices  within  nine 
distinct  groups  (Farm  products;  Food,  etc.;  Cloths  and  clothing;  Fuel  and  lighting; 
Metals  and  metal  products ;  Lumber  and  building  materials ;  Chemicals  and  drugs ; 
House-furnishing  goods;  and  Miscellaneous),  contains  quotations  for  representative  com- 
modities, varying  in  number  from  192  in  1890  to  297  in  1914.  These  actual  prices, 
in  order  that  each  might  have  its  proper  influence  upon  the  final  index  number,  were 
made  into  weighted  aggregates  and  then  turned  into  relatives  by  allowing  each  average 
prewar  aggregate  for  1913  to  equal  100.  The  index  numbers  for  "  all  commodities " 
and  the  nine  groups  from  1890  to  the  outbreak  of  war  in  Europe,  and  for  later  reference 
on  through  1918,  follow  : 

Bureau  of  Labor  Statistics  index  number  of  prewar  prices. 
[1913=100.] 


Year. 

All 
com- 
modi- 
ties. 

Farm 
prod- 
ucts. 

Food, 
etc. 

Cloths 
and 
cloth- 
ing. 

Fuel 
and 
light- 
ing. 

Metals 
and 
metal 
prod- 
ucts. 

Lum- 
ber 
and 
build- 
ing 
mate- 
rials. 

Chem- 
icals 
and 
drugs. 

House- 
fur- 
nish- 
ing 
goods. 

Miscel- 
lane- 
ous. 

1890  

81 

68 

89 

92 

69 

114 

72 

90 

119 

92 

1891 

81 

73 

89 

89 

68 

102 

70 

92 

119 

92 

1892  

76 

66 

80 

89 

65 

93 

67 

91 

116 

88 

1893  - 

77 

67 

87 

88 

65 

85 

68 

90 

116 

91 

1894 

69 

59 

77 

78 

61 

72 

66 

83 

115 

86 

1895 

70 

60 

74 

78 

68 

77 

64 

88 

109 

82 

1896  

66 

54 

67 

75 

68 

80 

63 

91 

106 

80 

1897 

67 

58 

71 

75 

61 

71 

62 

89 

99 

80 

1898  

69 

61 

76 

79 

61 

71 

65 

92 

105 

79 

1899  --- 

74 

62 

75 

82 

71 

108 

71 

96 

104 

82 

1900 

80 

69 

79 

88 

81 

106 

76 

97 

111 

91 

1901 

79 

73 

80 

82 

78 

98 

73 

98 

123 

90 

1902  

85 

81 

85 

84 

93 

97 

77 

97 

123 

92 

1903 

85 

75 

82 

88 

106 

96 

80 

96 

122 

94 

1904  

86 

80 

87 

89 

91 

88 

80 

97 

117 

94 

1905 

86 

77 

87 

91 

87 

98 

85 

96 

109 

95 

1906  

88 

78 

84 

97 

90 

113 

94 

94 

109 

97 

1907 

94 

85 

89 

104 

93 

120 

97 

96 

109 

101 

1908  

91 

85 

94 

94 

90 

94 

92 

100 

104 

97 

1909 

97 

97 

99 

98 

88 

92 

97 

101 

105 

106 

1910       

99 

103 

100 

99 

83 

93 

101 

102 

104 

116 

1911 

95 

93 

99 

96 

81 

89 

101 

103 

99 

104 

1912  

101 

101 

108 

98 

89 

99 

100 

101 

99 

101 

1913 

100 

100 

100 

100 

100 

100 

100 

100 

100 

100 

1914 

99 

103 

103 

98 

92 

87 

97 

103 

103 

97 

1915 

100 

105 

104 

100 

87 

97 

94 

113 

101 

98 

1916  

123 

122 

126 

127 

115 

148 

101 

143 

110 

121 

1917 

175 

188 

177 

181 

169 

208 

124 

185 

155 

154 

1918 

196 

218 

189 

236 

175 

182 

151 

206 

207 

195 

GOVERNMENT  CONTROL  OVER  PRICES. 


25 


This  index  of  prewar  prices,  when  compared  with  those  of  war- 
time prices,  shows  relatively  a  sober  behavior.  The  greatest  variation 
of  the  index  number  for  "  all  commodities  "  during  any  year  from 
its  preceding  year,  was  the  drop  of  10  per  cent  in  1894.  The  greatest 
subsequent  yearly  variation  was  the  rise  of  8  per  cent  which  came  in 
1900  and  again  in  1902.  The  average  of  all  yearly  variations  up  or 
down  between  1890  and  1914  was  less  than  5  per  cem%  though  most 
of  the  changes  were  increases.  The  fluctuations  within  the  groups — 
farm  products,  fuel  and  lighting, 
and  metals  and  metal  products — 
were  somewhat  more  violent  than 
these  summary  data  show.  The 
metal  index,  indeed,  shows  that 
metals  jumped  from  48  in  1898  to 
73  in  1899,  representing  an  increase 
of  52  per  cent.  There  had,  of 
course,  been  extraordinary  rises  in 
prices  during  peace  times,  but  they 
were  all  presently  to  be  surpassed. 


(2)    THE    WAR-TIME    PRICES 
APRIL  6,  1917. 


TO 


WEIGHTED  INDEX  NUMBERS  OFPRO30P 

^LL  COMMODITIES 

DCTOPE  CONTROL  BEGAN 

'E>Y  MONTHS' 
JANUARY.lSti  T°AUau3T.I9rr 

Z40 
ZZO 

ZOO 
180 

160 

MO 
1EO 

00  ' 

I       1915            1914      |      1915 

1916       I      1917 

QXtOJIH! 

*  n 

n  p 

220 

180 

f. 

1 

- 

1 

IZfl 

2 

100 

*p*fcp^^^^ 

J 

ao 

60 

60 

,1.....;.. 

S  1  5 

is  B  i 

\  3  \ 

1  1  s 

I  §  1 

1913 

1914 

1913 

1O16             1917 

J 


The  outbreak  of  the  war  in 
Europe  marked  sharply  a  new  pe- 
riod in  the  history  of  world  prices, 
though  the  immediacy  with  which 
different  American  prices  responded 
was  curiously  varied.  The  dis- 
turbance in  European  prices  was 
communicated  to  certain  American 
markets  by  August,  1914.  But 

prices,    as    a    whole,    in   this    Country    Weighted    index    numbers.—  "  All    com- 

held  close  to  their  prewar  level  for 
a  full  year  after  the  war  began. 
The  "  all  commodities  "  index  num- 
ber of  the  Bureau  of  Labor  Statistics,  measuring  roughly  the  varia- 
tions in  the  general  price  level,  ran  82,  81,  80,  81,  for  1912  and 
the  three  years  following.  Indeed,  not  during  any  three  successive 
years  since  1890  had  prices  been  so  nearly  steady  as  in  1913,  1914, 
and  1915. 

The  index  number  of  1,366  commodities  at  wholesale  made  by  the 
Price  Section  of  the  War  Industries  Board,  which  is  the  best  meas- 
ure of  American  war  prices  pure  and  simple,  shows  that  the  relative 
stability  of  the  general  price  level  was  the  net  resultant  of  numerous 


months, 

1918.      (Average   quoted   prices,   July, 

1913,  to  June,  1914=100.) 


26 


HISTORY   OF   PRICES   DURING   THE   WAR. 


price  changes  in  opposite  directions.1  The  prices  of  chemicals,  as 
might  be  expected,  started  climbing  after  Europe  had  been  at  war  but 
a  month  and  did  not  turn  back  until  a  year  and  one-half  later,  when 
they  had  doubled.  Metals,  too,  began  soaring  after  Europe  had  beeir 
fighting  only  six  months,  and  carried  quotations  on  a  runaway  market 
toward  levels  unknown  before.  On  the  other  hand,  fuel  prices  con- 
tinued falling  for  a  full  year  after  the  war  had  begun,  as  did  rubber, 
paper,  and  fiber  prices  generally.  But  the  prices  of  food,  clothing, 
building  materials,  and,  indeed,  the  general  price  level,  as  shown 
graphically  in  the  "  all  commodities  "  index  number,  remained  stub- 
bornly unresponsive  to  war  stimuli  until  the  autumn  of  1915. 

The  Governments  of  England,  France,  and  Russia,  however,  had 
been  placing  enormous  contracts  for  war  materials  in  the  United 
States,  and  these  purchases  finally  set  American  prices  rising.  When 

1  For  measuring  the  price  changes  during  the  war  period  strictly,  or  indeed  from  Jan- 
uary, 1913,  to  December,  1918,  there  is  distinct  advantage  in  shifting  from  the  Bureau 
of  Labor  Statistics'  index  number  to  that  made  by  the  Price  Section  of  the  War  Indus- 
tries Board  under  the  direction  of  Wesley  C.  Mitchell.  This  latter  index  number,  made 
in  a  somewhat  similar  manner,  contains  prices  for  1,366  representative  commodities  by 
months,  quarters,  and  years  for  the  six-year  period.  It,  moreover,  is  divided  into  seven 
index  numbers  for  the  food,  clothing,  rubber,  paper,  fiber,  metals,  fuels,  building 
materials,  and  chemical  groups,  which  in  turn  are  separated  into  50  index  numbers  for 
important  industrial  classes.  The  actual  monthly  quotations  for  each  commodity  were 
multiplied  by  the  1917  production  plus  imports,  the  products  were  then  cast  up  separately 
for  each  of  the  72  months  covered,  and  finally  the  aggregates  were  turned  into  relatives 
by  taking  the  average  aggregate  from  July  1,  1913,  to  June  30,  1914,  as  equal  to  100. 
For  further  details,  see  War  Industries  Board  Price  Bulletin  No.  1. 

The  Price  Section  index  number  for  "  all  commodities  "  and  those  for  the  seven  main 
groups,  from  January,  1913,  to  December,  1918,  follow : 

Price  section  index  number  of  war  prices,  1913-1918. 
[Base,  average  prices  July,  1913,  to  June,  1914=100.) 


Series  of  quotations. 

All 

com- 
modi- 
ties. 

Food 
group. 

Cloth- 
ing 
group. 

Rub- 
ber, 
paper, 
and 
fibers 
group. 

Metals 
group. 

Fuels 
group. 

Build- 
ing 
mate- 
rials 
group. 

Chemi- 
cals 
group. 

1913. 
Januarv 

103 

98 

102 

114 

120 

102 

104 

103- 

February  

102 

96 

102 

113 

118 

101 

•      104 

104 

March                                         

102 

97 

101 

112 

116 

101 

105 

104 

April 

101 

97 

100 

107 

114 

101 

105 

103 

May..                .                   

100 

95 

100 

105 

113 

101 

105 

103 

June 

100 

96 

99 

105 

111 

101 

105 

102 

July.                   

100 

96 

99 

104 

110 

101 

102 

102 

August 

101 

100 

100 

104 

110 

102 

102 

101 

September 

102 

102 

100 

103 

108 

102 

103 

101 

October                                     

102 

102 

103 

102 

105 

102 

100 

100 

November 

102 

103 

102 

101 

100 

102 

100 

100 

December                             

101 

102 

100 

99 

96 

101 

100 

101 

Year  

101 

99 

101 

106 

110 

101 

103 

102 

1914. 
January 

100 

101 

99 

98 

96 

101 

99 

99 

February 

100 

101 

99 

98 

98 

100 

99 

90 

March 

99 

100 

100 

98 

97 

100 

99 

100 

\pril 

98 

98 

99 

99 

96 

98 

99 

99 

May 

97 

98 

99 

98 

92 

96 

98 

98 

June 

97 

97 

100 

97 

93 

95 

98 

99 

July                                    

97 

98 

100 

9G 

91 

94 

98 

98 

August 

101 

105 

99 

101 

94 

94 

98 

99 

September                    

101 

107 

94 

100 

93 

92 

98 

100 

October                                             

99 

104 

91 

98 

91 

91 

96 

105 

98 

103 

88 

98 

89 

91 

95 

106 

December 

98 

104 

89 

100 

89 

91 

94 

105 

Year  

99 

101 

96 

98 

93 

95 

98 

101 

GOVERNMENT   CONTROL   OVER   PRICES. 


27 


the  rise  did  begin  on  this  side  of  the  Atlantic  it  was  extraordinarily 
rapid  and  often  erratic.  The  whole  price  level,  in  point  of  fact, 
started  upward  late  in  1915  at  a  pace  not  known  since  Civil  War  days. 

Price  section  index  number  of  war  prices,  1913-1918.— Continued. 
[Base,  average  prices  July,  1913,  to  June,  1914=100.] 


Series  of  quotations. 

* 

All 
com- 
modi- 
ties. 

Food 
group. 

Cloth- 
ing 
group. 

Rub- 
ber, 
paper, 
and 
fibers 
group. 

Metals 
group. 

Fuels 
group. 

Build- 
ing 
mate- 
rials 
group. 

Chemi- 
cals 
group. 

1915. 

100 

105 

90 

100 

91 

90 

93 

123 

February                          

100 

106 

92 

90 

93 

89 

93 

126 

March 

100 

105 

92 

90 

95 

88 

93 

126 

April 

100 

103 

93 

90 

98 

85 

93 

133 

May 

100 

103 

95 

90 

101 

85 

94 

132 

June 

100 

100 

95 

90 

106 

85 

94 

137 

July 

102 

103 

96 

91 

110 

85 

96 

146 

August                                

102 

101 

96 

90 

110 

86 

95 

148 

September 

102 

99 

98 

89 

114 

90 

95 

155 

October 

104 

99 

103 

90 

116 

92 

101 

162 

November                           

107 

102 

106 

92 

124 

95 

101 

172 

December                                         ... 

111 

103 

107 

95 

136 

100 

102 

178 

Year  

102 

102 

97 

91 

108 

89 

96 

145 

1916. 
January                                    

115 

105 

110 

103 

147 

106 

109 

189 

February 

118 

106 

113 

104 

154 

107 

111 

200 

March                               

121 

106 

115 

109 

168 

109 

112 

200 

April 

123 

109 

116 

112 

174 

112 

113 

198 

May 

123 

109 

118 

112 

171 

113 

113 

188 

June                                   

122 

109 

120 

111 

169 

113 

113 

185 

July 

123 

111 

122 

112 

167 

113 

112 

175 

August      .                

125 

115 

125 

114 

170 

110 

112 

166 

September 

127 

118 

129 

117 

172 

109 

112 

162 

October  

132 

125 

135 

120 

176 

111 

116 

162 

November                   .             

141 

130 

136 

123 

202 

120 

118 

163 

December 

144 

129 

154 

129 

218 

122 

119 

162 

Year  

126 

118 

125 

114 

174 

112 

114 

179 

1917. 
January 

— 
148 

133 

155 

138 

226 

129 

129 

===== 
159 

February 

151 

136 

156 

141 

234 

133 

130 

157 

March  

156 

142 

157 

143 

247 

131 

132 

159 

April                                     

170 

157 

163 

146 

260 

163 

146 

163 

May 

178 

166 

167 

148 

276 

172 

148 

172 

June  

183 

164 

174 

147 

315 

173 

151 

174 

July                                     

189 

167 

187 

144 

333 

168 

155 

180 

August 

187 

168 

189 

143 

313 

169 

155 

183 

September 

186 

173 

189 

149 

283 

165 

156 

190 

October                               

182 

177 

191 

147 

228 

164 

157 

193 

November 

183 

182 

199 

146 

209 

167 

159 

191 

December  

182 

178 

202 

145 

208 

170 

159 

193 

Year  

175 

162 

177 

145 

262 

158 

148 

176 

1918. 
January 

185 

182 

209 

148 

208 

173 

165 

186 

February  .  . 

187 

184 

212 

148 

209 

174 

165 

192 

March  .. 

188 

182 

218 

150 

209 

175 

169 

192 

April 

191 

180 

228 

155 

208 

200 

176 

192 

May 

190 

177 

226 

162 

209 

204 

179 

190 

June     ^                           

189 

175 

228 

165 

210 

202 

181 

189 

July 

193 

182 

233 

164 

212 

201 

182 

184 

August 

196 

187 

234 

166 

214 

202 

184 

186 

September     

201 

194 

237 

166 

214 

.       204 

186 

188 

October 

201 

195 

238 

165 

216 

204 

185 

190 

November 

201 

194 

234 

163 

216 

207 

186 

193 

December  

203 

202 

230 

162 

211 

207 

185 

183 

Year 

194 

186 

227 

160 

211 

196 

179 

189 

28 


HISTORY   OF   PRICES   DURING   THE   WAR. 


8          8 


1 


2  § 


m 

S 


§         I 


I 


8          3 


GOVERNMENT   CONTROL,  OVER  PRICES.  29 

(3)   THE   FINAL   UPWARD   SWING  WHICH   PROVOKED   GOVERNMENT 

CONTROL. 

The  war-time  rises  in  prices  before  the  United  States  entered  war 
did  not  of  themselves  provoke  Government  interference.  But  the 
rises  stimulated  immediately  by  our  entrance  into  war,  were  serious 
largely  because  they  came  after  prices  had  already  reached  extraor- 
dinary heights.  Between  October,  1915,  and  December,  1916,  the 
index  number  of  "  all  commodities  "  had  risen  from  104  to  144.  The 
gradual  breaking  of  relations  with  Germany  then  forced  other  ad- 
vances, and  by  March,  1917,  the  "all  commodities"  index  stood  at 
156.  When  this  country  declared  war  in  April,  the  index  jumped 
14  points  in  a  single  month. 

The  prices  of  metals  had  a  runaway  market  and  were  carried  by 
July,  1917,  to  peaks  unknown  before.  The  weighted  index  number 
for  the  whole  metals  group  made  by  the  Price  Section,  rose  from  247 
in  March,  the  month  before  war  was  declared,  to  333  by  July  follow- 
ing.1 Basic  pig  iron,  f.  o.  b.  Mahoning  or  Shenango  Valley  furnaces, 
indeed,  climbed  from  $32.25  to  $52.50  in  the  same  months,  and  steel 
plates,  tank  at  Pittsburgh,  from  $4.33  to  $9,  nearly  800  per  cent  above 
their  prewar  quotation.  The  very  important  food  group  index 
swung  upward  between  March  and  July  from  142  to  167.  Wheat,  No. 
1,  northern  spring,  shot  from  $1.98  per  bushel  in  March  to  $2.58  in 
July.  The  index  number  for  the  fuels  group,  in  which  a  variation  is 
of  only  less  general  consequence  than  in  the  food  group,  rose  from 

131  in  March  to  168  in  July.    The  clothing  group  index  number  rose 
from  157  to  187  in  the  same  period,  the  building  materials  group  from 

132  to  155,  and  the  chemicals  group  from  159  to  180.    It  is  scarcely 
necessary  to  look  further  than  the  final  upward  swing  of  prices  from 
our  entrance  into  war  until  July,  for  the  immediate  reason  why  the 
Government  began  formally  to  control  prices  late  in  the  summer  of 
1917. 

2.  THE  CONDITIONS  THAT  THREATENED  FURTHER 

RISES. 

The  extraordinary  rises  in  price,  that  gave  occasion  for  price  con- 
trol shortly  after  our  entrance  into  war,  were  the  outcome  of  several 
large  forces.  Quite  apart  from  the  excitement  thrown  into  the 
market  by  war  speculation,  there  had  arisen  difficult  problems  of 
production,  distribution,  and  purchasing  which  forced  prices  higher 
each  day.  A  knowledge  of  these  problems,  which  at  bottom  were  the 
cause  of  rising  markets,  affords  a  clearer  vision  of  what  lay  back  of 
Government  price  control  than  does  a  mere  review  of  price  rises. 

1  The  prewar  price  was  taken  as  100. 


30 


HISTORY   OF   PRICES   DURING   THE   WAR. 


(i)   THE  EUROPEAN   DEMANDS  UPON  AMERICAN   PRODUCTION. 

The  increased  demands  upon  domestic  production,  which  our  going 
into  war  brought  the  Government  squarely  to  face  in  1917,  was  the  first 
problem  of  great  magnitude.  The  productive  capacity  of  the  country 
was  largely  under  contract  to  allied  Governments,  when  our  own 
Government  began  itself  to  need  materials.  But  the  European  de- 
mands, notwithstanding,  kept  mounting  by  leaps  and  bounds.  Europe 
had  taken  $1,471,266,488  in  value  of  our  exports,  which  was  somewhat 
in  excess  of  her  usual  peace-time  requirements,  during  the  year  end- 
ing June  30,  1914.  But  as  she  waged  war  she  turned  to  the  United 
States  for  more  raw  materials,  manufactures  and  foods,  and  during 
the  year  ending  June  30,  1917,  took  $4,307,310,138.1  This  enormous 
and  sudden  demand  for  American  materials,  of  course  helped  prices 
higher. 

The  western  European  Allies  (United  Kingdom,  France,  Italy, 
and  Belgium),  in  order  to  meet  their  annual  consumption  of  over 
900,000,000  bushels  of  wheat,  have  ordinarily  to  import  100,000,000 
bushels  from  the  United  States  and  450,000,000  bushels  from  other 
countries.  This  country  produces  about  800,000,000  bushels  of  wheat 
each  year,  and,  since  the  domestic  consumption  normally  is  near  646,- 
000,000,  the  European  demand  can  readily  be  supplied.  But  the  esti- 
mated harvest,  at  the  time  America  entered  war,  came  to  only  635,- 
000,000  bushels,  thus  leaving  no  probable  surplus  for  exportation.  It 
became  clear  that  if  this  country  maintained  a  normal  consumption,  it 
could  ill  afford  Europe  her  usual  100,000,000  bushels.  The  Allies 
of  Europe  in  1917,  moreover,  were  getting  hungry  and  could  not 
be  satisfied  with  anything  short  of  an  extraordinary  importation. 
They  must,  it  seemed,  too,  avoid  the  long  hauls  from  India,  Aus- 
tralia, or  South  America  and  buy  from  the  United  States.  Siberian 
wheat,  indeed,  was  less  accessible  than  that  from  Australia,  and  the 
Russian  port  of  Odessa  had  been  shut  off  from  western  Europe  by 
the  closing  of  the  Dardanelles.  Thus  in  the  spring  of  1917  the 
United  States  was  made  the  Mecca  of  Allied  wheat  buyers,  and  the 
largest  sales,  both  for  cash  and  for  future  delivery,  were  made  to 
the  Governments  of  Europe.  To  meet  these  large  European  de- 

1  The  total  domestic  exports  in  dollars  from  the  United  States  to  Europe,  for  the  year  ending  June  30, 
1913,  to  that  ending  June  30, 1918,  follow: 


Year. 

Actual. 

Rela- 
tive. 

Year. 

Actual. 

Rela- 
tive. 

1913 

$1  464  005  220 

100 

1916    

$2  972  349  994 

203 

1914 

1  471  266  488 

100 

1917 

4  307  310  138 

294 

1915 

1*944  '327  132 

133 

1918    

3  707  309,057 

253 

GOVERNMENT   CONTROL   OVER   PRICES. 


31 


mands,  America  had  the  smallest  wheat  crop  since  1911.1  The 
frenzy  of  buying,  which  seized  the  wheat  markets  of  the  country 
shortly  after  we  entered  war  and  sent  prices  violently  upward,  was 
one  of  the  most  pressing  among  the  factors  that  prompted  the  Gov- 
ernment to  begin  price  control,  with  a  view  both  to  increasing 
production  and  stabilizing  prices. 

The  United  States  ordinarily  consumes  3,950,000  short  tons  of 
sugar  each  year,  of  which  she  imports  from  foreign  sources  or  insu- 
lar possessions  77  per  cent.2  A  full  half  of  that  total  supply  comes 
from  Cuba  and  Porto  Rico.  The  United  Kingdom  ordinarily  con- 
sumes 2,060,000  short  tons  of  sugar,  of  which  she  imports  100  per 
cent.  Since  war  suddenly  cut  off  her  normal  importation  of  70  per 
cent  of  that  amount  from  Germany  and  Austria,  Great  Britain  like- 
wise turned  toward  Cuba  and  Porto  Rico  for  sugar.  It  soon  came 
about  that  the  great  bulk  of  sugar  consumed  by  England  and  all  of 
the  allied  countries,  therefore,  was  imported  from  the  United  States 
and  Cuba.  The  sugar  exports  from  this  country  mounted  from 
96,862,462  pounds  in  the  year  prior  to  the  European  war  to 
1,685,195,537  pounds  in  1916.3  This  drain  upon  Cuban  and  American 
stocks  forced  sugar  prices  upward,  until  the  Government  was  driven 
to  interfere. 

i  The  official  data  showing  wheat  produced  in  the  United  States  during  the  war  period,  the  exports  of 
domestic  wheat,  and  the  value  of  wheat  exports  follow: 


Year. 

Production. 

Exports. 

Exports. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

1913.   . 

Bushels. 
730.267,000 
763,380,000 
891,017,000 
1.025,801,000 
636,318,000 
636,655,000 

100 
105 
.122 
140 
87 
87 

Bushels. 
142,879,597 
145,590,349 
332,464,976 
243,117,026 
203.573,928 
133,990,150 

100 
102 
233 
170 
142 
94 

$89,036,428 
87,953,456 
333,552.226 
215,532,681 
298,179,705 
80,  802,  542 

100 
99 
375 
242 
335 
91 

1914. 

1915 

1916 

1917. 

1918. 

2  Calculated  upon  data  for  the  prewar  years  from  1909  to  1914. 

3  The  revolution  in  the  sugar  situation  as  it  affected  American  prices,  is  graphically  pictured  by  the 
following  comparison  of  the  world's  production  of  sugar  during  the  war,  the  total  supply  of  sugar  in  the 
United  States  found  by  adding  production  and  imports,  and  the  total  sugar  exports: 


Year. 

World's  production. 

United  States  supply. 

United  States  Ex- 
ports. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

1913. 

Pounds. 
40,787,743,360 
41,972,098,560 
41,511,919,680 
37,069,106,080 
37,728,530,560 
38,374,804,160 

100 
103 
102 
91 
92 
94 

Pounds. 
8,301,046,168 
8,890,657,390 
9,228,077,077 
9,645,558,299 
9,735,794,417 
8,679,250,840 

100 
107 
111 
116 
117 
105 

Pounds. 
66,569,033 
96,862,462 
601,103,749 
1,685,195,537 
1,268,306,254 
588,521,143 

100 
145 
903 
2,531 
1,905 
884 

1914 

1915... 

1916  

1917..   .   . 

1918..   . 

32 


HISTORY   OF   PRICES   DURING   THE   WAR. 


Another  pressure  upon  American  production  early  in  1917,  with 
a  consequent  inducement  to  higher  prices,  was  the  demand  in 
Europe  for  our  metals.1  The  total  exports  of  iron,  steel,  and  their 
manufactures,  which  were  $251,480,677  in  value  for  the  year  imme- 
diately prior  to  the  war  in  Europe,  had  jumped  to  $1,133,746,188 
by  1917.  The  prewar  exports  of  copper,  in  like  manner,  were 
$146,222,556  in  value  and  had  been  forced  by  European  war  re- 
quirements to  $322,535,344  by  1917.  These  data  explain  why  metal 
prices  in  this  country  got  out  of  hand  until  their  record  rise  in 
July,  1917,  brought  the  Government  to  regulate  them. 

(2)   THE  BREAKDOWN  IN  COAL  DISTRIBUTION. 

The  increased  demand  for  our  coal  in  Europe,  unlike  that  for 
others  of  our  materials,  was  not  an  appreciable  factor  in  the  fluctua- 
tions of  coal  prices,  since  the  export  tonnage  of  neither  anthracite  nor 
bituminous  coal  amounted  in  any  year  to  more  than  5  per  cent  of  their 
respective  productions.  But  there  was,  of  course,  a  tremendously 
increased  domestic  demand  incited  by  war  orders.  The  produc- 
tion of  bituminous  coal,  which  constitutes  85  per  cent  of  the  Ameri- 
can output,  jumped  in  1917  to  a  record  figure  for  this  country, 
551,790,563  tons. 

It  is  a  curious  anomaly,  explained  only  by  the  breakdown  in  our 
distribution  by  railroads  and  boats,  that  during  June,  1917,  when 
the  problem  was  especially  acute,  the  production  of  bituminous  coal 
rose  to  123  per  cent  of  its  prewar  level,  while  the  price  rose  to  297 

1  There  follows  a  comparison  of  the  actual  domestic  production  of  pig  iron  with  the  corresponding 
European  demands  as  represented  roughly  by  our  exports  (domestic)  of  iron,  steel  and  their  manufactures 
during  the  war;  and,  in  like  manner,  a  comparison  of  the  copper  produced  in  this  country  with  the  exports 
of  domestic  copper  and  its  manufactures.  A  convenient  tool  by  which  to  compare  the  variations  in  pro- 
duction and  exports  has  been  made,  by  turning  each  actual  figure  into  a  relative  figure,  using  the  respective 
prewar  average  (1913)  as  a  base  equal  to  100. 


Year. 

Pig-ironproduction. 

Iron,  steel,  and  their 
manufactures,    ex- 
ports. 

Copper  production. 

Copper  and  its  man- 
ufactures, exports. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

1913 

Lonq  tons. 
29,726,937 
30,  966,  152 
23,  332,  244 
29,  916,  213 
39,  434,  797 
38,647,397 

100 
104 
79 
101 
133 
130 

$304,  605,  797 
251,480,677 
225,861,387 
621,  237,  972 
1,  133,  746,  188 
1,  124,  999,  211 

100 
83 
74 
204 
372 
369 

Pounds. 
1,224,484,098 
1,  150,  137,  192 
1,388,009,527 
1,  927,  850,  548 
1,886,120,721 
1,910,000,000 

100 
94 
113 
157 
154 
X56 

$140,  164,  913 
146,222,556 
99,558,030 
173,  946.  226 
322.535,344 
268,982,821 

100 
104 
71 
124 
230 
192 

1914  

1915     

1916  

1917     . 

1918 

GOVERNMENT    CONTROL    OVER    PRICES. 


33 


per  cent.1  The  heavy  demands  upon  the  railroads  for  the  transpor- 
tation of  war  materials,  despite  the  extraordinary  production  of  coal 
at  the  mines  awaiting  cars,  created  a  local  shortage  which  forced 
prices  higher  and  finally  brought  Government  interference. 

(3)  THE  SHORTAGE  OF  SHIPS. 

A  shortage  of  available  ships  for  use  in  transporting  goods, 
though  always  an  appreciable  factor  in  determining  the  prices  of 
commodities  at  their  import  and  export  markets,  has  seldom  affected 
domestic  prices  as  in  1917.  The  United  States  Shipping  Board,  had 
there  been  no  war  drain  upon  vessels,  would  have  given  an  adequate 
relief.  But  when  this  country  entered  the  war  its  main  immediate 
responsibility  was  to  recuperate  the  allied  tonnage  and  turn  ships 
into  war  uses  with  scant  regard  for  commercial  considerations.  The 
result  was  a  revolution  in  our  foreign  trading,  which  disturbed 
vitally  many  prices  of  commodities  normally  imported  and  others 
awaiting  exportation. 

The  total  acquisitions  of  ships  by  the  United  States  from  April  6 
to  July  31,  1917,  the  especially  acute  period,  exceeded  the  total 
losses.  This  country,  in  other  words,  gained  95  vessels,  making  a 
total  of  268,969  gross  tons,  and  lost  68  vessels,  making  a  total  of 

i  The  following  table  compares  the  actual  fluctuations  in  the  production  of  bituminous  coal  in  the  United 
States  by  years  from  1913  to  1918,  and  by  months  during  1917,  with  the  corresponding  fluctuations  in  prices. 
A  ready  comparison  of  the  variations  in  production  and  prices  has  been  facilitated  by  the  reduction  of 
each  actual  figure  to  a  relative  figure,  using  the  respective  prewar  figure  (average  from  July  1, 1913,  to  June 
30,  1914)  as  a  base  equal  to  100. 


•    Date. 

Actual. 

Relative. 

Production. 

Price. 

Production. 

Prirc. 

Year: 
1913 

Tons. 
478,435,297 
422,703,970 
442,624,426 
502,518,545 
551,  790,  .563 
585,883,000 

$1.29 
1.22 
1.19 
1.78 
3.08 
2.67 

105 
92 
97 
110 
121 
128 

102 
94 
94 
140 

243 
210 

1914 

1915  :.. 

1916.. 

1917 

1918  

Months,  1917: 
January 

47,967,354 
41,352,711 
47,868,652 
41,854,320 
47,086,452 
46,824,646 
46,291,572 
47,372,226 
45,107,956 
48,337,726 
47,689,801 
44,037,147 

3.73 
3.75 
3.53 
3.00 
3.72 
3.77 
2.98 
3.03 
2.12 
2.15 
2.58 
2.59 

126 
108 
126 
110 
124 
123 
121 
124 
118 
127 
125 
116 

294 
295 
276 
236 
293 
297 
235 
239 
167 
169 
203 
204 

February 

March.... 

April... 

Mav 

June  

July 

August  

September 

October 

November              .  .  . 

December.  .  . 

Year  

551,790,563 

3.08 

121 

243 

125547°— '< 


34 


HISTORY   OF   PRICES   DURING   THE   WAR. 


109,188  gross  tons.1  But  the  fearful  shortage  altogether  of  allied 
and  neutral  tonnage  during  1917,  which  one  time  threatened  the  loss 
of  the  war,  made  our  few  domestic  increases  seem  a  pittance.  The 
allied  and  neutral  tonnage,  through  losses  from  submarines  and 

ALUED  AND  NEUTRAL  SEAGOING  TONNAGE 
Lost  and  Built 


Allied  and  neutral  seagoing  tonnage,   lost  and  built. — By  months,   February,   1917,   to 
September,  1918. 

other  causes,  began  falling  off  seriously  after  our  entrance  into  war, 
and  it  was  not  until  May  of  1918  that  the  building  program  could 
be  made  to  overtake  the  current  losses. 

1  There  follows  a  summary  of  the  changes  in  United  States  seagoing  merchant  marine,  500  gross  tons 
and  over,  as  prepared  by  the  Division  of  Planning  and  Statistic?  of  the  United  States  Shipping  Board 
from  Aug.  1,  1914,  to  Nov.  11, 1918. 


Period. 

Acquisitions. 

Losses. 

Number 

Gross  tons 

Number 

Gross  tons 

United  States  seagoing  documented  vessels,  exclusive  of 
seized  enemy  and  requisitioned  Dutch  vessels: 
Aug  1   191-1  to  Apr  5  1917 

406 
95 
704 

1,392,887 
268,969 
2,  292,  531 

286 
68 
233 

529,  529 
109,188 
507,  519 

(978  days  intervening.) 
Apr.  6,  1917,  to  July  31,  1917  

(116  davs  intervening.) 
Au1"   1   1917  to  Nov  11   1918 

(467  days  intervening.) 
Total.                               .  .  . 

1,205 

3,954,387 

587 

1,146,236 

N7essels  seized  from  enemies  by  United  States: 
Apr  6  1917  to  July  31   1917 

96 
1 

640,  582 
8,312 

Aug.  1,  1917,  to  Nov.  11,  1918  

9 

88,081 

Total  

97 

648,  894 

9 

88,  081 

Vessels  requisitioned  from  Dutch  by  United  States: 
April,  1918,  to  Nov.  11,  1918 

87 

354,  278 

6 

25,359 

GOVERNMENT    CONTROL   OVER   PRICES.  35 

3.  THE  DESIRE  OF  THE  GOVERNMENT  TO  MAKE  ITS 
OWN  PURCHASES  AT  REASONABLE  COSTS. 

The  desire  of  the  Government  to  make  its  own  purchases  at  rea- 
sonable costs,  after  the  country  went  to  war,  and  the  enormous  quan- 
tity of  materials  required,  might  have  had  a  very  much  more  disas- 
trous effect  upon  prices  generally  than  appears  upon  the  surface.  It 
was  patent  that  the  taking  of  an  enormous  quantity  of  any  material 
by  the  Government  at  a  low  figure  would  not  of  itself  hold  prices  to 
the  public  at  the  same  figure.  The  presumption  was,  on  the  other 
hand,  that  civilian  competition  for  the  residue  stock  would  usually 
quicken  and  force  open-market  prices  higher.  The  President  early 
in  the  summer  of  1917  saw  that  a  control  over  Government  purchases 
alone  might  unduly  raise  prices  for  the  remaining  stocks  of  the  same 
commodity,  and  declared  for  a  single  price  to  the  Government,  the 
public,  and  the  Allies. 

4.  THE  GROWING  DISCONTENT  WITH  RISING  PRICES  OF 

STAPLES. 

The  war-time  rise  in  the  prices  of  staples  prior  to  our  entrance  into 
war  was  tolerated  without  complaint  by  the  labor  and  middle  classes, 
in  the  main,  because  there  came  with  those  increased  prices  a  some- 
what increased  prosperity.  A  general  discontent  developed,  however, 
when  prices  mounted  higher  after  mobilization  began  reducing  thou- 
sands of  family  budgets  by  taking  men  into  camps.  The  earmarks 
of  profiteering  appeared  at  every  turn  during  the  spring  of  1917, 
and  embittered  those  less  able,  who  were  making  honest  sacrifices  to 
help  win  the  war.  Many  believed  it  the  duty  of  the  Government 
to  protect  them  from  exorbitant  charges  for  the  staple  commodities, 
and  urged  this  course  until  finally  the  Congress  set  up  the  machinery 
for  a  control  over  food  and  fuel  prices. 

5.  THE  INFLUENCE  OF  BRITISH  AND  FRENCH 
CONTROLS. 

The  initial  handicap  which  the  Government  had  to  overcome  in 
solving  the  problems  that  came  to  the  fore  in  the  spring  of  1917, 
however  obvious  it  may  have  appeared  that  regulation  would  effec- 
tively overcome  them,  was  the  conservative  prejudice  against  Gov- 
ernment control.  It  can  not  be  denied  that  the  industries  of  the 
country  at  the  outset  generally  looked  askance  or  with  fear  upon  in- 
terference with  their  business.  The  actual  experience  with  control 
in  England  and  France  helped,  as  nothing  else  could,  to  quiet  these 
fears.  The  country  generally  did  not  know  the  detail  of  European 


36  HISTORY   OF   PRICES   DURING   THE    WAR. 

regulations.  But  the  American  business  interests  came  to  appre- 
ciate, through  their  own  and  British  experience  witli  rising  prices, 
that  war-time  stabilization  in  prices  could  not  be  sustained  without 
help  from  the  Government.  The  one-time  opposition  to  Government 
regulation,  as  price  problems  became  more  complex,  turned  gradually 
into  requests  for  control  from  the  industries  themselves. 


PART  II. 

THE    ADMINISTRATION    OF    PRICE    CONTROLS 
DURING  THE  WAR. 


i.  THE  AGENCIES  DELEGATED  AND  THE  CONTROLS 
WHICH  THEY  EXERCISED. 

The  Government  was  loath  to  begin  any  regulations  of  prices  until 
forced  into  it  by  excessive  rises  in  price  or  by  the  fear  of  erratic  mar- 
kets. It  then  proceeded  with  caution  and  extended  control  over 
the  prices  of  commodities  at  wholesale  in  piecemeal  fashion.  It  so 
happened  that  the  prices  of  wheat,  sugar,  metals,  and  coal  which 
proved  the  most  notable  instances  of  regulation  throughout  the  war, 
were  taken  in  hand  after  the  epochal  rises  of  the  midsummer  and  had 
all  been  put  under  control  by  the  end  of  September,  1917.  The  slight 
machinery  then  set  up  formed  the  nucleus  for  the  mechanism  by  which 
prices  were  controlled  during  the  war. 

There  are  three  methods  by  which  to  survey  each  formal  Govern- 
ment price  control,  from  the  setting  of  a  minimum  wheat  price  by  law 
on  August  10,  1917,  to  the  withdrawal  of  the  last  regulation  after  the 
signing  of  the  armistice.  The  regulations  may  be  arranged  chrono- 
logically by  dates  upon  which  each  commodity  came  under  control; 
they  may  be  grouped  under  natural  commodity  divisions;  or  they 
may  be  classed  under  the  war  boards  which  exercised  the  controls. 
The  latter  scheme  seems  altogether  the  most  useful,  since  it  permits 
a  chronological  listing  under  each  board  at  least  and  happens  to  afford 
a  rough  grouping  of  similar  commodit}^  controls.  The  various  ad- 
ministrative boards,  among  which  the  responsibility  for  Government 
controls  were  distributed  at  the  signing  of  the  armistice,  moreover, 
grew  up  in  part  because  there  were  distinct  kinds  of  control  problems. 

The  delegation  of  regulatory  powers  over  prices  by  the  President 
during  the  war  was  prompted  by  reasons  of  expediency  rather 
than  logic.  Price-control  authority  in  various  degrees  was  given  to 
the  Food  Administration,  the  Fuel  Administration,  the  War  Indus- 
tries Board,  the  Price  Fixing  Committee,  the  War  Trade  Board, 
the  War  Department,  the  Xavy  Department,  the  Federal  Trade 
Commission,  and  the  Department  of  Agriculture. 

The  Food  Administration,  Avhich  was  created  by  authority  con- 
ferred on  the  President  in  the  food  and  fuel  control  act  of  August  10, 
1917,  was  gradually  given  war-time  control  over  virtually  the  whole 

37 


38  HISTORY   OF   PRICES   DURING   THE   WAR. 

food  group  including  wheat,  flour,  and  bread ;  sugar ;  live  stock  and 
meats;  poultry  and  dairy  products;  oleomargarine;  cotton  seed  and 
cottonseed  products ;  canned  and  dried  foods ;  rice  and  rice  flour : 
coarse  grains  and  feedstuffs;  coffee;  ammonia;  ice;  and  arsenic.  The 
War  Industries  Board,  which  was  made  a  division  within  the  Council 
of  National  Defense  on  July  28,  1917,  and  a  separate  board  on  May 
28,  1918,  exercised  control  in  the  main  over  the  prices  of  the  great 
basic  raw  materials  until  the  price  fixing  committee  was  appointed. 
Even  after  that  it  exercised  control  over  lead,  nickel,  quicksilver, 
platinum,  manganese,  burlap,  wood  chemicals,  and  alkalis.  The  price- 
fixing  committee,  wThich  was  appointed  by  the  President,  took  over 
from  the  War  Industries  Board  on  March  14,  1918,  the  task  of  fixing 
basic  raw-material  prices  and  regulated  the  prices  of  iron,  steel,  and 
their  products,  copper,  aluminum,  zinc,  cotton  textiles,  cotton  linters, 
wrool,  hides,  skins,  and  leather,  hemp,  lumber,  building  materials,  and 
acids.  The  Fuel  Administration,  which  with  the  Food  Administra- 
tion was  authorized  by  the  food  arid  fuel  control  act,  exercised  full 
control  over  the  prices  of  anthracite  and  bituminous  coal  and  coke. 
The  War  Trade  Board,  wrhich  wras  created  by  the  President  under 
authority  from  the  espionage  and  trading-with-the-enemy  acts,  was 
given  control  over  imports  and  exports,  and  sometimes  used  its  license 
power  indirectly  to  help  control  prices,  especially  of  rubber,  foreign 
wool,  silk,  quebracho,  castor  beans,  and  castor  oil.  The  Army  and 
Navy,  by  their  power  to  requisition  and  commandeer,  controlled  prices 
in  part  for  their  own  purchases.  The  Federal  Trade  Commission 
compiled  extensive  cost  data  for  the  price-control  agencies  and  itself 
controlled  certain  paper  prices.  Lesser  controls  were  exercised  by  the 
Department  of  Agriculture. 

(i)   THE   PRESIDENT   MADE  A  MINISTER   OF  PRICE   CONTROLS. 

The  Congress  did  not  grant  to  the  President,  or  to  any  agency,  blan- 
ket authority  to  work  out  a  schematic  program  of  general  price 
regulation  during  the  war.  The  bases  in  law  for  different  regulations 
were  varied  and  sometimes  doubtful.  The  country  early  got  at  the 
business  of  regulating  prices,  despite  its  one-time  caution,  because 
the  President  deemed  it  necessary  himself  to  become  in  reality  a 
minister  of  price  controls.  There  was  no  disposition,  once  the  food 
and  fuel  control  bill  was  law,  to  await  specific  authorization  by  the 
Congress  when  a  war  purpose  made  any  price  control  imperative. 
The  whole  body  of  regulations  relating  to  prices,  whether  specifically 
allowed  by  legislative  enactment  or  set  up  loosely  under  war  powers, 
took  their  final  administrative  authority  from  the  President. 

It  is  noteworthy  that  even  the  food  and  fuel  control  act,  which 
was  the  one  broad  grant  of  regulatory  powers  over  prices  made  by 
the  Congress,  gave  power  simply  to  the  President  and  made  no  men- 


GOVERNMENT   CONTROL   OVER  PRICES.  39 

tion  of  either  a  Food  Administration  or  a  Fuel  Administration.  It 
permitted  the  President  to  control  foods  and  fuels  and  he,  of  his  own 
accord,  appointed  to  represent  him  a  Food  Administrator  and  a  Fuel 
Administrator.  These  latter,  in  turn,  set  up  huge  organizations  as 
their  tools  of  administration.  There  was  scarcely  a  fragment  of 
authority  for  the  final  organization  of  the  War  Industries  Board, 
other  than  the  President's  well  known  letter  of  March  4,  1918.  The 
price-fixing  committee  was  appointed  by  the  President  to  represent 
him  in  fixing  maximum  prices  and  without  definite  citation  of  legis- 
lative authority.  The  War  Trade  Board,  too,  was  an  instrument  of 
the  President.  The  resting  of  final  responsibility  upon  the  President 
for  the  administration  of  price  controls  .was,  in  point  of  fact,  more 
literal  than  might  appear,  since  he  himself  undertook  to  approve  and 
to  sign  a  majority  of  the  regulations.  An  account  follows  of  the 
various  agencies  through  which  he  administered  price  control,  with 
an  analysis  of  the  individual  controls  undertaken. 


2.  THE  FOOD  ADMINISTRATION. 

A  chronicle  in  detail  of  the  planning  and  administration  of  food 
control  during  the  war  can  scarcely  be  had  from  any  available 
records.  The  United  States  Food  Administration  can  not  itself  re- 
count all  of  the  controls  which  it  administered,  so  multifarious  wrere 
they  in  number,  so  informal  in  kind,  and  so  altered  from  day  to  day. 
The  regulation  of  food  prices  was  at  once  the  most  nebulous  w7ar  con- 
trol exercised  in  America,  and  the  most  far-reaching  and  direct  in  its 
touch  with  the  civilian  and  the  soldier.  It  was  extended  to  cover,  in 
one  form  or  another,  virtually  every  staple  food  commodity  and 
others  of  lesser  importance. 

The  nature  of  food  control  in  this  country  during  war  time  was 
distinguished  sharply  from  that  of  raw-material  control.  The  prices 
of  raw  materials  were,  in  the  main,  definitely  fixed.  The  prices 
of  foods  were  controlled  instead  by  a  flexible  and,  often,  loosely 
applied  system  of  margins.  The  raw-material  control  was  a  very 
much  more  tangible  thing  than  the  food  control.  It  is  relatively  a 
simple  task  to  determine  upon  a  line  where  price  fixing  of  raw 
materials  stops  and  other  kinds  of  control  begin.  But  a  study  of 
Government  control  over  the  prices  of  foodstuffs  involves  an  account 
of  control  over  production,  allocation  of  sales,  distribution,  priorities 
of  manufacture  and  transportation,  conservation  of  uses,  amounts 
allowed  for  export  and  import  and  the  allotments  of  shipping  space. 
It  is  not  apparent  at  first  sight  whether  these  controls  are  features 
of  price  regulation  or  not.  Only  a  detailed  examination  of  each  in- 
stance of  control  will  give  a  proper  basis  to  judge  which  of  those 
controls  affected  particular  prices,  and  which,  therefore,  merit  con- 
sideration in  a  study  of  Government  control  over  prices. 

The  real  beginnings  of  food  control  were  made  the  clay  following 
our  entrance  into  wyar,  when  the  Council  of  National  Defense  cabled 
Mr.  Herbert  Hoover  a  request  that  he  become  its  advisor  upon  food 
and  price  problems.  Mr.  Hoover,  in  reponse  to  that  and  a  later 
cablegram  from  the  President,  arrived  at  New  York  from  Europe  on 
May  3,  1917,  and  set  up  an  office,  with  a  stenographer,  in  a  hotel  at 
I/ Washington  on  the  following  morning. 

The  President  was  anxious  to  start  a  study  of  the  food  problem 
at  once  and,  pending  legislation,  appointed  Mr.  Hoover  Food  Ad- 
ministrator of  the  United  States  on  May  17.  There  was,  meantime, 
no  authority  for  any  thoroughgoing  regulation,  but  the  newly  ap- 
pointed Food  Administrator,  under  special  allowances  from  the 
40 


GOVERNMENT   CONTROL   OVER   PRICES.  41 

President's  emergency  fund,  laid  the  foundations  for  a  food-control 
law.  He  had,  by  the  time  the  food  bill  was  passed,  already  built 
up  a  staff  of  450  persons.  At  his  instance  during  that  interim, 
furthermore,  over  100  conferences  were  held  with  the  trade,  im- 
portant informal  agreements  were  readied,  and  contacts  cemented 
that  determined  the  later  courses  of  action.  Too  little  emphasis 
might  easily  be  given  to  the  length  of  the  step,  from  free  competi- 
tion and  soaring  prices  at  our  declaration  of  war  into  price  control. 
Mr.  Hoover,  fresh  from  Europe  and  in  touch  with  the  food,  military, 
submarine,  and  shipping  situations,  was  in  a  peculiarly  strategic 
position  to  help  hasten  that  transition.  He  impressed  the  country 
with  the  belief  that  the  Allies  were  in  more  immediate  need  of  food 
than  of  men ;  that  the  shortage  of  ships  made  it  expedient  that  this 
food  come  largely  from  North  America,  since  shipments  from  Aus- 
tralia or  Argentina  would  require  two  and  three  times  as  much  ton- 
nage, respectively,  to  haul  an  equal  amount;  that  the  Allies  would 
need  perhaps  500,000,000  bushels  of  wheat  beyond  their  own  crops 
for  the  next  year,  and  close  to  1,000,000,000  bushels  of  all  cereals; 
that  there  was  prevalent  a  speculation  in  wheat,  prompted  by  bidding 
for  the  residue  available  for  export,  which  had  already  boosted  the 
price  of  flour  from  $9  to  $15  per  barrel.  These  facts  were  told  in  a, 
straightforward  manner  the  country  over,  and  acted  as  a  leaven 
preparing  the  way  for  Government  control.  The  American,  not  ac- 
customed to  war-time  control,  reacted  favorably  when  told  that  his 
own  wheat  could  be  exported  across  the  Atlantic,  and  made  into 
bread  that  sold  there  under  Government  control,  at  a  price  in  Bel- 
gium amounting  to  6.0  per  cent  of  the  price  which  he  paid  at  New 
York ;  in  France,  at  a  price  40  per  cent  below  his  own ;  and  in  Eng- 
land at  a  price  30  per  cent  below  his  own.  This  propaganda,  backed 
strongly  by  the  President,  and  the  general  confidence  in  Mr.  Hoover 
inspired  by  his  long  and  intimate  contact  with  food  control  in  Bel- 
gium, France,  and  England,  was  the  force  which  got  the  United 
States  promptly  into  the  business  of  controlling  her  foodstuffs  by 
the  summer  of  1917. 

The  debates  in  Congress  upon  the  so-called  Lever  bill  began  im- 
mediately after  its  introduction  on  June  11,  and  dragged  on,  as  the 
President  believed  in  a  "tedious  and  vexatious"  manner,  for  the 
whole  of  two  months.  But,  pressing  as  the  wheat  and  sugar  situa- 
tions seemed  then  for  more  immediate  action,  the  long  drawn-out 
hearings  and  discussions  during  the  summer  did  teach  the  Govern- 
ment and  the  country  much  about  their  problem.  The  bill  was 
finally  made  into  the  food-control  act  on  August  10,  1917.  That  act 
set  forth  the  basis  of  all  later  food  control,  granted  wide  powers  to 
the  President  under  which  he  created  the  United  States  Food  Ad- 
ministration, and  fi^ecl  a  minimum  price  for  wheat.  It  gave  legal 


42  HISTORY   OF   PRICES  DURING   THE   WAR. 

status,  really,  to  all  that  Mr.  Hoover  had  done  at  Washington  of  an 
informal  character  in  the  three  months  previous.  There  were  pro- 
posed at  the  Capitol  scores  of  amendments,  some  of  which  were 
written  into  the  bill  and  gave  it  different  character,  but  altogether 
the  law  as  signed  by  the  President  set  up  the  kind  of  control  for 
which  he  and  Mr.  Hoover  had  long  asked. 

(i)   THE  FOOD-CONTROL  ACT. 

The  food-control  act,  made  from  the  Lever  bill,  and  sometimes 
called  the  food  and  fuel  control  net,  was  the  most  important  measure 
for  controlling  prices  which  the  United  States  took  during  the  war 
or  had  ever  taken.  It  was  the  basis  for  the  whole  of  war-time  control 
of  food  and  fuel  as  well.  It,  more  than  any  other  statute,  requires 
an  analysis  in  this  inquiry. 

THE  PURPOSES  OF  THE  ACT. 

The  declared  purpose  of  the  act,  and  the  sweeping  control  which 
it  held  in  contemplation,  can  be  pictured  no  more  impressively  than 
through  a  repetition  of  the  terminology  written  into  the  law.  The 
act  states  as  its  aim — 

to  assure  an  adequate  supply  and  equitable  distribution,  and  to  facilitate  the 
movement,  of  foods,  feeds,  fuel,  including  fuel  oil  and  natural  gas,  and  fertilizer 
and  fertilizer  ingredients,  tools,  utensils,  implements,  machinery,  and  equip- 
ment required  for  the  actual  production  of  foods,  feeds,  and  fuel,  hereafter  in 
this  act  called  necessaries;  to/prevent,  locally  or  generally,  scarcity,  monopoli- 
zation, hoarding,  injurious  speculation,  manipulations,  and  private  controls 
affecting  such  supply,  distribution,  and  movement;  and  to  establish  and  main- 
tain governmental  control  of  such  necessaries  during  the  war — 

and  authorizes  the  President  to  issue  any  regulations  or  orders  neces- 
sary to  carry  out  its  provisions.  It  makes  the  purposes  of  Congress 
even  more  definite,  by  the  specific  acts  which  it  declares  unlawful- 
it  is  hereby  made  unlawful  for  any  person  willfully  to  destroy  any  neces- 
saries for  the  purpose  of  enhancing  the  price  or  restricting  the  supply  thereof ; 
knowingly  to  commit  waste  or  willfully  to  permit  preventable  deterioration  of 
any  necessaries  in  or  in  connection  with  their  production,  manufacture,  or 
distribution;  to  hoard,  as  denned  in  section  6  of  this  act,  any  necessaries;  to 
monopolize  or  attempt  to  monopolize,  either  locally  or  generally,  any  neces- 
saries ;  to  engage  in  any  discriminatory  and  unfair,  or  any  deceptive  or  waste- 
ful practice  or  device,  or  to  make  any  unjust  or  unreasonable  rate  or  charge, 
in  handling  or  dealing  in  or  with  any  necessaries ;  to  conspire,  combine,  agree, 
or  arrange  with  any  other  person,  (a)  to  limit  the  facilities  for  transporting, 
producing,  harvesting,  manufacturing,  supplying,  storing,  or  dealing  in  any 
necessaries;  (b)  to  restrict  the  supply  of  any  necessaries;  (c)  to  restrict  dis- 
tribution of  any  necessaries;  (d)  to  prevent,  limit,  or  lessen  the  manufacture 
or  production  of  any  necessaries  in  order  to  enhance  the  price  thereof;  or  (e) 
to  exact  excessive  prices  for  any  necessaries,  or  to  aid  or  abet  the  doing  of  any 
act  made  unlawful  by  this  section — 

and  which  comprehend  very  nearly  all  private  abuses  pertinent  to  the 
war-time  food  problem. 


GOVERNMENT    CONTROL   OVER   PRICES.  43 

The  outstanding  feature  of  the  whole  act  is  the  kind  of  control  by 
which  it  proposes  to  accomplish  these  ends.  The  Congress,  in  full 
knowledge  of  the  various  experiences  of  England  and  France,  deter- 
mined finally  that  the  domestic  situation  lent  itself  more  readily  to 
a  system  of  license  control  over  the  manufacture  and  distribution  of 
foods  than  to  a  system  either  of  fixed  or  maximum  prices.  The 
transition  to  a  war-time  basis,  it  was  felt,  should  be  made  more 
gradual  than  either  of  the  latter  alternatives  would  permit.  It  was 
believed,  too,  that  the  patriotism  of  the  people  could  be  relied  upon 
to  carry  through  the  less  rigid  program  of  control.  Other  features 
of  especial  note  in  the  act  were  the  powers  which  it  delegated  to  the 
President  to  requisition  "  necessaries  " ;  to  purchase  or  store  wheat, 
flour,  meal,  beans,  and  potatoes ;  to  take  over  for  use  or  operation  by 
the  Government  factories  or  plants  manufacturing  "necessaries"; 
to  regulate  or  prohibit  operations  of  exchanges  and  boards  of  trade ; 
to  commandeer  distilled  spirits;  and  to  fix  the  prices  of  coal  and 
coke.  It  was  this  law  also  which  guaranteed  a  minimum  price  of 
$2  per  bushel  for  wheat,  binding  until  May,  1919,  and  provided  that 
the  President  might  fix  a  higher  price  at  his  discretion. 

THE  LICENSE  SYSTEM. 

The  backbone  of  the  administration  of  war-time  control  over  foods 
lay  in  the  license  system  and  the  many  rules  and  regulations  which 
were  imposed  upon  all  who  came  under  it.  The  law  itself  set  up 
control  over  no  particular  commodities,  with  the  exception  of  wheat. 
It  simply  gave  the  President  power,  by  issuing  proclamations  from 
time  to  time,  to  bring  under  license  control  dealers  in  those  com- 
modities which  he  and  the  Food  Administrator  wanted  to  regulate. 
The  name  of  every  class  of  food  that  was  controlled,  presumably, 
may  be  found  in  the  different  proclamations  made  by  the  President 
between  August  10,  1917,  and  the  close  of  war,  in  which  he  declared 
that  dealers  in  the  foodstuffs  specified  must  secure  a  license  from  the 
Food  Administration  before  doing  further  business.  The  first  of 
these  proclamations,  aside  from  the  Executive  order  issued  the  day 
the  law  was  signed  creating  the  Food  Administration  and  appoint- 
ing Herbert  Hoover  as  Food  Administrator,  was  issued  August  14, 
1917,  and  called  for  the  licensing  of  wheat  and  rye  elevators  and 
millers.  By  all  odds  the  most  important  of  all  the  proclamations  was 
that  of  October  8,  1917,  which  called  in  substance  for  the  licensing 
of  every  dealer  in  any  staple  food  commodity.  It  provided  for  the 
licensing  of  manufacturers  and  distributors  of  wheat,  rye,  barley, 
flours,  oats,  oatmeal,  corn,  cornmeal,  rice,  dried  beans  or  peas,  cot- 
ton seed,  vegetable  oils,  lard,  milk,  butter,  cheese,  beef,  pork,  mutton, 
poultry,  eggs,  fish,  fruits,  vegetables,  canned  goods,  dried  fruits,  and 
sugar.  Proclamation  by  proclamation  the  list  of  dealers  from  whom 


44  HISTORY   OF   PRICES   DURING   THE   WAR. 

licenses  were  required  was  extended,  until  at  the  end  virtually  the 
whole  food  group  was  under  license  control.1 

The  discretion  left  by  the  act  to  the  administrators  for  the  deter- 
mination of  dealers  who  may  be  licensed  was  exceeded  in  scope  only 
by  that  left  to  them  for  the  determination  of  foods  that  may  be 
put  under  license  control.  The  law  in  no  sense  tied  the  hands  of 
the  food  administrators  in  the  latter  respect.  It  gave  them  power  to 
control  any  and  all  foods  or  feeds.  There  were,  moreover,  but  few 
dealers  in  those  foods  or  feeds  whom  they  might  not  bring  under 
license  control.  The  substance  of  the  law  was  that  all  persons  en- 
gaged in  the  importation,  manufacture,  storage,  mining,  or  distribu- 
tion of  any  necessaries  might  be  licensed.  But  two  exceptions  espe- 
cially important  were  made  to  that  general  rule.  The  law  specifically 
exempted  from  license  control  all  farm  and  garden  producers  and  all 
retailers  whose  gross  annual  sales  fell  below  $100,000. 

1  The  President  signed  8  Executive  orders  and  19  proclamations  under  this  art  iVom 
Aug.  10,  1917,  to  Nov.  25,  1918,  as  follows  : 

EXECUTIVE   ORDERS. 

Aug.  10,  1917.  Providing  for  organization  of  United  States  Food  Administration. 

Aug.  14,  1917.  Providing  for  organization  of  Food  Administration  Grain  Corporation. 

Sept.  2,  1917.  Directing  Treasury  Department  to  enforce  sees.  15  and  16  of  food-control 
act. 

Sept.  27,  1917.  Providing  for  appointment  of  secretaries  to  Federal  food  administra- 
tors without  civil-service  examination. 

Oct.  23,  1917.  Providing  for  requisitioning  of  foods  and  feeds. 

Nov.  10,  1917.  Amending  civil-service  regulations. 

Nov.  27,  1917.  Authorizing  United  States  Food  Administrator  to  find  that  fair  profit 
is  normal  average  prewar  profit. 

June  21,  1918.  Designating  Food  Administration  Grain  Corporation  as  agency  of  United 
States  to  purchase  wheat,  and  directing  that  capital  stock  be  increased. 
B 

PBOCLAMATIONS. 

Aug.  14,  1917.  Licensing  of  wheat  and  rye  elevators  and  millers. 

Sept.  7,  1917.  Licensing  of  importers,  manufacturers,  and  refiners  of  sugar,  sugar 
sirups,  and  molasses. 

Oct.  8,  1917.   Licensing  of  manufacturers  and  distributors  of  certain  food  commodities. 

Nov.   7,   1917.   Licensing  bakers. 

Nov.  15,  1917.   Licensing  of  arsenic  industry. 

Dec.  8,  1917.  Limiting  alcoholic  content  of  malt  liquor. 

Jan.  3,  1918.  Licensing  of  ammonia  industry. 

Jan.  10,  1918.  Licensing  the  importation,  manufacture,  storage,  and  distribution  of 
feeds  and  certain  other  food  commodities. 

Jan.   18,   1918.  Conservation  of  wheat.    • 

Jan.  30,  1918.  Licensing  of  bakers  not  already  licensed,  and  importers  and  distributors 
of  green  coffee. 

Feb.  21,  1918.  Fixing  guaranteed  prices  for  1918  wheat  crop. 

Feb.  25,  1918.  Licensing  of  fertilizer  industry. 

May  14,  1918.  Licensing  of  farm-equipment  industry. 

May  14,  1918.  Licensing  packers  of  canned  tuna  and  others. 

June  18,   1918.  Licensing  of  stockyards. 

Sept.  2,  1918.  Fixing  guaranteed  prices  for  1919  wheat  crop. 

Sept.  6,  1918.  Licensing  of  dealers  in  live  or  dead  cattle,  sheep,  swine,  or  goats. 

Sept.  16,  1918.  Prohibiting  manufacture  of  malt  liquors. 

Nov.  2,  1918.  Licensing  operators  of  warehouses  storing  goods  and  feeds  for  hire  and 
others. 


GOVERNMENT    CONTROL    OVER    PRICES.  45 

THE  TEETH  OF  THE  STATUTE. 

There  were  put  into  the  statute  itself,  quite  apart  from  any  regu- 
lations which  the  Food  Administration  might  later  set  up  under  it, 
enforcement  clauses  which  were  powerful  weapons  in  the  admin- 
istration of  its  provisions.  It  contained  the  threat  of  a  fine  of 
$5,000  or  $10,000  against  violators  of  nearly  every  section  in  the 
law,  or  imprisonment  for  not  more  than  four  or  five  years.  The 
law,  in  the  famous  section  4,  specifically  declared  it  to  be  unlawful 
to  destroy  any  necessaries  for  the  purpose  of  enhancing  the  price; 
to  waste  necessaries ;  to  hoard  necessaries ;  to  monopolize  necessaries ; 
to  make  any  unjust  or  unreasonable  rate  or  charge  in  handling  neces- 
saries ;  to  restrict  the  facilities  for  transporting,  producing,  harvest- 
ing, manufacturing,  supplying,  storing,  or  dealing  in  necessaries; 
to  restrict  the  distribution  of  necessaries ;  or  to  exact  excessive  prices 
for  any  necessaries.  This  section,  though  the  most  sweeping  in  its 
statement  of  unlawful  practices,  left  some  ambiguity  as  to  penalties 
for  its  enforcement.  There  was,  moreover,  written  into  the  law  an 
authorization  for  the  President  to  requisition  foods,  and  another  for 
him  to  make  purchases.  Those  powers,  however  little  exercised, 
stood  always  as  effective  potential  instruments.  But,  quite  aside 
from  these  penalties  in  the  law,  there  was,  of  course,  a  much  more 
effective  instrument  in  the  appeal  to  a  war-time  spirit  of  cooperation. 
By  no  other  price-control  agency  at  Washington  were  there  set  up 
so  many  legal  and  patriotism-arousing  devices  for  the  enforcement 
of  their  regulations. 

THE  FIXING  OF  A  MINIMUM  PRICE  FOR  WHEAT. 

The  fixing  of  a  minimum  price  for  wheat  is  another  phase  of  the 
food-control  act  which  deserves  especial  note,  both  because  of  its  own 
merit  and  because  it  represents  a  distinct  break  in  policy  with  the 
rest  of  the  act.  Wheat  was  the  only  commodity  for  which  the  law 
fixed  a  price.  It  was  the  only  food  commodity  for  which  the  law 
specifically  stated  that  a  price  might  be  fixed.  But  even  the  license 
section,  so  many  believe,  opened  a  way  for  fixing  food  prices  to  be 
charged  by  licensees.  In  any  case,  there  was  left  no  doubt  what  was 
to  be  done  about  wheat.  A  definite  guarantee  of  $2  per  bushel  for 
all  No.  1  Northern  spring  wheat,  at  Chicago,  was  made  for  deliveries 
up  to  May  1,  1919.  The  prices  of  equivalent  wheats  or  other  stand- 
ard grades  at  various  markets  were  to  be  figured,  upon  that  scale, 
by  the  official  grain  standards  established  under  the  United  States 
grain-standards  act.  The  President,  while  not  permitted  to  set 
aside  this  guaranteed  minimum  price  fixed  in  law,  was  given 


46  HISTORY   OF   PRICES   DURING   THE   WAR. 

power  to  increase  the  guaranteed  minimum  from  time  to  time  to 
encourage  production.  In  point  of  fact  he  did  increase  that  mini- 
mum to  $2.20  for  the  1918  crop,  by  proclamation  on  February  21, 
1918,  and  again  to  $2.26,  for  the  1919  crop,  by  proclamation  on  Sep- 
tember 2,  1918.  The  effectiveness  of  the  guarantee  was  assured  by 
an  authorization  to  purchase  any  wheat,  if  occasion  demanded,  for 
which,  a  minimum  price  had  been  guaranteed. 

The  food-control  bill  was  enacted  into  law  only  through  the 
pressure  of  war  emergencies  and,  in  keeping  with  the  arguments 
i\vhich  were  used  for  its  passage,  contains  a  clause  that  it  shall  cease 
to  be  in  effect  when  the  President  shall  proclaim  that  the  war  against 
Germany  has  terminated. 

(2)  THE  POLICIES  OF  THE  FOOD  ADMINISTRATOR. 

The  considerable  leeway  in  control  over  food  which  the  act  gave 
to  the  President  makes  peculiarly  important  an  analysis  in  full  of 
the  policies  of  his  Food  Administrator.  The  act,  with  a  single  con- 
spicuous exception,  left  wide  powers  with  the  President  which  he 
might  or  might  not  use.  The*  policies  of  food  control  in  which  Mr. 
Herbert  Hoover  believed,  therefore,  can  not  but  call  for  careful 
consideration. 

Mr.  Hoover  returned  to  this  country  with  his  mind  fully  adjusted 
to  and  familiar  with  the  several  experiences  with  food  control  in 
in  Europe.  The  President,  after  issuing  his  own  general  program 
for  food  control  on  May  19,  1917,  depended  upon  the  advice  and 
leadership  of  Mr.  Hoover  for  establishing  a  proper  administration 
of  control.  There  was  scarcely  a  limit  of  regulatory  experience 
which  had  not  been  tried  out  abroad.  The  British  food  controller 
at  our  entrance  into  war,  indeed,  had  already  been  given  power 
to  set  minimum  or  maximum  prices  and  to  fix  prices  absolutely. 
Those  facts  were  outlined  to  the  Government  by  Mr.  Hoover  within 
a  week  after  his  return.1  It  is  noteworthy  in  the  light  of  these 
and  later  developments  that  Mr.  Hoover  upon  his  arrival  laid 
before  the  President  these  five  cardinal  principles  of  food  control: 
First,  that  the  food  problem  is  one  rather  of  wise  administration 
than  "  dictatorship " ;  second,  that  administration  can  be  carried 
out  largely  through  constituted  agencies  of  producers,  distributors, 
and  consumers ;  third,  the  organization  of  the  community  for  volun- 
teer conservation  of  foodstuffs;  fourth,  that  all  important  positions, 
so  far  as  may  be,  shall  be  filled  with  volunteers;  and  fifth,  the 
centering  of  independent  responsibility  for  food  administration 
directly  under  the  President,  with  cooperation  from  the  Department 

1  Letter  from  Mr.  Hoover  to  the  Secretary  of  State  of  date  May  10,  1917. 


GOVERNMENT    CONTROL   OVER   PRICES.  47 

of  Agriculture,  the  Department  of   Commerce,  the   Federal  Trade 
Commission,  and  the  railway  executives.1 

Mr.  Hoover  at  the  outset  of  -his  administration  settled  upon  the 
policies  of  control  for  which  he  intended  to  work  and  upon  the  gen- 

1  President  Wilson,  on  May  19,  1917,  soon  after  the  return  of  Mr.  Hoover  from 
Europe,  appointed  Mr.  Hoover  as  Food  Administrator  pending  legislation  and  issued  the 
following  program  for  food  control : 

"  It  is  very  desirable,  in  order  to  prevent  misunderstandings  or  alarms  and  to  assure 
cooperation  in  a  vital  matter,  that  the  country  should  understand  exactly  the  scope  and 
purpose  of  the  very  great  powers  which  I  have  thought  it  necessary  in  the  circumstances 
to  ask  Congress  to  put  in  my  hands  with  regard  to  our  food  supplies.  Those  powers  are 
very  great,  indeed,  but  they  are  no  greater  than  it  has  proven  necessary  to-  lodge  in 
the  other  Governments  which  are  conducting  this  momentous  war,  and  their  object  is 
stimulation  and  conservation,  not  arbitrary  restraint  or  injurious  interference  with  the 
normal  processes  of  production.  They  are  intended  to  benefit  and  assist  the  farmer  and 
all  those  who  play  a  legitimate  part  in  the  preparation,  distribution,  and  marketing  of 
foodstuffs. 

"  It  is  proposed  to  draw  a  sharp  line  of  distinction  between  the  normal  activities  of 
the  Government  represented  in  the  Department  of  Agriculture  in  reference  to  food  pro- 
duction, conservation,  and  marketing,  on  the  one  hand,  and  tho  emergency  activities 
necessitated  by  the  war  in  reference  to  the  regulation  of  food  distribution  and  consump- 
tion, on  the  other.  All  measures  intended  directly  to  extend  the  normal  activities  of 
the  Department  of  Agriculture  in  reference  to  the  production,  conservation,  and  tho 
marketing  of  farm  crops  will  be  administered,  as  in  normal  times,  through  that  depart- 
ment, and  the  powers  asked  for  over  distribution  and  consumption,  over  exports,  imports, 
prices,  purchase,  and  requisition  of  commodities,  storing,  and  the  like,  which  may  require 
regulation  during  the  war  will  be  placed  in  the  hands  of  a  commissioner  of  food  admin- 
istration, appointed  by  the  President  and  directly  responsible  to  him. 

OBJECTS    SOUGHT   BY    LEGISLATION. 

"  The  objects  sought  to  be  served  by  the  legislation  asked  for  are  :  Full  inquiry  into 
the  existing  available  stocks  of  foodstuffs  and  into  the  costs  and  practices  of  the  various 
food  producing  and  distributing  trades ;  the  prevention  of  all  unwarranted  hoarding 
of  every  kind  and  of  the  control  of  foodstuffs  by  persons  who  are  not  in  any  legitimate 
sense  producers,  dealers,  or  traders  ;  the  requisitioning,  when  necessary  for  the  public  use, 
of  food  supplies  and  of  the  equipment  necessary  for  handling  them  properly  ;  the  licensing 
of  wholesome  and  legitimate  mixtures  and  milling  percentages,  and  the  prohibition  of 
the  unnecessary  or  wasteful  use  of  foods. 

"  Authority  is  asked  also  to  establish  prices,  but  not  in  order  to  limit  the  profits  of  the 
farmers,  but  only  to  guarantee  to  them  when  necessary  a  minimum  price  which  will 
insure  them  a  profit  where  they  are  asked  to  attempt  new  crops  and  to  secure  the 
consumer  against  extortion  by  breaking  up  corners  and  attempts  at  speculation,  when 
they  occur,  by  fixing  temporarily  a  reasonable  price  at  which  middlemen  must  sell. 

"  I  have  asked  Mr.  Herbert  Hoover  to  undertake  this  all-important  task  of  food 
administration.  He  has  expressed  his  willingness  to  do  so  on  condition  that  he  is  to 
receive  no  payment  for  his  services  and  that  the  whole  of  the  force  under  him,  exclusive 
of  clerical  assistance,  shall  be  employed,  so  far  as  possible,  upon  the  same  volunteer 
basis.  He  has  expressed  his  confidence  that  this  difficult  matter  of  food  administration 
can  be  successfully  accomplished  through  the  voluntary  cooperation  and  direction  of 
legitimate  distributers  of  foodstuffs  and  with  the  help  of  the  women  of  the  country. 

"Although  it  is  absolutely  necessary  that  unquestionable  powers  shall  be  placed  in  my 
hands  in  order  to  insure  the  success  of  this  administration  of  the  food  supplies  of  the 
country,  I  am  confident  that  the  exercise  of  these  powers  will  be  necessary  only  in  the 
few  cases  where  some  small  and  selfish  minority  proves  unwilling  to  put  the  Nation's 
interests  above  personal  advantage,  and  that  the  whole  country  will  heartily  support 
Mr.  Hoover's  efforts  by  supplying  the  necessary  volunteer  agencies  throughout  the  country 
for  the  intelligent  control  of  food  consumption  and  securing  the  cooperation  of  the  most 
capable  leaders  of  the  very  interests  most  directly  affected,  that  the  exercise  of  the 
powers  deputed  to  him  will  rest  very  successfully  upon  the  good  will  and  cooperation  of 
the  people  themselves,  and  that  the  ordinary  economic  machinery  of  the  country  will  be 
left  substantially  undisturbed. 

FOOD    ADMINISTRATION    ONLY    WHILE    WAR    LASTS. 

"  The  proposed  food  administration  is  intended,  of  course,  only  to  meet  a  manifest 
emergency  and  to  continue  only  while  the  war  lasts.  Since  it  will  be  composed  for  the 
most  part  of  volunteers,  there  need  be  no  fear  of  the  possibility  of  a  permanent 


48  HISTORY   OF   PRICES    DURIXG   THE    WAR. 

eral  skeleton  of  organization  by  which  he  hoped  to  administer  them. 
The  general  approach  to  his  problem,  from  an  organization  stand- 
point, seems  to  have  come  to  him  before  the  detailed  policies  of  con- 
trol. He  gave  out  again  and  again  during  the  spring  of  1917  state- 
ments that  food  control  to  him  fell  into  four  great  branches:  First, 
the  control  of  exports;  second,  the  setting  up  of  instrumentalities  to 
regulate  or  do  away  with  speculation;  third,  the  mobilization  of 
I  he  women  and  men  of  the  country  engaged  in  personal  distribution 
of  foods  as  actual  members  of  the  Food  Administration  to  carry  out 
national  conservation;  and,  fourth,  the  erection  in  every  State  of  a 
Federal  State  food  administration  and  the  decentralization  so  far  as 
possible  of  functions  into  State  administrations.  Of  this  organiza- 
tion plan  for  control  no  more  need  here  be  said.  But  the  policies  of 
control  which  were  worked  out  under  that  broad  plan  do  require 
especial  analysis.  In  a  word,  it  may  be  said  that  the  outstanding 
policies  of  the  Food  Administrator  were  those  declaring  against  fix- 
ing absolute  prices,  the  "  reasonable  margin  of  profit "  rule,  the 
disregard  of  replacement  value  in  fixing  margins,  the  spirit  of  co- 
operation extended  to  the  trade,  and  the  faith  that  was  placed  upon 
campaigns  of  education. 

Xo  FIXED  PRICES  ESTABLISHED. 

Xo  other  policy  of  the  Food  Administrator  bore  as  much  signifi- 
cance perhaps,  or  showed  so  distinctly  in  the  act,  as  the  policy  not  to 
fix. prices  in  the  common  sense.  It  matters  little  for  the  purpose  at 
hand  whether  that  was  from  the  outset  a  determined  policy,  based 
upon  European  experiences,  or  one  forced  by  the  exigencies  of  a 
political  situation.  The  food  control  act  as  passed  does  not,  at  any 
rate,  specifically  empower  the  fixing  either  of  minimum,  absolute  or 
maximum  prices  on  foodstuffs.1  It  appears,  in  fact,  to  be  an  act 
designed  quite  as  much  to  control  the  manufacture,  distribution,  and 
conservation  of  commodities  within  the  food  industry  as  to  control 
the  prices  of  foods.  But  the  impression  must  not  be  harbored  that 
the  act  was  loosely  drawn  or  toothless  even  as  to  the  point  at  issue  in 

bureaucracy  arising  out  of  it.  All  control  of  consumption  will  disappear  when  the 
emergency  has  passed.  It  is  with  that  object  in  view  that  the  administration  considers 
it  to  he  of  pre-eminent  importance  that  the  existing  associations  of  producers  and  dis- 
tributors of  foodstuffs  should  be  mobilized  and  made  use  of  on  a  volunteer  basis.  The 
successful  conduct  of  the  projected  food  administration  by  such  means  will  be  the  finest 
possible  demonstration  of  the  willingness,  the  ability,  and  the  efficiency  of  democracy 
and  of  its  justified  reliance  upon  the  freedom  of  individual  initiative.  The  last  thing 
that  any  American  could  contemplate  with  equanimity  would  be  the  introduction  of 
anything  resembling  Prussian  autocracy  into  the  food  control  of  this  country. 

"  It  is  of  vital  interest  and  importance  to  every  man  who  produces  food  and  to  every 
man  who  takes  part  in  its  distribution  that  these  policies  thus  liberally  administered 
should  succeed  and  succeed  altogether.  It  is  only  in  that  way  that  we  can  prove  it  to  he 
absolutely  unnecessary  to  resort  to  the  rigorous  and  drastic  measures  which  have  proved 
to  be  necessary  in  some  of  the  European  countries." 

1  The  one  exception  to  that  policy  was  wheat. 


GOVERNMENT   CONTROL   OVER   PRICES.  49 

this  monograph.  The  contrary  was  so  distinctly  true  that,  had  occa- 
sion demanded,  foods  could  have  been  requisitioned  without  further 
legislation.  Mr.  Hoover,  though  more  in  touch  with  the  need  for  food 
abroad  than  anyone  else,  did  not  believe  that  it  was  necessary  for 
this  country  to  be  put  upon  a  ration  basis  at  once,  or  even  a  fixed- 
price  basis.  He  believed  that  a  sufficient  saving  and  price  control 
could  be  effected  through  approximate  measures.  In  a  broad  way  it 
appeared  to  him  simply  that  war-time  demands  had  given  rise  to 
speculation  and  destroyed  the  ordinary  balances  and  checks  upon 
prices.  He  had  in  mind  at  the  beginning,  therefore,  no  rigid  price 
fixing,  but  a  stimulation  of  patriotism  which  would  set  the  country 
at  large  to  saving  food,  help  the  administration  to  check  speculation, 
and  restore  the  "  balance  wheel  on  prices." x  The  motto  for  the 
Nation,  indeed,  which  Mr.  Hoover  gave  out  just  following  his  accept- 
ance of  the  food  administratorship  was  "  Eat  plenty,  wisely,  without 
waste.''  It  was  left  to  him  to  set  up  more  stringent  regulations  later 
on  as  each  situation  required.2 

THE  "  REASONABLE  MARGIX-OF-PROFIT  "  UULE. 

The  real  price  control  within  the  Food  Administration  came  from 
its  common  requirement  that  licensees,  covering  dealers  virtually  in 
all  food  commodities,  should  not  receive  more  than  a  "  reasonable 
margin  of  profit."  This  rule,  prohibiting  unreasonable  profits,  was 
incorporated  in  the  general  license  regulations.  It  was  thereby 
made  applicable  to  all  licensees,  save  only  salt-water  fishermen,  for 
the  importation,  manufacture,  storage,  and  distribution  of  food  com- 
modities and  feeds.  A  somewhat  broader  definition  of  the  "  reason- 
able-margin-of-profit "  rule  may  be  had  from  the  language  of  the 
general  regulations : 

The  licensee  shall  not  import,  manufacture,  store,  distribute,  sell,  or  other- 
wise handle  any  food  commodities  on  any  unjust,  exorbitant,  unreasonable,  dis- 
criminatory, or  unfair  commission,  profit,  or  storage  charge. 

This  general  requirement,  that  profits  of  all  licensees  be  reason- 
able, does  not  indicate  what  would  be  considered  a  reasonable  profit. 
The  question  arises  at  once,  What  did  the  Food  Administrator  be- 

1  It  is  difficult  to  find  a  more  precise  statement  of  the  early  policies  of  Mr.  Hoover 
upon  price  control  of  foods  than  that  which  he  .eavo  in  a  statement  on  May  19,  1917,  as 
follows  :  "  The  consequence  is  that  a  sudden  demand  or  concerted  effort  of  speculation 
can  entirely  upset  price  conditions  in  the  United  States  to  a  degree  hitherto  unknown, 
and  it  is  necessary  for  us  to  devise  with  the  hest  thought  of  this  country  a  temporary 
balance  by  which  we  can  establish  stability  of  prices  in  the  great   staples,  bearing  in 
mind  always  that  we  must  maintain  production  by  assuring  good  return  to  the  producer, 
and  at  the  same  time  will  diminish  the  cost  of  living,  lest  we  face  social  readjustments 
and  strike  disturbances,  with  consequent  loss  of  national  efficiency." 

2  The  testimony  of  Mr.  Hoover  before  the  Senate  Committee  on  Agriculture  and  For- 
estry on  May  8,  1917,  throws  some  light  upon  his  reactions  to  the  experience  of  Europe 
with  maximum  and  minimum  prices  for  foodstuffs.     It  is  here  quoted  in  part: 

"  Senator  BRADY.  Do  you  feel  that  we  should  make  a  minimum  price  on  farm  products? 

"  Mr.   HOOVER.   On  the  price  question  there  are  in  this  world  three  conceptions  :  The 

agricultural  population  in  this  country  or  any  other  country  would  like  to  have  a  mini- 

125547°— 20 i 


50  HISTORY   OF   PRICES   DURING   THE   WAR. 

lieve,  as  a  general  policy  to  guide  him  in.  issuing  special  regulations, 
was  a  reasonable  profit?  The  working  out  of  that  general  policy 
gave  shape  to  three  rather  definite  phases  of  the  rule:  That  the 
"  reasonable  margin  of  profit "  must  be  figured  upon  a  cost  basis,  the 
fixing  of  maximum  margins  of  profit,  and  the  disregard  of  replace- 
ment value  in  fixing  margins. 

mum  price.  Tlie  minimum  price  is  a  protection  solely  to  the  producer,  and  it  is  capable 
of  execution,  because  such  a  thing  would  probably  be  backed  by  the  Government  who 
could  pay  the  money.  Now,  the  consumer,  on  the  other  hand,  clamors  for  a  maximum 
price  to  protect  him.  A  maximum  price  has  proved  a  total  failure  in  Europe  in  every 
case,  except  where  the  Government  owned  enough  of  the  commodity  that  it  could  control 
the  market. 

"Senator  NORRIS.  Has  the  minimum  price  been  succeessful  there? 

"  Mr.  HOOVEK.  Yes  ;  it  has  been  used  as  an  effective  agent  to  stimulation. 

"Senator  NORUIS.  The  maximum  price  has  proved  a  failure? 

"  Mr.  HOOVER.  The  maximum  price  has  proved  a  failure  in  all  cases,  except  where  the 
Government  controlled  enough  of  the  commodity.  I  might  make  that  clear  by  stating 
that  the  French  Government  imported  last  year  about  25  per  cent  of  their  breadstuffs 
requirements  and  bought  those  breadstuffs  for  the  Government  and  used  that  as  a  club 
to  maintain  the  maximum  price,  but  in  all  commodities  where  there  is  no  club  of  that 
character  the  maximum  price  is  a  total  failure. 

"  Senator  WADS  WORTH.  From  the  standpoint  of  the   consumer? 

"  Mr.  HOOVER.  Well,  as  a  matter  of  operation.  I  might  tell  you  w'iy  it  fails.  The 
establishment  of  a  maximum  price  is,  in  itself,  the  result  of  a  shortage  of  supply  ;  other- 
wise, we  do  not  do  it.  You  have  less  foodstuffs  than  will  go  around  to  the  whole  of  the 
consumers'  demand,  and  therefore  you  put  on  a  maximum  price. 

"  Senator  GRONNA.  Which  discourages  production,  does  it  not — the  maximum  price? 

"  Mr.  HOOVER.  It  all  depends  on  the  price. 

"  Senator  GRONNA.  But  in  order  to  satisfy  the  consumer  it  would  naturally  discourage 
production? 

"  Senator  SMITH  of  Georgia.  Unless  it  was  high? 

"  Mr.  HOOVER.  Unless  it  was  high. 

"  Senator  GRONNA.  That  would  not  satisfy  the  consumer? 

"  Mr.  HOOVER.  No  ;  but  just  to  elaborate  the  reasons  why  it  failed,  you  find  imme- 
diately when  a  maximum  price  is  established  that  all  of  the  consumers  of  the  country 
who  can  open  a  chain  directly  with  the  producer  at  once  do  so,  and  they  not  only  open 
a  chain  for  their  daily  needs,  but  they  proceed  to  hoard  at  once,  and  the  phenomenon 
accompanying  a  maximum  price — I  think  Dr.  Taylor  will  confirm  this — has  been  the 
total  disappearance  of  that  commodity  all  the  way  from  a  fortnight  to  three  months  from 
the  normal  market,  because  those  minority  consumers  who  can  reach  the  producer  directly 
will  absorb  the  whole  supply  and  they  will  make  their  own  bargains,  and  often  if  they 
do  make  it  they  set  up  a  cycle  ;  and  it  has  been  an  economic  failure,  except  where  there 
has  been  a  club  to  enforce  it. 

"  The  CHAIRMAN.  A  maximum  price  that  was  too  low  would  have  that  effect  anyway, 
would  it  not — the  consumption  of  the  total  supply? 

"  Mr.  HOOVER.  If  you  have  a  shortage  in  supply,  there  is  no  maximum  price  that  holds. 
You  can  put  it  as  high  as  you  like  where  there  is  insufficiency  of  supply. 

"  Senator  SMITH  of  Georgia.  The  maximum  price  has  only  been  effectual  where  the 
Government  controlled  the  commodity  and  put  the  price  down  so  as  to  put  the  commodity 
in  reach  of  the  people,  and  that  very  act  checks  exorbitant  price. 

"  Mr.  HOOVER.   Yes.     They  could,  in  effect,  manipulate  the  price  if  they  wanted  to. 

"  Senator  BRADY.  From  the  trend  of  your  interesting  statement  (regarding  wheat  and 
other  control  abroad),  Mr.  Hoover,  it  seems  to  me  it  leads  to  the  axing  of  an  arbitrary 
price  rather  than  a  minimum  or  maximum  price? 

"  Mr.  HOOVER.  That  is  our  view ;  that  is  our  experience  in  Belgium  ;  we  come  to  fix 
an  arbitrary  price.  I  might  say  that  was  discussed  between  myself  and  the  English  food 
controller  and  the  French  food  controller,  but  they  did  not  have  to  do  it,  because  they 
have  the  import  implement  of  control  by  which  they  could  handle  the  market." 


GOVERNMENT   CONTROL  OVER   PRICES.  51 

THE  COST  BASIS. 

The  first  phase  of  the  "  reasonable  margin  of  profit "  rule  was  so 
important  that  it  came  frequently  itself  to  be  known  as  the  "  cost 
basis  "  rule.  It  was,  however,  in  reality,  simply  a  part  of  the  larger 
rule.  It  stated  that  the  cost  of  the  commodity,  rather  than  the 
market  value,  should  be  the  starting  point  from  which  to  figure  the 
"  reasonable  margin  of  profit "  allowable.  The  food-control  act  gave 
no  authority  to  demand  that  anybody  should  sell  goods  below  the 
actual  cost,  and  there  was  no  means,  therefore,  if  there  had  been 
inclination,  to  enforce  a  basic  price.  The  design  of  the  law,  ap- 
parently, was  simply  to  prohibit  the  exaction  of  unreasonable  prices 
in  foodstuffs.  A  basic  price,  it  was  believed,  even  if  set,  would 
necessarily  have  had  to  be  near  the  prevailing  market.  That  general 
practice  then  would  have  given  enormous  profits  to  dealers  who  had 
bought  their  goods  through  contract  a  year  previous  at  lower  fig- 
ures. It  was  the  inclination  of  the  trade,  naturally,  to  have  the 
Food  Administration  begin  to  calculate  a  "  reasonable  margin  of 
profit "  from  the  market  value  or  cost  of  replacement.  The  admin- 
istrators of  food  control  stuck  in  principle,  however,  to  the  cost  of 
the  goods  as  the  proper  basis  for  determining  profits  allowable 
throughout  the  war. 

Once  it  was  determined  to  accept  costs  as  the  base,  above  which  a 
"  reasonable  "  profit  would  be  allowed,  an  interpretation  pf  "  reason- 
able" was  imperative.  Mr.  Hoover  gave  emphasis  to  Jiis  belief  that 
no  person  was  entitled  to  make  more  profit  from  *any  employment 
than  he  could  have  made  under  prewar  conditions.1  He  did  not 
interpret  this  policy  to  mean,  however,  that  no  licensee  could  charge 
more  than  a  prewar  price.  A  due  allowance  was  made  for  in- 
creased cost  of  raw  materials,  labor,  and  manufacture.  The  word 
"  reasonable "  was  construed*  to  mean  the  average  percentage  of 
profit  made  in  prewar  jtimes  (taking  the  three  years  prior  to  the 
European  war  as  a  basis)  on  the  same  commodity,  with  an  even 
market,  and  under  freely  competitive  conditions.  One  of  the  strong- 
est or  weakest  features  of  the  "reasonable  margin  of  profit"  rule, 
according  to  the  point  of  view,  is  that  it  sets  up  no  uniform  or  fixed 
price  for  a  particular  commodity  at  various  markets  or  within  the 
same  market.  Each  dealer  is  allowed  his  "reasonable"  margin  of 
profit.  It  becomes  patent  that  the  effectiveness  of  the  rule  depends 
upon  the  rigor  of  its  enforcement.  That  rule  was,  in  any  event, 
the  bulwark  of  price  control  administered  over  foods. 

1  Mr.  Hoover,  in  a  speech  before  the  Pittsburgh  Press  Club  on  April  18,  1918,  said  in 
part  :  "  I  do  not  believe  that  any  person  in  the  United  States  has  a  right  to  make  1  cent 
more  profit  out  of  any  employment  than  he  would  have  made  under  prewar  conditions,  r 
I  do  not  care  whether  this  refers  to  the  farmer,  to  the  laborer,  to  the  manufacturer,  to 
the  middleman,  or  to  the  retailer.  To  me  every  cent  taken  beyond  this  standard  is  money 
abstracted  from  the  blood  and  sacrifice  of  the  American  people." 


52  HISTORY   OF   PRICES   DURING   THE   WAR. 

FIXING  MAXIMUM   WHOLESALE  AND  RETAIL  MARGINS. 

The  scheme  of  holding  food  profits  to  a  "  reasonable  "  margin  of 
profit  underwent  some  evolution  before  it  was  finally  determined  to 
fix  definite  maximum  margins  for  wholesalers  and  later  for  retailers. 
The  earlier  difficulties  were  really  gropings  for  a  mechanism  by 
which  to  find  the  average  prewar  nonspeculative  profits.  At  first  the 
dealer  was  allowed  to  base  his  present  profits  upon  his  prewar  per- 
centage of  profits.  For  example,  if  he  made  10  per  cent  on  canned 
tomatoes  before  the  war,  he  might  make  10  per  cent  on  them  during 
the  war.  But  since  the  prices  of  canned  tomatoes  had  materially  ad- 
vanced during  the  war,  of  course,  10  per  cent  of  absolute  profit  over 
a  war-time  price  meant  more  to  the  dealer  than  that  percentage  had 
meant  over  his  prewar  price.  This  extra  profit,  in  a  general  way, 
was  assumed  necessary  to  cover  increased  investment  and  costs  of 
doing  business.  But  neither  the  trade  nor  the  Food  Administration 
was  pleased  with  that  interpretation  of  the  rule.  It  at  once  put  a 
handicap  upon  the  conscientious  dealer  and  left  the  Food  Adminis- 
tration no  definite  standard  for  enforcing  the  law.  No  one  could 
say,  in  a  clear-cut  way,  what  the  law  was. 

The  final  step  in  control  by  margins  was  reached  when,  on  April 
6,  1918,  the  Food  Administration  announced  a  series  of  definite 
maximum  margins  of  profit  allowable  on  the  more  important  staples 
at  wholesale.  There  had  been  fear,  in  working  out  the  plan,  that  the 
low-cost  dealers  would  increase  their  profits  to  the  basis  of  the  widely 
applicable,  and  therefore,  higher  margins.  A  definitely  fixed  mar- 
gin might  be  reasonable  for  one  dealer  but  afford  excessive  profits 
to  another.  Accordingly,  it  was  determined  to  fix  a  high  and  low 
maximum  margin  upon  each  item.  The  higher  margin  was  to  be 
made  applicable  to  the  dealers  with  high  costs,  and  the  lower  margin 
to  those  with  relatively  low  costs.  In  order  not  to  destroy  compet- 
itive conditions  tending  to  reduce  prices  below  the  maximum,  neither 
margin  was  made  a  minimum  one.  They  were  simply  maxima,  be- 
yond which  profits  would  not  prima  facie  be  considered  reasonable 
or  lawful.  It  was  a  great  relief  to  the  trade,  and  the  administrators, 
to  have  definite  margins  prescribed  as  standards  and  it  made,  alto- 
gether, for  better  results.  The  Distribution  Division,  indeed,  at- 
tributed to  it  a  material  reduction  in  average  profits  by  reason,  in 
part,  of  its  easier  enforcement.  Soon  it  was  possible  to  dispense 
with  the  jobbers'  monthly  reports  and  enforce  the  rule  by  aid  sim- 
ply of  inspections  and  special  reports.  . 

It  ought  to  be  made  clear  that  the  maximum  margins  were  not 
final,  definite  standards.  It  was  conceivable  that  they  might  be 
exceeded  lawfully  or  that  dealers  making  less  than  they  stipulated 
might  be  taking  unreasonable  profits.  They  were  the  maximum  mar- 


GOVERNMENT    CONTROL   OVER   PRICES.  53 

gins  of  profit  which  the  Food  Administration,  without  further  evi- 
dence, would  consider  reasonable.  An  individual  who  believed  them 
too  low  must  take  the  burden  of  proof  upon  himself  to  show  that 
his  profits  in  excess  of  the  announced  margins  were  reasonable.  But, 
as  a  matter  of  practise,  the  margins  operated  as  definite  standard 
maxima  which  were  not  to  be  exceeded  in  any  case.  On  the  other 
hand,  the  institution  of  these  fixed  maximum  margins  did  not  (until 
June  6,  1918)  abrogate  the  rule  that  no  man  could  make  more  than 
a  reasonable  profit,  even  though  that  profit  was  less  than  the  maxi- 
mum prescribed. 

The  Food  Administration,  between  April  6,  1918,  and  the  sign- 
ing of  the  armistice,  announced  maximum  margins  on  sales  by 
wholesalers  to  retailers  on  a  large  number  of  the  more  important 
staples  (sugar,  wheat  and  other  flour,  lard,  lard  substitutes,  stand- 
ard hams,  bacon,  condensed  and  evaporated  milk,  rice,  hominy,  grits, 
oatmeal,  rolled  oats,  cornmeal,  beans,  corn  oil,  sirup,  cottonseed  oil, 
canned  peas,  tomatoes,  corn,  beans,  salmon  and  sardines,  dried 
prunes,  apples,  peaches  and  raisins,  and  buckwheat)  at  margins  vary- 
ing from  50  cents  to  75  cents  per  barrel  on  wheat  flour  down  to 
1  cent  to  2  cents  per  pound  on  standard  hams  and  bacon.1  Under 
the  announcement  of  April  6  the  rule  limiting  profits  to  a  prewar 
basis  was  held  to  apply  to  all  licensed  articles,  whether  the  margins 
had  been  fixed  or  not,  while  in  that  of  June  6  the  prewar  rule  was 
only  applied  to  licensed  commodities  upon  which  no  specific  margins 
had  been  established. 

The  task  of  establishing  maximum  retail  margins,  even  apart 
from  the  handicap  in  the  law,  was  greater  far  than  that  establishing 
the  above  wholesale  margins.  There  wyere  vast  differences  in  the  cost 

1  Wholesale  margins  :  The  most  complete  list  of  maximum  margins  on  sales  by  whole- 
salers to  retailers  is  that  of  June  6,  1918,  below.  The  margins  set  forth  on  Apr.  G 
previous  are  extended  in  this  later  list,  and  the  June  6  list  is,  therefore  (except  for  an 
increase  in  the.  maximum  for  flour  set  on  Nov.  4,  60  cents  to  90  cents  per  barrel ; 
the  setting  of  a  maximum  for  buckwheat  flour  on  Nov.  8  at  10  to  12|  per  cent;  and  a 
margin  of  21  cents  per  pound  on  oleomargarine  and  butter  substitutes  announced  on 
Dec.  5),  the  one  which  remained  in  force  from  that  time  on. 

COMMODITIES,    MAXIMUM    MARGINS. 

Sugar,  15  cents  to  35  cents  per  100  pounds. 

Wheat  flour,  50  cents  to  75  cents  per  barrel. 

Lard,  lard  substitutes,  bulk  (packages  of  50  pounds  or  over),  1J  cents  to  2  cents  per 
pound. 

Standard  hams,  bacon,  1  cent  to  2  cents  per  pound. 

All  flours  (except  wheat),  lard  and  lard  substitutes,  in  packages  (less  than  50  pounds), 
condensed,  evaporated  milk,  8  to  10  per  cent. 

Rice,  hominy,  grits,  oatmeal,  rolled  oats,  corn  meal,  beans,  in  bulk  (packages  of  25 
pounds  or  over),  10  to  121  per  cent. 

Rice,  corn  meal,  hominy,  grits,  oatmeal,  self-rising  and  prepared  flour,  and  rolled  oats, 
all  in  packages  ;  corn  oil,  corn  sirup,  sugarhouse  sirup,  mixed  sugar  and  corn  sirup,  and 
cottonseed  oil ;  standard  and  extra  standard  licensed  canned  peas,  tomatoes,  corn,  and 
canned  dried  beans,  and  pink,  chum,  and  red  salmon  and  all  domestic  sardines  ;  all  dried 
prunes,  apples,  peaches,  raisins,  12  to  15  per  cent. 


54 


HISTORY   OF   PRICES   DURING   THE   WAR. 


of  doing  business  throughout  the  country,  and  the  control  of  retail 
prices  was  left  largely  to  the  local  food  administrators  and  to  price- 
interpreting  boards.  The  same  requirement  for  more  definite  stand- 
ards of  what  was  to  be  considered  a  "reasonable"  profit,  however, 
finally  forced  the  making  of  retail  margins.  Margins  were  early 
fixed  for  sugar  and  flour  at  retail  and  later  for  butter,  butter  substi- 
tutes, eggs  and  cheese.  Finally,  on  November  7,  1918,  a  definite  list 
of  maximum  margins  for  sales  by  retailers  to  consumers  was  an- 
nounced.1 Retailers  were  warned  that  these  margins  were  maxima 
only,  and  were  not  to  be  construed  as  absolute  margins.  A  retailer, 
moreover,  who  ordinarily  sold  these  commodities  for  less  than  the 
specified  margin  was  not  under  the  rule  permitted  to  increase  his 
profit  beyond  that  normal  point. 

DISREGARD  OF  REPLACEMENT  VALUE. 

It  was  also  a  declared  policy  worthy  of  note,  that  the  Food  Ad- 
ministrator in  setting  margins  for  commodities  at  retail,  as  well 

1  Retail  margins  :  The  Food  Administration,  on  Nov.  7,  1918,  made  the  following  an- 
nouncement of  maximum  retail  margins  : 

Maximum  margins  on  sales  by  retailers  to  consumers  :  The  Food  Administration  has  de- 
termined that  any  sales  of  food  commodities  at  a  gross  margin  above  delivered  cost  in 
excess  of  those  indicated  below  are  unreasonable,  and  will  be  regarded  as  prima  facie 
evidence  of  a  violation  of  the  statute  and  of  the  above  regulation.  Percentage  may  be 
calculated  on  the  selling  price.  Delivered  cost  shall  mean  the  cost  at  the  railroad,  steam- 
boat, or  other  terminal  in  the  retailer's  town.  Where  the  retailer  is  not  located  in  a 
railroad  or  steamboat  town  he  may  include  any  hauling  charge  in  the  delivered  cost. 

The  lesser  margin  indicated  is  not  a  minimum  margin,  but  is  a  maximum  margin  for, 
those  whose  cost  of  doing  business  is  less,  such  as  stores  which  do  not  perform  the  serv- 
ices of  credit  and  delivery.     Any  change  from  the  prewar  practice  in  cash  discount  terms 
or  other  changes  which  tend  to  or  result  in  increasing  the  margin  of  profit  allowed  will 
be  dealt  with  as  an  unfair  practice. 

The  retailer  may  have  the  benefit  of  fractional  costs  on  each  transaction  ;  that  is,  he 
may  calculate  the  total  charge  to  a  customer  on  any  transaction  as  if  fractional  costs 
were  not  allowed,  and  if  the  result  is  a  fraction,  he  may  add  thereto  such  fraction  of  a 
cent  as  may  be  necessary  to  make  a  price  in  even  cents.  The  following  table  gives  an 
example  in  the  case  of  eggs,  using  the  cash  and  carry  margin  of  7  cents  per  dozen  : 


Amount  of  sale. 

Cost. 

Margin  . 

Total. 

Fraction 
added. 

Maximum 
selling 
price. 

1  dozen  .                

SO.  46} 

Cents. 
7 

$0.  53J 

9 

$0.  54 

2  d  o/en 

.92* 

14 

1.06* 

| 

1.07 

3  dozen  

1.38f 

21 

1.  59| 

| 

1.60 

MAXIMUM     MARGINS. 

Victory  flour,  original  mill  packages,  one-half-barrel  quantities  and  more,  $1  to  $1.20 
per  barrel. 

Victory  flour,  original  mill  packages,  one-fourth-barrel  quantities  and  less,  $1.35  to 
$1.60  per  barrel. 

Victory  flour,  broken  mill  packages,  1J  cents  per  pound. 

Wheat  flour,  original  mill  packages,  one-half-barrel  quantities  and  more,  $1  to  $1.20 
per  barrel. 

Wheat  flour,  original  mill  packages,  one-fourth-barrel  quantities  and  less,  $1.35  to 
$1.60  per  barrel. 


GOVERNMENT   CONTROL  OVER  PRICES.  55 

• 

as  wholesale,  gave  no  regard  to  the  replacement  value  in  determining 
upon  the  maximum.  He  was  not  concerned,  in  other  words,  so  much 
with  market  value  as  with  equitable  -distribution.  The  cost  of  pur- 
chase, not  the  cost  of  replacement,  was  adopted  as  the  sounder  basis 
for  determining  what  was  a  reasonable  profit  to  allow. 

AGREEMENTS  WITH  THE  TRADE. 

The  experience  of  the  Food.  Administrator  in  Europe,  together 
with  his  conferences  here  throughout  the  spring  of  1917  and  his 
own  instinctive  point  of  view,  gave  him  a  determined  faith  in  the 
integrity  and  general  honesty  of  the  trade.  He  maintained,  as  a 
cardinal  policy  from  the  beginning,  a  very  close  and  intimate  con- 
tact with  the  trade.  The  men,  whom  he  chose  to  head  his  various 
commodity  sections  and  responsible  positions,  were  in  a  large 
measure  tradesmen.  They  were,  too,  generally  volunteers.  The  de- 
termination of  policies  of  control  within  each  branch  of  the  food 
industry  was  made  in  conference  with  the  tradesmen  of  that  branch, 

Wheat  flour,  broken  mill  packages,  1J  cents  per  pound. 

Barley  flour,  original  mill  packages,  18  to  22  per  cent. 

Barley  flour,  broken  mill  packages,  1|  cents  per  pound. 

Rye  flour,  original  mill  packages,  18  to  22  per  cent. 

Rye  flour,  broken  mill  packages,  1J  cents  per  pound. 

Corn  flour,  original  mill  packages,  18  to  22  per  cent. 

Corn  flour,  broken  mill  packages,  1|  cents  per  pound. 

Rice  flour,  18  to  22  per  cent. 

Corn  meal,  bulk,  1J   cents  per  pound. 
,  Corn  meal,  original  mill  packages,  18  to  22  per  cent. 

Hominy,   18  to  22  per  cent. 

Sugar,  all  kinds,  in  bulk,  1J  cents  per  pound. 
'    Sugar,  all  kinds,  in  refiners'  original  packages,  1  cent  per  pound. 

Evaporated  milk,  unsweetened,  18  to  22  per  cent. 

Oat  meal  and  rolled  oats,  bulk,  11  cents  per  pound. 

Oat  meal  and  rolled  oats,  original  mill  packages,  20  to  25  per  cent. 

Rice,  20  to  25  per  cent. 

Beans,  white  or  colored,  20  to  25  per  cent. 

Starch,  edible,  20  to  25  per  cent. 

Corn  sirup,  tins,  20  to  25  per  cent. 

Canned  corn,  peas,  and  tomatoes,  standard  grades,  25  to  30  per  cent. 

Canned  salmon— chums,  pink,  and  red,  25  to  30  per  cent. 

Canned  sardines,  domestic,  25  to  30  per  cent. 

Dried  fruit,  raisins,  prunes,  and  peaches,  25  to  30  per  cent. 

Lard,  pure  leaf,  bulk,  5  to  6  cents  per  pound. 

Lard,  pure  leaf,  tins,  18  to  22  per  cent. 

Lard  substitutes,  bulk,  5  to  6  cents  per  pound. 

Lard  substitutes,  tins,  18  to  22  per  cent. 

Breakfast  bacon,  whole  pieces,  6  to  7  cents  per  pound. 

Heavy  bacon,  whole  pieces,  5  to  6  cents  per  pound. 

Hams,  smoked,  whole,  6  to  7  cents  per  pound.  In  quoting  sliced  ham  and  bacon  add 
usual  differential  to  cover  actual  shrinkage. 

By  other  special  regulations  the  retailers'  maximum  margins  have  also  been  fixed  in 
accordance  with  the  following  list : 

Potatoes,  white  or  Irish,  25  to  30  per  cent. 

Onions,  25  to  30  per  cent. 

Eggs  (whether  sold  in  carton  or  not),  7  to  8  cents  per  dozen. 

Butter,  6  to  7  cents  per  pound. 

Butter  substitutes,  oleomargarine,   nutmargarine,   etc..    5   to  6  cents  per  pound. 

Cheese — American,  Cheddars,  twins,  flats,  daisies,  long  horns,  and  Y.  A.'s,  7  to  8  cents 
per  pound, 


56  HISTORY   OF  PRICES   DURING  THE   WAR. 

meeting  at  intervals  in  Washington.  It  might  be  said,  in  one  sense, 
that  the  framework  of  food  control,  as  of  raw  material  control,  was 
built  upon  agreements  with  the  trade.  The  enforcement  of  the 
agreements  once  made,  moreover,  was  intrusted  in  part  to  the  co- 
operation of  constituted  trade  organizations.  The  industry  itself 
was  made  to  feel  responsible  for  the  enforcement  of  all  rules  and 
regulations.  Those  agreements  were  frequently  of  an  informal  char- 
acter and  many  of  them  were  never  .written  upon  paper. 
CAMPAIGNS  OF  EDUCATION  FOR  CONSUMERS. 

The  basis  of  all  efforts  toward  control  exercised  by  the  Food 
Administration  was  the  educational  work  which  preceded  and  ac- 
companied its  measures  of  conservation  and  regulation.  Mr.  Hoover 
was  committed  thoroughly  to  the  idea  that  the  most  effective  method 
to  control  foods  was  to  set  every  man,  woman,  and  child  in  the  country 
at  the  business  of  saving  food.  The  fact,  as:  he  estimated,  that  90 
per  cent  of  the  ultimate  food  consumption  of  the  country  was  in 
the  hands  of  the  women  prompted  him  to  lay  before  them  rather 
full  plans  showing  how  to  eliminate  waste,  reduce  consumption,  and 
introduce  substitutes.  The  country  was  literally  strewn  with  millions 
of  pamphlets  and  leaflets  designed  to  educate  the  people  to  the  food 
situation.  No  war  board  at  Washington  was  advertised  as  widely 
as  the  United  States  Food  Administration.  There  were  Food  Ad- 
ministration insignia  for  the  coat  lapel,  store  window,  the  restaurant, 
the  train,  and  the  home.  A  real  stigma  was  placed  upon  the  person 
who  was  not  loyal  to  Food  Administration  edicts  through  pressure 
by  schools,  churches,  women's  clubs,  public  libraries,  merchants'  as- 
sociations, fraternal  organizations,  and  other  social  groups.  Each 
State  had  an  educational  director  and  a  vast  organization  under  him 
to  propagate  food  policies.  The  historian  of  the  Food  Administra- 
tion makes  a  unique  attempt  to  estimate  at  the  commercial  value  of  the 
advertising  which  wyas  given,  generally  gratis,  to  the  propaganda 
of  the  Food  Administration : 

So  spontaneous  did  the  contributions  of  advertising  become  after  the  first 
few  months  that  it  has  been  impossible  to  keep  any  accurate  account  of  the 
money  value  of  the  advertising  which  has  been  given  to  the  Food  Adminis- 
tration. From  such  records  as  have  been  kept?  however,  a  conservative  esti- 
mate approximates  the  sum  of  $18.000,000.  This  record  includes  outdoor  adver- 
tising by  bulletin  boards  and  the  electrical  displays,  indoor  advertising,  as 
in  railroad  and  street  cars,  space  in  periodicals,  newspapers,  and  other  such 
mediums,  but  is  exclusive  of  moving-picture  contributions,  "  Four  minute  "  and 
other  volunteer  speakers,  and  other  volunteers  who  would  have  ordinarily  been 
paid  for  their  services,  among  whom  were  American  artists  of  national  repu- 
tation. 

The  general  policies  set  up  by  the  Food  Administrator,  under  the 
liberal  powers  given  to  the  food-control  act,  were  designed  toward 
feeding  the  country  and  the  Allies  as  nearly  upon  a  prewar  basis  as 


GOVERNMENT   CONTROL   OVER   PRICES.  57 

each  situation  would  permit.  The  variations  in  general  policy  can 
be  given  a  comprehensive  analysis  only  under  the  particular  commo- 
dity heads.  The  whole  structure  of  food  control  rested  in  principle 
upon  voluntary  cooperation  and  agreement. 

(3)   THE  ADMINISTRATION   OF  FOOD   CONTROL. 

The  real  skeleton  upon  which  must  hang  any  inquiry  into  the 
administration  of  food  control  is  the  license  system  which  was  given 
authority  in  law  by  the  food-control  act  and  around  which  was  set 
up  every  regulation  of  the  Food  Administration.  A  documentary 
record,  arranged  in  order  of  authority,  of  every  rule  of  food  con- 
trol could  be  made  by  an  examination  of  the  food-control  act,  the 
presidential  proclamations  and  Executive  orders,  the  general  license 
regulations  and  the  special  license  regulations.  The  food-control 
act  was  the  authority  granted  by  Congress  to  the  President  to  con- 
trol foods,  the  presidential  proclamations  and  Executive  orders 
issued  under  that  act  created  the  Food  Administration  and  pro- 
claimed what  persons  and  commodities  were  to  be  licensed,  the  gen- 
eral license  regulations  declared  the  rules  and  regulations  set  up  by 
the  Food  Administration  and  made  applicable  to  all  licensees  and 
licensed  commodities,  and  the  special  license  regulations  declared 
the  rules  and  regulations  set  up  by  the  Food  Administration  and 
made  applicable  to  particular  licensees  and  particular  licensed  com- 
modities. The  tangible  evidence,  therefore,  of  all  commodities  that 
came  under  formal  food  control  is  to  be  found  by  following  these 
links  of  the  license  system. 

THE  LICENSE  SYSTEM  AS  THE  BASIS  OF  CONTROL. 

The  Food  Administration  controlled  foods  during  the  war 
through  its  power  to  prescribe  the  conditions  under  which  food 
dealers  might  operate.  A  review  has  already  been  made  telling  how 
the  Food  Administration,  proclamation  by  proclamation,  came  into 
license  control  over  very  nearly  the  whole  lot  of  food  staples  at 
wholesale.1  Its  license  power  lay  in  its  right  to  grant  or  withdraw 

*A  complete  list  of  the  Executive  orders  and  proclamations,  which  extended  Food  Ad- 
ministration license  control  over  the  food  group,  was  given  in  an  earlier  section  of  this 
chapter.  These  presidential  proclamations  drew  increasing  numbers  of  persons  under 
license  control  until,  on  December  31,  1918,  there  were  263,737  firms,  individuals,  and 
corporations  under  license  by  the  Food  Administartion.  There  follows  an  enumeration  of 
those  licenses  by  kind  : 
General  licenses  issued  under  the  President's  proclamation  of  Oct.  8,  1017,  and 

supplemental    proclamations 152, 100 

Sugar  licenses  issued  under  the  proclamation  of  Sept.  7,  1917 473 

Bakers'  licenses 38,  800 

Salt-water  fishermen's  licenses 69,  218 

Steamship    bakers'     licenses 1, 103 

Near-beer  manufacturers'  licenses 377 

Arsenic  licenses i 511 

Coffee   licenses 1,  155 

Total    .  -  263,  737 


58  HISTORY   OF   PRICES   DURING   THE   WAR. 

licenses  at  discretion.  It  required,  in  the  exercise  of  that  power, 
that  each  licensee  accede  both  to  general  and  special  regulations 
as  a  condition  permitting  him  to  do  business. 

The  general  license  regulations,  made  applicable  to  all  licensees, 
were  gradually  worked  over  and  later  condensed  into  a  form  compact 
enough  to  permit  of  ready  analysis.1  Reports  wrere  required  from 
each  licensee  showing  complete  information  regarding  any  commod- 
ities dealt  in  by  him  and  filled  out  upon  forms  prepared  by  the  Food 
Administration;  all  property  and  records  were  to  be  held  open  for 
inspection;  speculation  and  the  making  of  unreasonable  profits  were 
prohibited;  licensees  were  forbidden  to  make  sales  to  speculators  or 
deal  with  persons  violating  the  food-control  act;  secret  rebates  and 
resales  within  the  same  trade  were  prohibited,  and  so  too  were  com- 
bination sales.  The  above  general  rules  pertained  to  all  licensees, 
with  a  provision  that  if  there  arose  an  inconsistency  between  a  gen- 
eral rule  and  a  special  rule,  the  special  rule  should  prevail. 

The  special  license  regulations,  made  applicable  to  particular 
classes  of  licensees,  exceeded,  of  course,  many  times  over  in  com- 
plexity and  volume  the  more  general  requirements.  The  special  re- 
quirements were  in  almost  a  whirl  of  modification  all  the  while  and 
seemed  in  policy  constantly  to  be  contradicting  each  other.  Such  a 
condition  was  by  necessity  the  case,  since  the  declared  policy  of  the 
Food  Administration  was  to  meet  each  day  the  situation  as  it  ap- 
peared that  day.  The  special  license  regulations  were  made  known 
in  all  manner  of  form — by  press  releases,  by  mimeographed  sheets,  by 
pamphlets,  by  printed  loose-leaf  inserts,  and  by  notification  to  the 
Federal  State  food  administrators.  Some  of  them,  for  one  reason  or 
another,  were  never  printed.  The  inevitable  confusion  which  grew 
up  within  the  trade  and  the  Government  as  these  regulations  began  ta 
mass,  gave  necessity  for  the  loose-leaf  record  of  Food  Administration 
rulings.  That  record,  which  was  started  well  along  in  1918,  per- 
mitted of  inserts  daily  as  new  rules  supplanted  or  superseded  old 
ones,  and  contains,  presumably,  all  regulations  made  by  the  Food 
Administration.  It  is  possible  to  assemble  these  rules  into  families 
of  special-rule  pamphlets,  and  that  was  generally  done.  The  whole 
lot  of  special  rules,  including  those  that  were  printed  in  pamphlets 
and  those  that  were  not,  comprises  28  separate  groups.2 

1  The  remarks  that  follow  in  the  text  are  based  upon  the  loose-leaf  rules  issued  by  the 
Food  Administration  pertaining  to  all  licenses  except  salf-water  fishermen. 

2  The  pamphlets  of  special  rules  were  numbered  serially  from  II  to  XXVIII,  as  listed 
below.     A  pamphlet  of  general  rules  was  issued  as  No.  I  in  the  serial. 

II.  Wheat  and  Rye  Elevators,  Dealers,  and  Millers. 

III.  Corn,  Oats,  Barley — Elevators,  Dealers,  and  Millers. 

IV.  Maltsters,  Malt  Dealers,  and  Near  Beer  Manufacturers. 
V.  Rough  Rice  and  Rice  Millers. 

VI.   Sugars,  Sirups,  and  Molasses — Manufacturers  and  Refiners. 
VII.  Canners  and  Packers — Vegetables,  Salmon,  Sardines,  Tuna,  Milk. 
VIII.  Dried  Fruits,  Packers. 


GOVERNMENT   CONTROL   OVER   PRICES.  59 

The  features  and  economic  effects  of  food  control  can  not  be 
gleaned  from  a  stud}T  of  the  special  license  regulations  by  chronolog- 
ical order  of  issuance.  It  is  proposed,  therefore,  to  rearrange  those 
rules  and  discuss  them  as  they  pertained  to  distinct  groups  of  foods. 
An  analysis  of  license  control  within  the  whole  food  group  is  here 
made  under  the  main  divisions,  wheat,  flour,  and  bread;  sugar; 
livestock  and  meats;  poultry  and  dairy  products;  oleomargarine; 
cotton  seed  and  cottonseed  products ;  canned  and  dried  foods :  rice 
and  rice  flour ;  coarse  grains  and  feed  stuffs ;  coffee ;  and  the  collateral 
commodities,  ammonia,  ice,  and  arsenic.  Some  repetition  will  be 
found  in  the  discussion  of  these  various  groups,  but  repetition  is  less 
objectionable  than  vagueness. 

WHEAT,  FLOUR,  AND  BREAD. 

The  wheat  problem  in  the  United  States,  which  reached  its  climax 
in  May,  1917,  was  not  a  local  affair.  It  had  its  beginning  in  the 
Eastern  Continent  in  1914,  and  by  the  time  it  enveloped  America  it 
was  a  world  problem  of  huge  proportions. 

The  demands  of  Europe. — After  nearly  three  years  of  war,  western 
Europe  was  on  short  rations.  Even  in  normal  times  the  European 
countries  do  not  produce  enough  wheat  for  food.  They  import  large 
quantities  from  India,  Australia,  Argentina,  Siberia,  Russia,  the 
Balkans,  Canada,  and  the  United  States.  The  average  annual  impor- 
tation for  the  three  years  preceding  the  war  was  approximately 
550,000,000  bushels,  of  which  about  100,000,000  bushels,  including 
flour,  were  furnished  by  the  United  States. 

Ordinarily  the  United  States  produces  in  the  neighborhood  of 
800,000,000  bushels  of  Avheat  a  year,  and  the  domestic  consumption  is 

IX.  Cotton  Seed,  Peanuts,  Soya  Beans,  Copra,  Palm  Kernels,  and  Their  Products. 

X.  Manufacturers  of  Lard  Substitutes  and  Oleomargarine. 

XI.  Wholesalers,    Jobbers,    Importers,    and    Retailers    of    Nonperishable    Food    Com- 
modities. 
XII.   Brokers  and  Auctioneers  of  Nonperishable  Food  Commodities. 

XIII.  Bakers. 

XIV.  Manufacturers  of  Miscellaneous  Food  Commodities. 

(a)  Products  containing  wheat  or  wheat  flour,  other  than  bakery  products. 

(b)  Manufacturers  and  mixers  of  mixed  flour. 

(c)  Sirup  mixers. 

XV.  Fresh  Fruits  and  Vegetables. 
XVI.   Fresh   and  Frozen  Fish  Distributors. 
XVII.  Salt  Water  Fishermen. 
XVIII.   Poultry. 
XIX.  Eggs. 
XX.   Butter. 
XXI.   Cheese. 
XXII.   Raw  Milk. 

XXIII.  Meat  Packers  and  Manufacturers  of  Lard — Distributors  of  Fresh  Meats. 

XXIV.  Cold  Storage  Warehousemen. 
XXV.  Feedingstuffs. 

XXVI.  Tin  and  Other  Containers. 
XXVII.   All  Public  Eating  Places. 
XXVIII.  General  Storage  Warehousemen. 


60  HISTORY    OF   PRICES    DURING   THE    WAR. 

ii bout  646,000,000  bushels.  The  1917  harvest,  at  the  time  America 
entered  the  war,  was  estimated  at  635,000.000  bushels,  thus  leaving  a 
deficit  of  11,000,000  bushels. 

The  Allies  of  Europe  could  not  be  satisfied,  however,  Avith  anything 
but  an  extraordinary  importation  in  1917.  For  three  years  they  had 
been  engaged  in  the  most  destructive  war  in  the  world's  history.  Not 
only  had  their  food  requirements  been  increased  but  their  production 
facilities  had  been  diminished.  At  the  same  time,  moreover,  .unre- 
stricted submarine  warfare  had  so  reduced  the  Allied  merchant  fleets 
and  so  endangered  world  commerce  that  it  was  impracticable  for  any 
European  nation  to  try  to  haul  wheat  over  the  long  route  from  India 
or  Australia  or  South  America,  especially  when  it  was  possible  to  buy 
in  the  United  States.  Siberian  wheat  was  even  less  accessible  than 
that  of  Australia,  since  the  Russian  port  of  Odessa  had  been  shut  off 
from  western  Europe  by  the  closing  of  the  Dardanelles.  Thus  in  the 
spring  of  1917  the  United  States  was  made  the  Mecca  of  Allied  wheat 
buyers.  The  president  of  the  Chicago  Board  of  Trade  stated  that 
the  largest  buyers,  both  for  cash  and  for  future  delivery,  were  the 
Governments  of  Europe.  On  the  one  hand,  the  vigor  of  buying  by 
foreign  agents  had  struck  American  markets  like  a  tidal  wave;  on 
the  other  hand,  the  United  States  wheat  crop,  soon  to  be  harvested, 
was  shorter  than  it  had  been  since  1913,  and  the  supply  would  have 
been  inadequate  even  during  a  normal  year. 

Another  feature  of  the  situation,  and  one  which  no  doubt  had  more 
influence  than  any  other,  was  that  America  had  entered  the  World 
War.  The  psychological  effect  of  war  upon  consumers  who  are 
capable  of  anticipating  the  performance  of  markets  is  well  under- 
stood. A  wild  rush  of  buying  seized  America  as  well  as  the  Allied 
Governments.  From  March  to  May,  1917,  the  price  increased  $1  a 
bushel  for  No.  2  red  winter  wheat  at  Chicago,  reaching  an  average 
for  May  of  $2.97.  No.  1  Northern  spring  wheat  averaged  $2.98  x  at 
Minneapolis  for  the  month  of  May.  This  was  the  highest  price  in  the 
history  of  America,  being  50  per  cent  higher  than  the  maximum 
during  the  Civil  War. 

The  necessity  for  an  increased  world  production. — The  scarcity  of 
available  wheat  had  precipitated  a  panic.  While  fear  was  an  element 
in  the  situation,  the  problem  of  scant  supply  was  real.  Increased 
world  production  was  the  effective  remedy,  and  under  existing  condi- 
tions America  was  the  country  which  must  do  most  in  increasing  the 
world  supply.  Wildly  fluctuating  prices  are  not  attractive  to  the 
American  farmer,  however,  especially  if  they  reach  unusual  heights 
at  a  season  of  the  year  when  his  crop  is  not  ready  for  the  market. 
A  high  price  in  May  does  not  insure  a  high  price  at  harvest  time, 

1  Monthly  average  from  weekly  quotations  in  the  Price  Current  Grain  Reporter. 


GOVERNMENT    CONTROL    OVER   PRICES.  61 

later  on.  Moreover,  the  problem  of  world  supply  <£f  wheat,  which 
became  acute  in  the  spring  and  summer  of  1917,  could  not  be  alle- 
viated except  by  sowring  more  wheat  to  be  harvested  one  year  later,  or 
in  the  summer  of  1918.  Making  wheat  culture  attractive  to  the 
farmer,  therefore,  became  the  task  of  the  Government  officials. 

A  minimum  price  for  wheat  -fixed  l>y  statute. — Congress  completed 
the  food  control  act  (Lever  Act)  4  months  after  the  United  States  had 
declared  war  against  Germany,  and  it  was  approved  by  the  President 
on  August  10,  1917.  This  law  not  only  made  possible  the  organiza- 
tion and  program  of  the  Food  Administration,  but  section  14  named 
a  minimum  price  of  $2  per  bushel  for  the  1918  wheat  harvest  under 
the  act.  Differentials  were  to  be  set  up  for  the  several  standard 
grades  of  wheat,  based  upon  No.  1  Northern  spring  wheat  at  Chicago, 
or  its  equivalent  at  the  principal  interior  primary  markets.  The 
President  was  authorized,  whenever  he  should  find  an  emergency  to 
exist  requiring  stimulation  of  the  production  of  wheat,  and  whenever 
it  seemed  essential  that  the  producers  should  have  the  benefit  of  the 
guaranty,  to  determine  and  fix  what,  under  specified  conditions,  he 
considered  a  reasonable  guaranteed  price  for  wheat,  in  order  to  assure 
producers  a  reasonable  profit. 

It  is  quite  evident  that  the  authors  of  section  14  were  concerned 
entirely  with  the  producer.  Production  of  wheat  was  the  world's 
prime  need,  and  the  purpose  of  this  guaranty  was  to  serve  notice 
upon  the  fanner  one  year  in  advance  of  his  harvest  that  he  might 
expect  at  least  $2  a  bushel  for  his  wheat  crop,  and  as  much  more  as 
the  market  should  justify  and  the  President  provide. 

It  is  of  interest  again  to  note  that  Congress  did  not  name  a  price 
for  any  commodity  other  than  wheat.  It  gave  the  President  au- 
thority (sec.  25)  to  fix  the  price  of  coal,  and  (sec.  11)  to  pur- 
chase, to  store,  to  provide  storage  facilities  for,  and  to  sell  for 
cash  at  reasonable  prices,  wheat,  flour,  meal,  beans,  and  potatoes,  but, 
with  the  exception  of  wheat,  no  legislative  price  was  fixed.  Analysis 
of  the  food-control  act  leads  to  the  conclusion  that  section  14  is  not 
"  part  and  parcel "  of  the  original  plan.  Other  sections,  phrased  in 
general  terms,  appear  to  anticipate  problems  or  to  confer  blanket 
powers  upon  the  President.  In  section  14,  however,  a  specific  prob- 
lem is  singled  out  and  dealt  with  in  a  manner  to  insure  interest  in 
the  production  of  wheat. 

Two  other  sections  of  the  act  confer  powers  which  were  widely 
used  in  connection  with  the  wheat  price :  Section  2,  authorizing  the 
President  to  enter  into  voluntary  agreements  for  carrying  out  the 
purposes  of  the  act,  and  section  5,  providing,  in  effect : 

That  whenever  the  President  shall  find  it  essential  to  license  the  importa- 
tion, manufacture,  storage,  or  distribution  of  necessaries  in  order  to  prevent 
unjust  storage  charge,  commissions,  profits,  or  practices  he  shall  have  such 


62  HISTORY  ^OF   PRICES   DURING  THE   WAR. 

authority.  Furthermore  he  shall  be  empowered" to  determine  what  are  fair 
profits,  commissions,  storage  charges,  etc.,  and  may  require  licensees  to  gov- 
ern their  businesses  according  to  his  findings.  A  fine  of  $5,000,  or  impris- 
onment for  two  ye.-irs,  or  both,  shall  await  the  person  who  deals  without  a 
license  or  the  licensee  who  violates  the  rules.  Licenses  may  be  revoked. 
Farmers,  gardeners,  associations  of  farmers  and  gardeners,  and  retailers  whose 
gross  sales  do  not  equal  $100,000  per  year,  shall  not  be  required  to  take  out 
licenses. 

Acting  under  the  authority  conferred  by  the  food  control  act, 
the  President  and  the  Food  Administration  fixed  maximum  prices 
for  a  large  number  of  foods,  but  wheat  stands  alone,  among  all  the 
records  of  Government  price  control,  as  a  minimum  price  fixed  by 
legislative  enactment. 

The  relation  of  the  minimum  price  to  the  market  price. — When 
the  food  control  act  became  a  law  wheat  was  selling  in  Chicago  for 
$2.26  a  bushel  (average  for  month).  The  1917  crop  was  moving  to 
the  markets.  Congress  had  established  a  minimum  price  of  $2,  but  this 
would  not  be  effective  until  11  months  had  passed.  This  price,  more- 
over, being  below  the  prevailing  market  price,  would  not  appeal  es- 
pecially to  the  wheat  grower  unless  he  should  be  informed  what  mar- 
gin he  might  expect  over  and  above  the  guaranteed  minimum.  Such 
information  was  to  be  forthcoming  presently  through  the  action  of 
the  President  in  establishing  a  definite  price  at  a  point  above  the 
minimum,  but  the  immediate  need  was  a  stabilization  of  prices  and 
conservation  of  supply  during  the  11  months  to  intervene  before 
the  legislative  price  should  begin  to  operate. 

What  limit  should  be  set  upon  wheat  purchases  for  export  ?  Con- 
sidering the  demoralized  transportation  facilities  both  on  land  and  on 
sea,  what  was  to  prevent  huge  supplies  of  wheat  from  accumulating 
in  the  seaboard  and  interior  terminals,  later  glutting  the  market 
and  forcing  the  producers'  price  down?  If  satisfaction  was  not 
rendered  to  the  wheat  grower  in  1917,  when  the  problem  was  pres- 
ent^ and  real,  and  unprecedented,  what  was  the  use  to  promise  him 
a  fair  price  one  year  hence,  when  perhaps  there  might  be  no  panicky 
situation  ? 

Such  considerations  as  these  led  the  administration  to  fix  a 
fair  price  for  the  1917  wheat  crop.  Progress  in  this  direction  had 
been  made  even  before  the  food  control  act  became  a  law.  On 
May  11,  1917,  the  Chicago  Board  of  Trade  had  prohibited  trading 
in  May  wheat  futures,  and  had  compelled  the  settlement  of  all  out- 
standing contracts  at  $3.18  a  bushel.  This  first  step  in  fixing  an 
arbitrary  price  had  stopped  the  wheat  -  rise.  About  the  same  time 
representatives  of  the  council  of  grain  exchanges  conferred  with 
the  Secretary  of  Agriculture  concerning  Government  control  of  the 
wheat  trade,  and  the  committee  of  grain  exchanges  in  aid  of  national 
defense,  organized  at  that  time,  together  with  a  committee  from  the 


GOVERNMENT   CONTROL   OVER   PRICES.  63 

western  exchanges,  met  with  Mr.  Hoover  on  May  J.6  and  "at  his 
request  submitted  a  tentative  outline  of  a  plan  of  control."  Under 
this  plan  the  Government  would  control  transportation  of  foodstuffs, 
fix  a  price  for  wheat  and  maintain  it  for  the  entire  crop  year  without 
change,  control  the  distribution  of  the  available  wheat  supply,  and 
control  the  storage  facilities  of  elevators. 

On  August  14,  only  four  days  after  Mr.  Hoover  was  named  Food 
Administrator,  the  President  announced  the  appointment  of  a  com- 
mittee to  determine  a  fair  price  at  which  wheat  should  be  purchased 
by  the  Government. 

The  committee  reported  to  the  President  on  August  30,  recommend- 
ing that  the  price  of  No.  1  Northern  spring  wheat,  or  its  equivalent 
at  Chicago,  be  $2.20  a  bushel.  Differentials  were  established  for 
other  grades  and  terminals.  One  paragraph  of  the  report  follows: 

In  reaching  its  conclusions,  the  committee  lias  beeii  guided  by  the  principles 
you  have  announced,  that  a  fair  price  should  be  based  upon  the  cost  of  pro- 
duction for  the  entire  country,  plus  a  reasonable  profit.  We  have  relied  upon 
the  cost  estimates  for  the  crop  of  1917  furnished  by  the  United  States  Depart- 
ment of  Agriculture,  checked  by  the  results  of  our  independent  investigations 
'and  the  evidence  submitted  to  the  committee  by  producers  and  other  repre- 
sentatives. 

Upon  receiving  the  report  of  the  "  fair  price  "  committee,  Presi- 
dent Wilson  announced  this  price  immediately  to  the  country.  He 
said  it  would  be  rigidly  adhered  to  by  the  Food  Administration,  and 
continued : 

It  is  the  hope  and  expectation  of  the  Food  Administration,  and  my  own  also, 
that  this  step  will  at  once  stabilize  and  keep  within  moderate  bounds  the  price 
of  wheat  for  all  transactions  throughout  the  present  crop  year,  and  in  con- 
sequence the  prices  of  flour  and  bread  also.  The  food  act  has  given  large  powers 
for  the  control  of  storage  and  exchange  operations,  and  these  powers  will  be 
fully  exercised.  An  inevitable  consequence  will  be  that  financial  dealings  can 
not  follow  their  usual  course.  Whatever  the  advantages  and  disadvantages 
of  the  ordinary  machinery  of  trade,  it  can  not  function  well  under  such  dis- 
turbed and  abnormal  conditions  as  now  exist.  In  its  place  the  Food  Adminis- 
tration now  fixed  for  its  purchases  a  fair  price,  as  recommended  unanimously 
by  a  committee  representative  of  all  interests  and  all  sections  and  believes 
that  thereby  it  will  eliminate  speculation,  make  possible  the  conduct  of  every 
operation  in  the  full  light  of  day,  maintain  the  publicly  stated  price  for  all, 
and  through  economies  made  possible  by  stabilization  and  control,  better  the 
position  of  consumers  also. 

Mr.  Hoover,  at  his  express  wish,  has  taken  no  part  in  the  deliberations  of 
the  committee  on  whose  recommendation  I  determine  the  Government's  fair 
price,  nor  has  he  in  any  way  intimated  an  opinion  regarding  that  price. 

The  Food  Administration  had  made  public  its  aims  before  the 
appointment  of  the  fair-price  committee:  (1)  To  regulate  trade  so  as 
to  eliminate  vicious  speculation  and  to  stabilize  prices;  (2)  to  guard 
exports;  (3)  to  induce  saving.  A  second  statement  soon  followed  to 
the  effect  that  the  Food  Administration  proposed  to  open  agencies 


64  HISTORY   OF   PRICES   DURING   THE   WAR. 

for  the  purchase  of  wheat  at  all  the  principal  terminals,  carrying  on 
its  transactions  through  the  regular  dealers,  and  that  it  was  prepared 
to  take  the  whole  harvest,  if  necessary,  in  order  to  maintain  a  fair 
price.  Upon  the  announcement  of  the  price  of  $2.20,  the  Food 
Administration  affirmed  its  intention  "to  use  every  authority  given 
it  under  the  food-control  act  and  the  control  of  exports  to  effect  the 
universality  of  this  fair  basis  throughout  the  whole  of  the  1917  har- 
vest year  without  change  or  fluctuation." 

The  announced  policy  of  the  Food  Administration  makes  evident 
the  difference  in  point  of  view  of  the  legislative  and  executive 
branches  of  .the  Government.  Congress  provided  a  minimum  price 
for  the  1918  wheat  crop ;  the  Food  Administration  adopted  a  definite 
"  fair  price"  for  the  1917  crop.  The  one  was  not  to  be  effective  for 
nearly,  a  year,  or  until  July  1,  1918 ;  the  other  was  effective  from  its 
announcement.  The  former  was  framed  as  an  inducement  to  the 
producer;  the  latter  was  proposed  to  protect  both  the  consumer  and 
the  producer.1 

On  February  21,  1918,  the  President,  by  a  proclamation,  made  the 
1917  wheat  prices  applicable  to  the  1918  harvest,  thus  using  his  pre- 
rogative to  raise  the  minimum  price  to  any  desired  point  above  the  $2 
minimum  set  by  the  Congress.  By  executive  order  of  June  21,  1918, 
the  price  of  wheat  was  raised  to  $2.26  a  bushel,  the  increase  of  6  cents 
being  granted  to  offset  an  increase  in  freight  rates. 

In  passing,  mention  should  be  made  of  the  Government  operation 
of  railroads.  Freight  charges  are  invariably  included  as  cost  items 
in  calculating  a  Government  *'  fair  price "  basis,  and  this  would 
have  been  a  more  complicated  question  if  railroads  had  been  compet- 
ing with  each  other. 

The  enforcement  of  the  wheat  price. — In  the  beginning,  an  indirect 
means  had  to  be  found  to  enforce  the  wheat  price.  Section  14  of  the 
food-control  act  did  not  grant  authority  to  fix  a  guaranteed  price 
above  the  $2  minimum,  except  for  the  purpose  of  increasing  pro- 
duction, consequently  this  did  not  apply  to  the  1917  crop.  Under  sec- 
tion 2,  however,  the  President  could  enter  into  voluntary  agreements ; 
under  section  5  he  could  license  and  prescribe  regulations  for  persons 
engaged  in  the  importation,  manufacture,  storage,  mining,  or  distri- 

1  The  chairman  of  the  milling  division  of  the  Food  Administration  says  that  the  "  fair  " 
wheat  price  was  neither  a  fixed  price  nor  a  maximum  price  ;  that  Congress  did  not  give 
authority  for  definite  fixing  of  a  wheat  price,  and  that  certain  millers  paid  more  for 
wheat  than  the  price  named  by  the  fair-price  committee.  The  principal  millers  of  the 
country,  however,  entered  into  agreements  with  the  Food  Administration  to  the  effect 
that  they  would  not  overbid  the  Government  "  fair  price."  The  millers  kept  their  agree- 
ments, the  Food  Administration  Grain  Corporation  itself  bought  wheat  at  the  "  fair 
price,"  and  the  nonagreement  millers  who  made  payments  in  excess  of  the  "  fair  price  " 
were  not  strong  enough  to  be  serious  menaces  to  the  plan  of  Government  price  control. 
The  "  fair  price "  became  in  effect  a  maximum  price  as  well  as  a  stable  price.  This 
statement  is  borne  out  by  the  table  of  wheat  prices  on  another  page  of  this  bulletin,  as 
well  as  by  the  price  tables  in  the  separate  bulletin  on  "  Wheat  and  wheat  products." 


GOVERNMENT   CONTROL  OVER  PRICES.  65 

bution  of  any  necessaries;  under  section  10  he  coujd  requisition 
supplies  needed  for  any  public  use;  and  under  section  11  he  could 
buy  and  sell  wheat,  flour,  meal,  beans,  and  potatoes. 

Voluntary  agreements  had  been  made  with  the  wheat  and  flour 
trades  during  the  days  of  informal  control,  before  the  passage  of  the 
food-control  act,  and  the  continuation  of  this  method,  by  virtue  of 
section  2,  seemed  practical.  Although  the  Food  Administrator  pos- 
sessed an  alternative  in  his  announced  intention  to  purchase  the  entire 
crop  if  necessary  to  maintain  the  "  fair  price,"  this  course  would  have 
required  an  enormous  amount  of  capital,  and  the  administration 
preferred  to  interfere  as  little  as  necessary  with  the  ordinary  market 
activities.  Unlimited  exercise  of  the  license  power  was  a  second 
alternative,  and  as  time  progressed  this  method  was  resorted  to,  but 
in  the  beginning  the  Food  Administration  did  not  realize  how  much 
authority  it  really  possessed. 

Little  difficulty  was  encountered  in  effecting  the  voluntary  agree- 
ments The  grain  dealers,  like  thousands  of  other  business  men  of 
the  country,  were  willing  to  make  any  sacrifice  necessary  to  win 
the  war.  The  cooperative  spirit  of  this  group  is  shown  by  the  fol- 
lowing resolution  adopted  at  a  conference  of  over  100  representatives 
of  the  grain  and  elevator  trades  of  the  country  held  at  the  offices 
of  the  Food  Administration  August  15,  1917 : 

Realizing  that  the  operation  of  Government  control  in  wheats  and  rye  is 
essential  under  present  war  influences  in  order  to  adequately  protect  our  home 
supply  and  furnish  our  Allies  with  the  aid  we  owe,  and  realizing  that  the  estab- 
lishment of  an  efficient  Government  plan  of  operation  means  to  all  of  us  curtail- 
ment of  our  business  and  to  some  of  us  actual  retirement  from  active  business 
during  such  period,  we  do  express  our  pride  in  the  character  of  service 
tendered  by  the  grain  trade  in  the  sacrifice  by  these  men  of  ability  who  are 
placing  their  experience  and  energy  at  the  service  of  their  Government,  and 
that  we  approve  the  general  plan  of  operation  as  explained  to  us  to-day  as 
being  sound,  workable,  and  necessary,  and  in  its  general  lines  it  appears  to  us 
as  being  the  most  effective  and  just  plan  of  operation  which  we  can  conceive. 

The  flour  milling  interests  of  the  country  also  pledged  themselves 
to  take  any  steps,  in  regard  to  their  industry,  which  might  be  found 
necessary  for  the  winning  of  the  war. 

The  Food  Administration  announced,  therefore,  that  it  expected 
to  accomplish  its  objectives  by  voluntary  cooperation.  It  had  or- 
ganized a  Grain  Corporation,  headed  by  practical  grain  men,  and 
through  this  corporation  the  buying  was  to  be  directed.  Voluntary 
agreements  were  entered  into  between  the  flour  mills  on  the  one 
hand  and  the  Food  Administration  and  Grain  Corporation  on  the 
other,  to  the  effect  that  the  mills  should  not  pay  more  for  wheat 
than  the  so-called  "fair  price."  The  Grain  Corporation  agreed  to 
endeavor  to  supply  millers  with  wheat  on  the  basis  of  their  average 
capacity,  so  far  as  the  limitations  of  the  1917  harvest  would  permit. 
125547°— 20 5 


66  HISTORY  OF  PRICES  DURING  THE   WAR. 

Over  3,000  millers  cooperated  in  the  voluntary  agreements.  Up  to 
November  27,  1917,  the  signed  agreements  received  at  the  Food 
Administration  offices  represented  five-sixths  of  the  milling  capacity 
of  the  country. 

There  were  several  inducements  to  the  millers  to  enter  into  the 
agreements:  (1)  patriotic  motives  prompted  them  to  assist  the  Gov- 
ernment; (2)  the  milling  division  of  the  Food  Administration  was 
administered  by  millers,  all  of  whom  were  serving  without  salaries; 
(3)  the  Grain  Corporation,  through  the  license  powers  explained 
below,  controlled  the  wheat  supplies  of  the  country;  (4)  the  Grain 
Corporation  guaranteed  the  miller  against  loss  by  decline  in  value 
of  the  unsold  wheat  and  flour;  (5)  the  relative  position  of  mills 
in  the  industry  would  be  maintained;  (6)  the  permissible  profit  of 
25  cents  a  barrel  for  the  manufacture  of  flour  was  attractive  if  it 
meant  25  cents  net. 

While  it  is  true  that  some  mills  did  not  accede  to  the  agreement, 
they  were  decidedly  in  the  minority.  Their  operations,  unless  they 
were  very  small  mills,  were  reasonably  well  controlled,  moreover, 
by  the  license  requirements  which  the  Government  promulgated  even 
before  it  asked  the  millers  formally  to  enter  voluntary  agreement.1 

Licensing  millers  and  elevators. — President  Wilson  issued  a  proc- 
lamation on  August  14,  1917,  requiring  storers  and  distributors  of 
wheat  and  rye  as  well  as  persons  manufacturing  products  of  wheat 
or  rye  to  procure  licenses  before  September  1.  Mills  with  a  daily 
capacity  of  less  than  100  barrels  were  exempted  from  this  order. 
Effective  November  1,  another  proclamation  extended  the  license 
provision  to  all  mills  having  a  daily  capacity  of  75  barrels  or  over, 
and  before  February  15,  1918,  every  mill  in  the  country  was  re- 
quired to  be  licensed.  Practically  every  rule  which  had  been  applied 
to  the  voluntary  agreement  mills  was  applied  to  the  license  mills 
with  the  exception  that  the  latter  were  not  forbidden  to  pay  more 
than  the  "fair  price"  for  wheat.  This  matter  was  taken  care  of  in 
another  way,  nevertheless,  for  in  regard  to  the  limitation  of  the 
miller's  profit  to  25  cents  per  barrel  on  flour  and  50  cents  per  ton 
on  feed,  it  was  specified  that  in  calculating  his  cost  items  no  miller 
should  include  more  for  the  cost  of  wheat  than  the  customary  mar- 
ket price. 

Under  the  license  clause  reasonable  profits  could  be  defined  and 
unreasonable  profits  prohibited,  and  the  license  of  any  person  could 
be  revoked  as  a  penalty  for  engaging  in  an  unfair  practice.  This 
placed  almost  absolute  power  over  certain  industries  in  the  hands  of 
the  Government,  and  after  July,  1918,  the  Food  Administration 
came  to  rely  wholly  upon  this  section  of  the  law  for  its  authority. 

1 A  form  letter  explaining  the  voluntary  agreement  plan  and  asking  for  cooperation 
was  sent  out  on  Aug.  29,  1917,  to  such  millers  as  had  not  already  been  reached  through 
the  millers'  committee. 


GOVERNMENT   CONTROL   OVER   PRICES.  67 

With  the  passing  of  the  voluntary  agreements,  there  was  no  defi- 
nite price  specified  at  which  the  elevators  and  mills  should  purchase 
wheat.  In  the  absence  of  any  prohibition  to  the  contrary,  it  would 
seem  that  purchasers  might  have  paid  any  price  they  desired.  But 
the  Food  Administration  had  indirect  means,  as  well  as  definite  in- 
tentions, of  maintaining  the  "fair  price."  It  only  stated  that  it 
would  undertake  to  guard  this  price  by  buying  wheat  in  the  princi- 
pal primary  markets.  Of  course,  the  Government  held  a  dominant 
position  as  the  chief  buyer  in  the  market,  and  in  case  of  necessity 
it  could  have  taken  the  entire  crop.  Its  indirect  method,  however, 
was  simpler.  This  is  explained  fully  under  Flour  Control,  but  the 
plan,  in  brief,  was  to  fix  a  maximum  price  for  flour  at  each  mill, 
based  upon  the  Government  "fair  price"  for  wheat.  Thus  if  a  miller 
paid  more  than  the  ufair  price"  for  wheat,  he  would  sacrifice  his 
profit  on  flour,  and  if  he  tried  to  buy  for  less  the  Government  would 
bid  against  him. 

The  1919  guaranteed  price. — President  Wilson,  by  proclamation  on 
September  22,  1918,  extended  the  guaranteed  price  of  $2.26  for  No.  1 
Northern  spring  wheat  at  Chicago  to  the  1919  crop,  if  offered  for 
sale  before  June  1,  1920.  The  termination  of  the  war,  even  if  offi- 
cially announced  by  the  President,  was  not  to  terminate  any  obliga- 
tion accruing  or  accrued  under  this  proclamation.  This  position 
was  taken  by  the  Food  Administration,  and  was  ratified  by  Congress 
and  the  President  in  providing  and  approving  an  appropriation  of 
$1,000,000,000  to  make  good  the  guaranty.  This  means  that  if  the 
price  of  wheat  goes  down  before  June  1,  1920,  the  Government  must 
pay  to  the  wheat  grower,  out  of  the  billion-dollar  fund  the  differ- 
ence between  the  market  price  and  the  guaranteed  price. 

Produoers  generally  satisfied. — As  harvest  approached  and  the 
farmer  observed  a  declining  market  on  the  strength  of  anticipated 
price  regulation  by  the  Government,  he  became  fearful  lest  his  in- 
terest would  be  overlooked.  Why  could  wheat  not  sell  as  well  for 
$3  in  September  as  in  May  ?  "  Many  farmers  were  discontented 
because  they  could  not  sell  their  entire  crop  at  the  high  prices  made 
by  the  uncontrolled  influences  which  had  dominated  when  the  pre- 
vious year's  crop  had  been  exhausted  and  the  market  was  without 
any  balance  wheel.  The  crop  was  slow  to  move."  1  Farmers  of  Min- 
nesota and  the  Dakotas  at  a  conference  August  26,  1917,  advocated  a 
Government  fixed  minimum  price  of  $3  a  bushel.  Agitation  did  not 
continue  long,  however,  after  the  "  fair  price  "  was  announced.  The 
decline  of  flour  prices  to  a  level  commensurate  with  wheat  prices 
helped  to  put  the  farmer  in  a  pacific  mood.  He  also  argued  that 
since  the  wheat  price  was  to  remain  stable  for  a  year  he  could  rush 

irThe  Wheat  and  Flour  Trade  under  Food  Administration  Control,  by  Wilfred  Eldred. 
Quarterly  Journal  of  Economics,  November,  1918. 


68  HISTORY   OF   PRICES   DURING   THE   WAR. 

his  oats  to  market  and  take  care  of  his  corn  crop  before  selling  his 
wheat.  Then  he  found  that  even  at  $2.20  he  could  realize  more  profit 
on  wheat  than  had  ever  been  the  case  before.  His  final  estimate  of 
the  Government  price,  therefore,  was  conciliatory.  Final  determina- 
tion of  the  farmer's  attitude  may  be  drawn  from  his  acts  in  sowing 
more  wheat.  The  acreage  sown  in  the  fall  of  1916  was  40.534.000; 
in  1917  it  was  42,301,000;  and  the  preliminary  estimate  for  1918  was 
4ff.-261.000.1 

stability  of  the  wheat  price  a  reality. — Reference  to  the  wheat 
quotations  in  any  terminal  market  will  show  an  almost  amazing 
stability  of  prices  from  August  30,  1917,  when  the  "  fair  price  "  was 
announced,  until  after  the  armistice  was  signed  in  November,  1918. 
Xo.  2  Eed  Winter  wheat  in  Chicago,  for  instance,  varies  only  three- 
fourths  of  a  cent  from  September.  1917,  to  the  end  of  June,  1918.2 
It  was  June  21,  1918,  that  the  President  advanced  the  price  G  cents  a 
bushel,  and  the  July  to  November  market  price  is  seen  to  be  from  6£ 
cents  to  7T%  cents  above  the  June  price.  The  Food  Administration, 
therefore,  did  for  wheat  what  it  started  out  to  do,  and.  accomplished 
that  result  without  resorting  to  the  alternative  of  buying  the  entire 
crop. 

Such  effective  control  over  wheat  made  possible  a  large  measure 
of  control  over  flour,  even  though  no  express  authority  was  given  by 
.-tatute  to  fix  flour  prices.  How  this  was  accomplished  will  now  be 
explained. 

Close  relation  of  -flour  and  wh-eat. — The  demand  for  wheat  is 
almost  entirely  for  flour  manufacture.  It  is  a  custom  with  the  flour 
market  to  fluctuate  from  day  to  day  in  conformity  with  wheat  fluc- 
tuations. *  Even  though  a  miller  may  have  purchased  his  entire 
year's  supply  of  wheat  in  September,  the  fluctuations  of  wheat 
during  the  following  months  will  affect  the  price  of  this  miller's 
flour.  Flour  prices  are  ordinarily  based  on  the  replacement  value 
of  wheat.  This  makes  clear  the  flour  problem  in  connection  with 
the  wheat  problem  in  the  spring  of  1917.  European  demand  for 
wheat  was  likewise  a  demand  for  flour.  The  short  wheat  crop  was 
disastrous  in  that  it  meant  a  scarcity  of  flour,  and  the  wild  fluctua- 
tions in  wheat  prices  were  practically  duplicated  in  flour  quotations. 
When  wheat  was  at  its  highest  point  in  May  of  that  year,  having 
advanced  $1  a  bushel  in  two  months,  flour  was  at  the  maximum  of 
$14.88  a  barrel  (monthly  average),  having  risen  from  $9.63  a  barrel 
in  March. 

The  flour  shortage  in  the  spring  and  summer  of  1917  was  partly 
due  to  fear  on  the  part  of  the  millers.  They  did  not  dare  to  stock  up 
with  wheat  at  the  high  prices  then  prevailing  because  if  the  Gov- 

1  Bureau  of  Crop  Estimates,  Department  of  Agriculture. 

2  See  Wheat  and  Wheat  Products,  by  Paul  E.  Peltason  (W.  I.  B.  Price  Bulletin  No.  9). 


GOVERNMENT   CONTROL   OVER   PRICES.  69 

eminent  should  fix  the  price  at  a  lower  level  they  would  lose  heavily 
on  their  sales.  It  was  aggravated,  also,  by  the  heavy  buying  of 
consumers  early  in  the  spring  when  prices  were  high  and  showing 
prospects  of  going  higher. 

Control  exercised  over  -flour. — The  flour  and  wheat  problems  were 
attacked  simultaneously  by  the  Food  Administration,  but  by  differ- 
ent methods.  Congress  had  not  named  a  price  for  flour,  nor  had  it 
given  specific  power  to  the  President  to  do  so.  From  the  beginning 
the  Food  Administration  took  the  ground  that  it  had  no  authority 
to  fix  basic  flour  prices.  With  the  price  of  wheat  under  control, 
however,  and  with  authority  to  enter  into  voluntary  agreements ;  to 
compel  millers,  distributors,  and  dealers  to  procure  licenses,  the 
conditions  of  which  were  drafted  by  the  issuing  party  to  -the  con- 
tract; to  control  business  profits  even  to  the  extent  of  specifying 
what  were  reasonable  profits;  and  to  buy  and  sell  flour  for  cash  at 
reasonable  prices,  there  could  have  been  little  question  as  to  the  con- 
trol of  the  flour  industry  by  the  Food  Administration. 

At  first  the  Food  Administration  adopted  the  voluntary  agree- 
ment plan,  but  in  connection  with  this  it  used  its  license  power  and 
its  authority  to  determine  fair  profits.  The  right  to  buy  and  sell 
flour  at  reasonable  prices  was  not  used  except  in  the  cases  of  exports 
and  of  use  by  the  Government  or  governmental  agencies. 

Voluntary  agreements  made  with  the  millers  in  regard  to  the 
wheat  trade  applied  also  to  the  milling  industry.  This  was  true 
also  of  the  license  practices  which  have  been  explained  in  the  wheat 
discussion  above.  One  additional  provision  which  applied  only  to 
flour  was  that  profits  must  be  limited  to  25  cents  a  barrel. 

Considerable  difficulty  was  experienced  in  determining  costs.  To 
have  accomplished  this  task  completely  would  have  required  an  army 
of  auditors  at  w^ork  constantly  on  the  monthly  reports  which  millers 
were  compelled  to  submit.  But  since  the  cost-plus  method  was  to  be 
followed  in  determining  the  selling  price  some  uniform  method  of 
figuring  costs  must  be  adopted,  and  before  November,  1917,  the  fol- 
lowing rule  had  been  presented  to  the  mills : 

In  calculating  profits  the  cost  of  flour,  bulk,  at  the  mill  shall  be  determined 
as  the  cost  of  clean  wheat  used  multiplied  by  the  actual  amount  of  wheat  used 
(which  in  no  event  shall  be  in  excess  of  285  pounds  of  cleaned,  60  pounds  per 
bushel,  wheat  to  the  barrel)  less  the  amount  secured  from  the  sale  of  feed  (ex- 
eluding  the  profit  derived  from  the  sale  of  feed  not  to  exceed  50  cents  per  ton 
as  above)  plus  the  actual  proven  cost  of  production  (which  shall  not  include 
interest  to  investment  and  marketing.) 

In  the  fall  of  1917,  after  the  price  of  wheat  under  Government  con- 
trol became  stabilized  at  a  point  much  lower  than  had  prevailed  in 
the  spring  and  summer  markets  the  rush  of  milling  was  so  great  that 
many  mills  did  not  or  could  not  reduce  the  price  of  flour  fast  enough 


70  HISTORY   OF   PRICES   DURING   THE   WAR. 

to  keep  profits  within  the  margin  of  25  cents  a  barrel.  At  the  end  of 
the  crop  year  (June  30,  1918),  and  in  some  cases  earlier  than  that 
date,  those  mills  which  had  made  profits  above  the  maximum  of 
25  cents  a  barrel  were  compelled  to  return  the  surplus  to  the 
Government.1 

Other  difficulties  met  in  the  operation  of  the  cost-plus  system  were 
the  padding  of  cost  reports  and  the  setting  up  of  jobbing  depart- 
ments in  some  mills  in  order  to  get  both  a  miller's  profit  and  a  job- 
ber's profit  on  their  product.  Although  this  latter  practice  was  per- 
mitted under  the  license  rules,  it  proved  to  be  most  unsatisfactory. 

By  virtue  of  a  presidential  proclamation  of  October  8,  1917,  all 
wholesalers  and  retailers  doing  a  business  of  over  $100,000  a  year 
were  retired  to  take  out  licenses  prior  to  November  1.  The  purposes 
of  the  ruling  were  (1)  to  limit  the  prices  charged  by  every  licensee 
to  a  reasonable  margin  over  expenses  and  forbid  the  acquisition  of 
speculative  profits  from  a  rising  market;  (2)  to  keep  all  food  com- 
modities moving  in  as  direct  a  line  and  with  as  little  delay  as  prac- 
ticable to  the  consumer;  and  (3)  to  limit,  as  far  as  practicable,  con- 
tracts for  future  delivery.  Hoarding  and  speculation  were  not  per- 
mitted under  these  rules.  Licensees  were  limited  to  a  30  days'  supply 
and  notice  was  served  that  a  violation  of  the  rules  constituted  cause 
for  revoking  the  license  as  well  as  subjecting  the  offender  to  criminal 
penalties. 

Control  of  flour  in  1918. — The  plan  of  controlling  flour  millers' 
margins  was  changed  at  the  beginning  of  the  1918  crop  year.  Volun- 
tary agreements  with  all  flour  mills  were  canceled  as  of  June  29, 
1918,  and  the  Milling  Division  of  the  Food  Administration  went  out 
of  existence  on  June  30.  Flour  was  to  be  controlled  through  a  maxi- 
mum "fair  price"  for  the  bulk  product  named  f.  o.  b.  mill  at  every 
producing  point  in  the  United  States.  This  required  the  sending  out 
of  8,500  individual  price  schedules,  one  to  every  licensed  mill 
(which  meant  every  mill)  in  the  country.  It  was  a  physical  impossi- 
bility to  figure  out  this  large  number  of  schedules  in  time  to  get  them 
to  the  mills  on  July  1,  consequently  there  was  an  interim  from  July 
1  until  July  24  for  which  a  subsitute  plan  of  price  control  had  to  be 
announced  and  enforced.  For  this  period  of  slightly  more  than  three 
weeks  a  bulk  flour  basic  price  was  named  at  56  milling  points  of 
the  United  States,  and  each  mill,  regardless  of  location,  was  per- 
mitted to  put  a  sale  price  on  bulk  flour  equal  to  the  price  at  the 
nearest  one  of  these  56  basic  points,  less  freight  to  that  city. 

With  the  sending  out  of  the  maximum  "fair  price"  schedules, 
effective  July  24,  1918,  a  new  era  came  in  flour  control.  No  longer 

*At  the  present  time  (May  15,  1919)  the  Food  Administration  still  has  auditors  in  the 
field  to  check  up  expense  items  of  mills.  Although  a  few  mills  have  retained  their  excess 
profits  for  two  years,  they  will  now  be  compelled  to  part  with  them. 


GOVERNMENT    CONTROL    OVER   PRICES.  71 

was  there  an  opportunity  for  padded  cost  reports.  Not  only  had  each 
mill  been  given  a  schedule  showing  the  price  of  bulk  flour  at  its  door, 
but  every  State  food  administrator  and  zone  agent  had  a  copy  of 
the  schedule  to  assist  him  in  enforcing  this  fair  price.  Maximum 
prices  were  in  effect,  with  the  Government  naming  each  mill's  maxi- 
mum charge. 

The  bulk  flour  price  for  each  mill  was  arrived  at  by  taking  the 
"fair  price"  of  wheat  at  the  nearest  terminal,  plus  freight  to  the 
mill,  plus  $1.10,  called  a  conversion  charge  (to  cover  cost  of  milling 
and  profit),  minus  the  feed  return. 

For  the  guidance  of  the  miller,  there  was  issued  a  table  of  "Maxi- 
mum permissible  margins  over  bases  on  various  classes  of  sale." 
When  selling  flour  to  one  of  the  classes  of  customers  on  this  table 
(and  all  classes  were  included)  he  might  add  to  the  schedule  price  the 
margin  permitted  for  that  class,  plus  items  to  cover  freight  and  cost 
of  sacks.  In  other  words,  he  would  make  out  a  table  like  the  follow- 
ing, showing: 

Method  of  calculating  maximum,  delivered,  fair  price  flour  per  barrel. 

(a)   Maximum  fair  price  bulk  mill  as  per  schedule  No.  000 $10.50 

(&)   Maximum  differential,  if  any,  on  sale  of  class  C .25 

(c)  Freight  charge   (including  freight  tax) .40 

(d)  Cost  of  sacks  (98  pounds  cotton  for  flour) __  .  60 


Totall 11.  75 

Also  he  must  place  on  the  contract  a  copy  of  the  reasonable  price 
schedule  furnished  his  mill  by  the  Food  Administration.  On  the  in- 
voice form  which  must  be  executed  in  every  sale  of  over  15  barrels 
of  flour  there  must  likewise  be  a  copy  of  the  reasonable  price  schedule 
and  the  flour  charge  items  appearing  under  "Method  of  calculating 
invoice  price." 

These  precautions  and  requirements  made  the  flour-control  plan 
a  simple,  self -policing  system.  If  a  dealer  anywhere  felt  that  a 
miller  had  charged  too  much  for  flour  he  could  submit  the  records 
of  his  purchase  to  the  nearest  Federal  food  administrator  or  zone 
agent  and  learn  immediately  whether  the  "  fair-price "  rules  had 
been  violated. 

After  March  1,  1918,  mills  were  permitted  to  make  but  one  grade 
of  flour  (called  100  per  cent  straight).  Two  months  previous  to 
this  date  the  quantity  of  wheat  which  they  were  allowed  to  use 
for  a  barrel  of  flour  was  reduced  from  285  pounds  to  264  pounds. 
All  regulations,  whether  for  millers,  bakers,  or  dealers,  were  based 
upon  the  license  power,  which  sanctioned  the  revocation  of  license 
in  any  case  of  disobedience. 

Conservation  measures. — Conservation  measures,  of  course,  went 
hand  in  hand  with  price  control,  for  it  was  by  inducing  saving  that 


72  HISTORY   OF   PRICES   DURING   THE   WAR. 

the  Food  Administration  helped  in  some  measure  to  offset  the  short 
supply  of  wheat  and  flour.  At  the  outset  reliance  was  placed  upon 
voluntary  conservation,  stimulated  by  a  wide-spread  propaganda 
carried  on  by  means  of  newspapers  and  billboards.  The  results 
were  not  satisfactory,  however,  and  in  January,  1918,  President 
Wilson  appealed  to  the  people  to  reduce  still  further  their  consump- 
tion of  food.  About  the  same  time  the  Food  Administration  issued 
rules,  effective  February  24,  1918,  requiring  bakers  to  mix  substi- 
tutes with  wheat  flour  in  the  ratio  of  1  to  4,  and  after  January  28 
buyers  at  retail  were  required  to  purchase  1  pound  of  a  substitute 
flour  with  every  pound  of  wheat  flour.  Then  by  requisition  30  per 
cent,  and  later  45  per  cent,  of  the  output  of  the  larger  mills  was 
taken  between  January  and  June,  1918,  in  order  to  get  flour  for 
export  to  the  Allies.1  It  was  only  after  the  wheat  flour  substitute 
rule  was  applied  that  national  saving  was  effective,  the  total  con- 
sumption of  wheat  flour  in  the  United  States  during  the  eight 
months  from  July  1,  1917,  to  February  28,  1918,  being  considerably 
in  excess  of  the  corresponding  figures  during  the  three  years  imme- 
diately preceding  the  wrar.2 

Results  of  flour  control. — Although  the  Food  Administration  dis- 
claimed authority  before  July,  1918,  to  fix  flour  prices,  market  quota- 
tions show  that  the  flour  price  was  kept  relatively  lower  than  the 
wheat  price.  Only  once  during  the  period  of  Government  control 
did  the  flour  curve  run  up  close  to  the  wheat  curve,  and  that  wTas 
during  July,  1918,  after  the  Food  Administration  had  abandoned 
the  1917  plan  of  control  and  before  it  had  launched  the  1918  plan. 
Considering  that  the  wheat  price  was  practically  stationary  through- 
out the  price-control  period,  and  that  before  June.  1917,  the  price 
of  flour  had  frequently  been  above  that  of  wheat,  this  accomplish- 
ment in  price  control  bears  testimony  to  the  effectiveness  of  the  Food 
Administration  effort. 

Further  evidence  of  the  success  of  flour  control  is  gained  from 
an  examination  of  the  flour  market  after  the  food  regulations  were 
discontinued.  On  December  19,  1918,  the  Food  Administration  an- 
nounced that  the  public  was  no  longer  required  to  purchase  wheat 
flour  substitutes,  and  soon  thereafter  all  flour  regulations  were 
abandoned.  The  effect  is  seen  in  market  quotations.  The  January 
price  rose  6J  cents  a  barrel,  the  February  price  34  cents  a  barrel, 
and  in  March  the  price  was  $1  a  barrel  higher  than  it  had  been  at 
the  signing  of  the  armistice  or  for  four  months  preceding  that  event. 

Exercising  bread  control. — Bread  is  not  as  sensitive  to  ordinary 
market  influences  as  are  wheat  and  flour.  When  wheat  and  flour 

1  The  Wheat  and  Flour  Trade  under  Food  Administration  Control,  by  Wilfred  Eldred. 

2  Estimates   of   United    States   Food   Administration,    Statistical    Division,    Information 
Service,  Bulletin  No.   1045. 


GOVERNMENT   CONTROL   OVER   PRICES.  73 

were  at  the  top  of  a  runaway  market  in  May,  1917,  bread,  which 
is  the  premier  among  all  wheat  and  flour  product!,  was  climbing 
only  one-third  as  fast  as  wheat  and  flour.  It  was  not  alarmingly 
scarce  from  day  to  day,  and  its  advance  was  because  of  high  cost  of 
production  rather  than  fear  of  a  famine. 

In  order  to  prevent  profiteering  in  bread,  it  was  announced  by 
presidential  proclamation  on  November  7,  1917,  that  all  bakers  using 
as  much  as  10  barrels  of  flour  a  month  must  take  out  licenses  before 
December  10.  This  regulation  included  hotels,  restaurants,  other 
public  eating  places,  and  clubs  serving  bread  or  other  bakery  products 
of  their  own  baking.  Before  February  4,  1918,  all  unlicensed  bakers 
using  as  much  as  three  barrels  of  flour  a  month  were  required  to 
procure  licenses. 

One  of  the  first  tasks  attempted  by  the  Baking  Division  of  the 
Food  Administration  was  to  standardize  the  baker's  bread  of  the 
country.  By  fixing  the  weight  of  the  loaf  at  1  pound  minimum,  with 
1J,  2,  and  1  pound  loaves,  and  with  a  stabilized  price  for  flour, 
it  was  anticipated  that  the  variables  in  bread  would  be  largely  elimi- 
nated and  competition  would  be  centralized  upon  price.  Loaves  of 
other  sizes  were  authorized  later. 

The  Food  Administration  announced  that  it  had  no  power  to  fix 
bread  prices,  but  it  could  limit  profits,  determine  fair  profits,  and 
issue  regulations  for  its  licensees.  It  curtailed  the  use  of  ingredients 
other  than  flour,  yeast,  and  salt,  reaffirmed  an  earlier  request  by  the 
commercial  economy  committee  of  the  Council  of  National  Defense 
that  the  bakers  refuse  to  receive  returned  'bread  and  urged  bakeries 
and  stores  to  use  as  far  as  possible  the  "  cash-and-carry  "  system. 

No  change  was  made  in  the  policy  not  to  fix  bread  prices,  regula- 
tion being  effected  through  the  stabilization  of  flour  prices  and  the 
control  of  bakers'  profits.  Rebates  or  discounts  to  favored  customers 
were  classed  as  unfair  practices. 

The  Food  Administration,  acting  under  the  license  clause,  could 
have  in  effect  fixed  maximum  prices  for  bread,  but  this  was  not  done. 
The  power  to  revoke  bakers'  licenses  was  found  sufficient  to  enforce 
the  control  desired.  Occasionally  other  weapons  were  used,  but  the 
suspension  of  the  license  for  a  few  days  generally  proved  ample. 

Results  of  "bread  control. — Licensing  the  bakers  caused  the  bread 
price  to"  decline  15  per  cent  in  December,  1917.  The  price  remained 
at  this  level  (6.4  cents  a  pound  loaf)  for  four  months,  after  which 
it  came  up  to  7.78  cents  a  loaf,  or  to  a  point  3  per  cent  above  the  price 
for  the  six  months  immediately  preceding  Government  regulation 
of  the  baking  industry.  From  March,  1918,  until  the  close  of  hos- 
tilities in  Europe  the  price  remained  at  practically  the  same  level. 
In  other  words,  with  the  exception  of  one  prominent  decline  when  the 
Government  first  began  to  apply  supervision,  the  price  of  bread 


74  HISTORY   OF   PRICES   DURING   THE   WAR. 

averaged  somewhat  higher  after  the  bakers  were  licensed  than  it  had 
been  when  wheat  and  flour  were  at  their  highest  points  in  May,  1917. 

With  the  relaxation  of  Food  Administration  restrictions,  about 
January  1,  1919,  the  bread  price  advanced  to  8.5  cents,  remaining  at 
this  figure  during  the  first  four  months  of  1919.  Thus,  as  soon  as  the 
Food  Administration  influence  was  withdrawn,  the  price  went  up  11 
per  cent. 

SwrvmciA^y. — Government  control  of  prices  as  a  war  emergency 
measure  took  various  forms  in  its  relation  to  wheat,  flour,  and  bread. 

The  wheat  price  originally  was  fixed  by  statute  as  a  minimum  price. 
A  committee  of  the  executive  department  then  determined  what 
would  be  a  "  fair  price  "  (20  cents  above  the  minimum),  and  this  was 
announced  and  enforced  as  both  a  minimum  and  maximum  price.  It 
was  practically  an  invariable  price.  In  the  beginning  the  price  was 
maintained  by  means  of  voluntary  agreements  between  the  Food  Ad- 
ministration on  the  one  hand  and  the  elevators  and  mills  on  the 
other.  Ultimately  the  wheat  price  of  $2.26  a  bushel  at  Chicago  was 
treated  merely  as  a  "  fair  price,"  neither  minimum  nor  maximum. 
The  "  fair  price  "  was  made  practically  absolute  by  fixing  in  July, 
1918,  a  maximum  fair  price  for  flour  at  each  mill,  and  basing  the 
prices  named  in  this  maximum  fair  price  schedule  on  the  governmental 
"  fair  price  "  for  wheat  at  the  various  interior  primary  markets,  with 
allowances  for  freight  to  the  milling  point.  During  the  first  year 
of  Food  Administration  history  the  price  of  flour  was  not  fixed,  but 
mills  agreed  to  buy  wheat  only  at  the  "  fair  price,"  and  on  the  1917 
crop  manufacturers'  profits  were  limited  to  25  cents  a  barrel  on  flour. 
Beginning  July  24,  1918,  a  maximum  fair  price  was  enforced  for 
flour.  It  was  by  virtue  of  the  Government's  power  to  issue  and  regu- 
late trade  licenses  that  this  control  was  exercised.  Prices  were  never 
fixed  for  bread.  Control  was  exercised  under  the  license  power  by 
limiting  profits,  preventing  unfair  practices,  and  standardizing  the 
weight  of  the  loaf. 

The  three  charts  presented  here  represent  wholesale  wheat,  flour, 
and  bread  prices  in  Chicago,  Minneapolis,  and  New  York,  respec- 
tively, from  January  1, 1913,  to  December  31, 1918.  These  curves  are 
made  from  relative  prices  on  a  comparable  scale.  It  will  be  observed 
that  the  flour  curve  drops  below  the  wheat  curve  soon  after  the  pas- 
sage of  the  food  control  act,  and  that  it  remains  below  throughout 
the  period  of  Government  control.  It  is  not  so  regular  as  the  wheat 
line,  having  a  downward  swing  in  the  early  months  of  1918  and  an 
abrupt  ascent  in  July  while  a  new  plan  of  control  was  being  held  in 
abeyance.  The  two  curves  are  similar,  however,  and  far  below  the 
high  points  at  the  beginning  of  the  war. 

It  is  interesting  to  note  that  after  the  middle  of  1916,  flour,  which 
is  not  a  finished  product,  went  up  much  faster  and  further  than 


GOVERNMENT    CONTROL   OVER   PRICES. 


75 


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HISTORY   OF   PRICES   DURING   THE   WAR. 


bread.  Furthermore,  the  advent  of  the  Government  as  a  price  fixer 
for  flour  brought  the  curve  down  very  decidedly,  whereas  bread, 
which  was  not  subjected  to  price  fixing,  continued  at  a  higher  level 
than  any  point  it  had  reached  before,  with  the  exception  of  four 
months  immediately  following  the  licensing  of  the  bakers. 

The  accompanying  tables  show  price  increases  immediately  fol- 
lowing the  abandonment  of  food  control.  The  wheat  price,  even 
though  wheat  was  still  under  a  minimum  price  guarantee,  acted  in 
like  manner.  It  was  stated  above  that  it  was  by  means  of  the  maxi- 
mum flour  price  and  the  method  of  calculating  millers'  costs  that 
the  price  of  wheat  was  kept  from  exceeding  the  fair-price  level. 
Following  the  removal  of  flour  regulations,  wheat  displayed  some 
of  the  ordinary  market  traits  during  a  season  of  short  supply. 

WHEAT,   No.  2   RED   WINTER,   CASH,  AT  CHICAGO. 
[$0.9321  per  bushel  =  100.] 


ACTUAL  PRICE. 


Date. 

1913 

1914 

1915 

1916 

1917 

1918 

1919 

Year 

SO.  9888 

$1.  0024 

$1.3119 

$1.3731 

$2.  2779 

$2  2094 

Quarters: 
First 

1.0774 

.9596 

1.5104 

1  2270 

1.  9107 

2  1700 

Second  

1.0448 

.9356 

1.4627 

1.1373 

2.  7136 

2.1700 

Third  .... 

.8919 

.9614 

1.1111 

1  3882 

2.  2608 

2.  2392 

Fourth 

9413 

1  1532 

1  1632 

1  7400 

2  1700 

2  2582 

Months: 
January  

1.  1144 

.9690 

1.  3910 

1.28% 

1.9024 

2.1700 

$2.  3788 

February. 

1.0793 

.9602 

1.6091 

1.  2585 

1.7969 

2.1700 

2  3450 

March    * 

1  0385 

9495 

1  5311 

1  1328 

1  9781 

2  1700 

2  35n5 

April. 

1.0586 

.9386 

1.5916 

1.2153 

2.4672 

2.1700 

fiav  I..::::..,..:.:.:.:.:.:. 

1.0557 

.9763 

1.5700 

1.1554 

2.  9705 

2.  1700 

June  
July 

1.0200 
8836 

.8918 
8210 

1.2265 
1.1611 

1.0413 
1  1597 

2.6388 
2.3310 

2.1700 
2.2470 

August  . 

.8705 

.9563 

1.0963 

1.4706 

2.  2503 

2.  2325 

September 

.9216 

1  1069 

1  0760 

1  5344 

2.  1775 

2.  2363 

October  

November 

.9216 
.9447 

1.  108*) 
1.1486 

1.  1325 
1.  12.50 

1.6809 
1.8116 

2.1700 
2.1700 

2.2345 
2.  2375 

December 

9575 

1  2023 

1  2322 

1.7275 

2  1700 

2.3088 

RELATIVE  PRICE. 


Ye?r 

106 

108 

141 

147 

244 

237 

Quarters: 
First 

116 

103 

162 

132 

205 

233 

Second  .  . 

112 

100 

157 

122 

291 

233 

Third 

96 

103 

119 

149 

243 

240 

Fourth 

101 

124 

125 

187 

233 

242 

Months: 
January.  . 

120 

104 

149 

138 

204 

283 

255 

February 

116 

103 

173 

135 

193 

233 

252 

March  

111 

102 

164 

122 

212 

233 

253 

April 

114 

101 

171 

130 

265 

233 

May 

113 

105 

168 

124 

319 

233 

June 

i09 

96 

132 

112 

283 

233 

lulv 

95 

88 

125 

124 

250 

241 

August 

93 

103 

118 

158 

242 

240 

September 

99 

119 

115 

165 

234 

240 

October 

99 

119 

121 

180 

233 

240 

November 

101 

123 

121 

194 

233 

240 

December 

103 

129 

132 

185 

233 

248 

GOVERNMENT   CONTROL   OVER   PRICES. 


77 


FLOUR,    WHEAT,   STANDARD    PATENTS,    AT    MINNEAPOLIS. 
[$4.5699  per  barrel  of  196  pounds- 100.] 


ACTUAL  PRIC". 


Date. 

1913 

1914 

1915 

191G 

1917 

1918 

]919 

Year 

$4.  5837 

$5.  0962 

$6.  6630 

$7.  2639 

$11.  3909 

$10.  1407 

Quarters: 
First 

4.4584 

4.  5708 

7.  3492 

6.3217 

9.2981 

10.  1538 

Second 

4.7096 

4.5508 

7.  3942 

6.  0571 

13.  5731 

9.  7942 

Third                                .  .. 

4.6833 

5.3488 

6.  2242 

7.  3767 

12.  3904 

10.  3992 

Fourth 

4.  4746 

5.8625 

5.  7479 

9.2621 

10.  3404 

10.  2100 

Months: 
January                           -  - 

4.  4813 

.5000 

6.8563 

6.6438 

9.2150 

10.  0850 

$10.  2750 

FebruaVy 

4.5188 

.5875 

7.7063 

6.4400 

9.0688 

10.3000 

10.5500 

March                      

4.3750 

.6250 

7.  4850 

5.8813 

9.6313 

10.  0933 

11.  2125 

April 

4.6100 

.5500 

7.7063 

6.2188 

11.6188 

9.  9850 

May  . 

4.6563 

.6125 

7.8813 

6.1900 

14.8800 

9.  5250 

4  8625 

4900 

6  5950 

5.7625 

13.  8938 

9  8250 

July 

4.7700 

.5938 

7.  0313 

6.1000 

12.7500 

10.  7120 

4  7000 

5  5125 

6  3100 

7.6050 

13.0688 

10.2100 

September 

4.5800 

5.9400 

5.  3313 

8.  4250 

11.  2625 

10.  2100 

October  

4.4563 

5.  7563 

5.5188 

9.2800 

10.6000 

10.2100 

4  4875 

5  8813 

5  5000 

9.  8250 

10.  2250 

10.  2100 

December 

4.4800 

5.9500 

6.  2250 

8.6813 

10.  1313 

10.  2100 

RELATIVE  PRICE. 


Year 

100 

112 

146 

159 

249 

222 

Quarters: 
First 

98 

100 

161 

138 

203 

222 

Second 

103 

100 

162 

133 

297 

214 

Third  

102 

117 

136 

161 

271 

228 

Fourth 

98 

128 

126 

203 

226 

223 

Months: 
January       

98 

98 

150 

145 

202 

221 

225 

February 

99 

100 

169 

141 

198 

225 

231 

March  

96 

101 

164 

129 

211 

221 

245 

April 

101 

100 

169 

136 

254 

219 

May 

102 

101 

172 

135 

326 

208 

June    

106 

98 

144 

126 

304 

215 

July 

104 

101 

154 

133 

279 

234 

August 

103 

121 

138 

166 

286 

223 

100 

130 

117 

184 

246 

223 

October 

98 

126 

121 

203 

232 

223 

November 

98 

129 

120 

215 

224 

223 

98 

130 

136 

190 

222 

223 

BREAD,  LOAF,  AT  NEW  YORK. 
[$0.0412  per  16  ounces  of  unbaked  dough=lOO.] 


ACTUAL  PRICE. 


Date. 

1913 

1914 

1915 

1916 

1917 

1918 

1919 

Year     . 

10.  0424 

$0.0442 

$0.  0475 

$0.  0477 

$0.  0693 

$0.  0738 

Quarters: 
First 

0424 

0429 

0492 

.0449 

.  0593 

.0640 

Second 

.0424 

.0434 

.0474 

.0452 

.0710 

.0778 

Third 

0424 

.0455 

.0478 

.0454 

.0753 

.0773 

Fourth 

0424 

0449 

0457 

.0553 

.0715 

.0762 

Months: 
January  

.0424 

.0434 

.0474 

.0449 

.0571 

.0640 

$3.0850 

February. 

.0424 

.0427 

.0420 

.0440 

.0582 

.0640 

.0850 

March 

.0424 

.0427 

.0582 

.0449 

.0627 

.0640 

.0850 

April... 

.0424 

.0427 

0465 

.0449 

.0640 

.0778 

.0850 

Mav 

0424 

0427 

0474 

0449 

.0738 

.0778 

June 

.0424 

.0449 

.0483 

.0457 

.0753 

.0778 

July 

0424 

0441 

0492 

.0457 

.0753 

.0778 

0424 

0483 

0492 

0449 

0753 

.0778 

September 

0424 

.0441 

.0449 

.0457 

.0753 

.0762 

October 

0424 

0449 

0449 

.0533 

.0753 

.0762 

0424 

0449 

0449 

0545 

.0753 

.0762 

December 

.0424 

.0449 

.0474 

.0582 

.0640 

.0762 

78 


HISTORY   OF  PRICES  DURING   THE   WAR. 


BREAD,  LOAF,  AT  NEW  YORK— Continued. 

RELATIVE  PRICE. 


Date. 

1913 

1914 

1915 

1916 

1917 

1918 

1919 

Year.... 

103 

106 

115 

115 

168 

179 

Quarters: 
First  

103 

104 

119 

109 

144 

155 

Second 

103 

105 

115 

109 

172 

189 

Third  

103 

107 

115 

110 

183 

187 

Fourth 

103 

109 

111 

134 

173 

185 

Months:  . 
January  . 

103 

105 

115 

109 

139 

155 

206 

February..  . 

103 

104 

102 

109 

141 

155 

206 

March. 

103 

104 

141 

109 

152 

155 

206 

April 

103 

104 

113 

109 

155 

189 

206 

May  

103 

104 

115 

109 

179 

189 

June.  . 

103 

109 

117 

111 

183 

189 

July  

103 

107 

119 

111 

183 

189 

August 

103 

117 

119 

109 

183 

189 

September 

103 

107 

109 

111 

183 

185 

October  

103 

109 

109 

129 

183 

185 

November 

103 

109 

109 

132 

183 

185 

December  

103 

109 

115 

141 

155 

185 

SUGAB. 

It  might  be  supposed  at  first  thought  that  the  estimated  world  sugar 
supply  of  18,659,792  tons  for  1917,  as  against  an  average  prewar 
production  of  18,712,997  tons,  was  adequate  enough  not  seriously  to 
trouble  the  Food  Administration.  And,  by  comparison  with  the 
complexities  of  the  wheat  and  meat  control,  perhaps,  sugar  control 
was  less  of  a  problem.  But  with  these  exceptions  it  was  the  most 
important  of  the  food  controls  and  affords  an  interesting  and  dis- 
tinctive experience  with  price  regulation.  It  was  the  cutting  off  of 
sugar  from  Germany,  and  the  shortage  of  ships  to  distribute  the 
available  supply,  which,  more  than  a  falling  off  in  actual  world 
production,  made  sugar  control  a  problem. 

The  shutting  off  of  German  supplies  from  Great  Britain  and 
France,  together  with  submarine  ravages,  had  made  these  two  coun- 
tries dependent  upon  the  Western  Hemisphere  for  their  sugar.  By 
1916  the  largest  part  of  the  sugar  consumed  by  the  allied  countries 
came  from  the  United  States  and  Cuba.  The  United  Kingdom  in 
that  year,  for  example,  took  some  500,000  tons  of  sugar1  from  us 
and  an  equal  amount  from  Cuba,  whereas  her  normal  receipts  from 
both  these  sources  combined  had  in  the  past  averaged  approximately 
300,000  tons  only.  Moreover,  the  north  European  neutrals,  and  other 
countries  in  Asia,  Africa,  and  South  America,  which  had  also  been 
shut  off  from  German  and  Austrian  supplies,  had  entered  western 
markets.  Thus  by  1916  our  sugar  exports  had  amounted  to  1,630,- 
000,000  pounds,  which  was  approximately  3,000  per  cent  more  than 
was  shipped  from  the  United  States  in  the  year  preceding  the  out- 
break of  the  world  war.  And  yet,  at  the  same  time,  due  to  lack  of 
shipping  space,  large  stocks  were  accumulating  in  Java. 

This  drain  upon  Cuban  and  American  stocks  was,  of  course,  re- 
flected in  the  market  price  of  sugar,  and  by  August,  1917,  raw  sugar 

i  Exports  of  sugar  to  the  United  Kingdom  for  the  fiscal  year  ending  June,  1916,  amounted  to  932,458,- 
299  pounds,  according  to  the  figures  of  the  United  States  Department  of  Commerce. 


GOVERNMENT   CONTROL   OVER   PRICES. 


79 


prices  had  reached  a  point  100  per  cent  higher  than  ^lie  average  for 
the  year  preceding  the  outbreak  of  the  world  war.1 

It  was  thus  evident,  immediately  upon  the  inauguration  of  the 
Food  Administration,  that  measures  must  be  taken  to  check  the  rise 
of  sugar  prices.  Accordingly  one  of  the  first  official  acts  of  Mr. 
Hoover  was  the  appointment  on  August  15  of  Mr.  George  M.  Rolph 
to  head  a  Sugar  Division.  Three  weeks  later  a  presidential  procla- 
mation required  all  importers,  manufacturers,  and  refiners  of  sugar, 
sugar  sirups,  and  molasses  to  secure  licenses  from  the  Food  Admin- 
istration, and  on  October  1  virtually  the  entire  sugar  industry  was 
brought  under  license  control.  Before  the  inauguration  of  the  license 
system,  however,  steps  had  been  taken  toward  fixing  maximum  pro- 
ducer's prices  for  sugar  through  voluntary  agreement.  The  first  of 
such  agreements  was  arranged  writh  the  beet-sugar  interests. 

The  beet-sugar  control. — Mr.  Hoover  announced,  as  early  as  Au- 
gust 25,  1917,  that  the  producers  of  beet  sugar  had  agreed  to  sell 
their  new  crop  at  $7.25  per  hundredweight,  cane  basis,  at  refining 
points  (Boston,  New  York,  Philadelphia,  Savannah,  New  Orleans, 

i  The  effect  of  the  shipping  shortage,  and  the  concentration  of  sugar  demands  upon  the  American  and 
Cuban  markets,  upon  sugar  prices  is  presented  in  the  appended  table.  The  temporary  rise  in  the  summe 
of  1914  is  to  be  explained  by  the  large  purchases  of  Great  Britain  following  the  declaration  of  hostilities,  and 
by  a  panic  among  American  consumers  who  rushed  into  the  market  and  bought  up  large  supplies  because 
of  a  fear  of  shortage  and  higher  prices.  These  prices  were  taken  from  Willett  &  Gray's  Weekly  Statistical 
Sugar  Trade  Journal. 

United  States  price  of  raw  and  refined  sugar,  1913-1918 

KAW  CAKE  SUGAR. 

[96°  centrifugal;  duties  paid  at  New  York.] 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January 

$0  0353 

$0  0332 

$0  0305 

$0  0465 

$0  0524 

$0  0601 

FebruaVv 

0349 

0344 

0468 

0491 

0517 

0601 

March.... 

.  0355 

.0298 

.0482 

0564 

0548 

0601 

April 

.  0339 

0298 

0480 

0616 

0621 

0601 

Mav 

0334 

0326 

0484 

0643 

0608 

0601 

June 

0334 

0334 

0491 

0632 

0604 

0602 

July 

.0355 

.0328 

0485 

0630 

0662 

0606 

August 

0374 

0570 

0475 

0558 

0727 

0606 

Sppt.pTn  hor 

0372 

0580 

0427 

0555 

0696 

0697 

October  . 

.  0350 

.0446 

0411 

0626 

06°0 

0728 

November  .... 

0362 

0391 

0475 

0621 

0690 

0728 

December 

0335 

0396 

0492 

"  0531 

0634 

0728 

BEFTNED  CANE  SUGAR. 

[Fine  granulated  in  bags  or  barrels  at  New  York.] 


January 

$0  0450 

fO  0392 

$0  0488 

$0  0573 

$0  0662 

$0  0744 

February  

0418 

0392 

0554 

05Q7 

0686 

0730 

March.... 

0419 

0382 

0571 

0657 

0706 

0730 

April 

0410 

0372 

0578 

0706 

0815 

0730 

May 

0410 

0397 

0588 

0746 

0794 

0730 

June  

0414 

0417 

0588 

0736 

0754 

0731 

July...  . 

0447 

0420 

0582 

0750 

0745 

0735 

August 

0461 

0649 

0549 

0700 

0818 

0735 

September  

0453 

0680 

0506 

0637 

0823 

0845 

October  

0419 

0593 

0497 

0708 

0818 

0882 

November  

0421 

0493 

0568 

0735 

0818 

0882 

December. 

0408 
.0408 

0483 

05°  9 

069° 

0804 

0882 

80  HISTORY   OF   PRICES   DURING   THE   WAR. 

and  San  Francisco).1  This  price  was  later  raised  to  $7.35  and  $7.45 
on  December  12  and  January  8,  respectively,  in  order  that  it  might 
conform  more  nearly  to  the  price  of  cane  sugar,  which  was  estab- 
lished by  agreement  with  the  Cuban  producers,  whose  product  is  the 
basis  for  the  price  of  the  entire  domestic  sugar  crop,  including  that 
from  Hawaii  and  Porto  Rico. 

Shortly  after  the  fixing  of  the  beet-sugar  prices  by  agreement  it 
became  evident  that  with  the  elimination  of  normal  competitive 
methods  of  bidding  for  sugar  supplies  some  arbitrary  method  of 
distribution  would  be  necessary.  Accordingly  there  was  appointed 
a  sugar  distributing  committee  to  allot  the  available  sugar  to  dealers 
in  various  localities.  Representatives  of  this  committee  were  scat- 
tered throughout  the  country  and  prices  at  different  distributing 
points  were  established  by  adding  freight  from  the  nearest  seaboard 
refinery  to  the  base  price  at  that  seaboard  point.2  It  was  hoped  thus 
to  effect  an  equitable  distribution  of  sugar  and  a  saving  in  freight 
costs.  Cross  shipments  were  eliminated  wherever  possible  and,  con- 
trary to  the  usual  custom  of  shipping  sugar  as  much  as  half  way 
across  the  continent,  individual  localties  were  supplied  by  the  nearest 
refineries. 

Control  over  the  cane-sugar  supply. — The  regulation  of  the  beet- 
sugar  supply,  however,  could  not  of  itself  solve  the  sugar  situation, 
for  beet  sugar  represents  a  small  part  only  of  our  total  consumption. 
Cuba  ordinarily  furnishes  the  greater  part  of  our  sugar  supplies,  and 
it  soon  became  necessary,  therefore,  to  devise  methods  of  controlling 
the  price  of  Cuban  sugar  as  well.  That  necessity  was  especially 
acute,  for  the  Cuban  supplies  of  raw  sugar  seemed  too  small  even  to 
meet  our  own  demands.  Moreover,  the  foreign  Governments  were 
bidding  against  each  other  and  against  the  American  refiners  for 
these  scanty  supplies.  Under  such  competition  it  was  apparent  sugar 
prices  could  not  be  kept  stable.  The  entire  sugar-refining  industry 
agreed  to  keep  out  of  the  Cuban  and  other  raw-sugar  markets  and  to 
obtain  their  supplies  through  a  purchasing  body  created  by  the  Food 
Administration.  This  body,  appointed  on  September  21,  was  the 
International  Sugar  Committee,  formed  by  agreement  with  England, 
France,  and  Italy  to  arrange  for  the  purchase  and  distribution  of  the 
available  sugar  for  the  allied  Governments  and  for  all  allotments  to 
neutrals.  There  was  also  appointed  to  cooperate  with  this  interna- 
tional committee  a  committee  of  American  refiners,  whose  business 
it  was  to  allocate  among  our  refiners  all  -sugar  set  aside  for  the 
United  States.  This  committee  later  became  very  active  and  had 
as  its  almost  daily  task  the  alloting  to  refiners  of  all  sugar  receipts 

1  It    should    be    noted    that   this   one    is    the    first    price-fixing    agreement   entered    into 
directly  by  the  United  States  Food  Administration.     The  price  of  wheat  had  been  fixed 
on  Aug.  10  by  congressional  legislation. 

2  To  the  price  of  beet  sugar  at  the  seaboard  refining  points,  i.  e.,  $7.25,  the  transporta- 
tion cost  to  interior  points  was  added. 


GOVERNMENT    CONTROL   OVER   PRICES.  81 

from  Cuba,  Porto  Rico,  and  other  sources.  In  such  a  manner  was 
competition  in  the  world's  sugar  market  eliminated  and  conditions 
made  favorable  for  negotiating  with  the  various  producers  for  raw- 
sugar  supplies. 

The  Food  Administration,  now  in  a  position  through  the  sugar 
committee  to  bargain  with,  the  cane  producers  for  favorable  prices, 
entered  into  an  agreement  with  the  Louisiana  planters  which  resulted 
in  the  fixing  of  a  price  on  October  23,  1917,  for  Louisiana  raw  sugar 
of  $6.35  per  hundredweight  at  Xew  Orleans.  There  having  been 
fixed  a  price  for  beet  sugar  and  the  entire  domestic  production  of 
cane  sugar,  it  remained  still  to  grapple  with  a  more  definite  price 
control  over  Cuban  cane  sugar.  The  first  move  in  this  direction  was  the 
purchase  by  the  International  Sugar  Committee  of  the  small  remain- 
der of  the  old  1916-17  crop  of  Cuban  sugar  at  $6.75  delivered  at  New 
York  duty  paid  and  an  attempt  to  secure  the  new  crop,  wrhich  was  due 
the  first  of  1918.  Accordingly,  conferences  were  held  with  the  Cuban 
producers  in  the  hope  of  fixing  a  price  for  the  Cuban  crop.  After  a 
considerable  delay,  and  the  entrance  of  the  Cuban  Government  and 
our  State  Department  into  the  negotiations,  an  agreement  was  finally 
made  on  December  24  whereby  three-fourths  of,  or  (upon  option)  the 
entire  new  Cuban  crop  was  to  be  sold  to  the  International  Sugar  Com- 
mittee at  $4.60  f.  o.  b.  Cuban  ports.  That  price,  after  adding  freights, 
duty,  and  other  costs,  was  equivalent  to  about  $6  1  f.  o.  b.  New  York.2 

The  Food  Administration  was  thus  instrumental  in  bringing  all 
of  the  immediately  available  supplies  of  raw  sugar  under  the  control 
of  the  Allies.  Further  precautions  were  taken  by  placing  embargoes, 
through  the  War  Trade  Board,  upon  the  export,  of  sugar  from  the 
United  States,  and  by  asking  the  Cuban  Government  to  prohibit  all 
shipments  of  sugar  to  any  country  other  than  the  United  States  or 
her  Allies. 

The  distribution  of  refined  sugar. — Shortly  after  a  price  for  the 
raw  sugar  supply  had  been  decided  upon,  it  was  thought. advisable  to 
limit  the  costs  of  fabrication  and  distribution,  in  order  that  the  ulti- 
mate cost  to  the  consumer  might  be  kept  at  a  nominal  level.  For  this 
purpose,  the  refiners  were  asked  in  September,  1917,  to  fix  a  margin 
between  the  cost  of  raw  sugar  and  the  selling  price  of  refined  sugar 
for  which  they  were  willing  to  operate.  This  refining  margin,  based 
on  a  prewar  average,  was  placed  at  $1.30  per  100  pounds.  It  was 
later,  after  investigation  of  refining  costs  by  Mr.  Oscar  Straus, 

1  On  June  24,  1918,  the  increased  insurance  rates  caused  by  the  presence  of  German 
submarines  off  the  American  coast  caused  a  rise  in  the  New  York  price  to  $6.05. 

2  It   is  of   interest   to  note  that  before   making  this   final   agreement  with   the   Cuban 
producers,  the  United  States  Food  Administration  rendered  aid  both  to  the  Cuban  Gov- 
ernment and  the  Cuban  sugar  industry,  in  order  that  the  sugar  crop  might  be  more  easily 
marketed.     At  the  suggestion  of  the  Food  Administration,  for  example,  the  Cuban  Gov- 
ernment loaned  to  the  Cuban  Railway  $5,000,000  in  order  that  the  road  might  be  put 
into  better  condition  for  handling  the  crop.     The  Food  Administration  also   played   an 
important  part  in  getting  some  50  American  business  firms,  who  had  orders  for  supplies 
which  were  needed  in  harvesting  the  Cuban  crops,  to  rush  such  supplies  through  and  to 
fill  orders  for  articles  which  the  Cuban  authorities  were  having  difficulty  to  secure. 

125547'°— 20 6 


82  HISTORY   OF  PRICES   DURING  THE   WAR. 

increased  to  $1.45  per  100,  effective  August  1,  1918.  This  differential 
included,  incidentally,  a  brokerage  charge  ranging  from  3  to  5  cents 
per  100  pounds,  which  might  be  paid  to  agents  for  selling  sugar  to 
wholesalers  and  jobbers.1  At  the  same  time,  the  refiners  agreed  to 
confine  their  sales  to  certain  limited  territories. 

With  the  price  of  sugar  so  minutely  regulated  in  both  its  raw  and 
refined  state,  it  appears  that  the  interests  of  the  American  consumer 
had  been  fairly  well  provided  for.  The  licensing  system  limited 
the  profits  of  the  wholesaler  and  jobber  to  the  prewar  normal,  which 
averaged  about  25  cents  per  100  pounds,2  and  the  only  remaining 
'avenue  of  profiteering  was  the  retail  distributor.  Methods  of  deal- 
ing with  the  latter  have  been  discussed  in  previous  pages.3 

The  Sugar  Equalization  Board. — No  sooner  had  all  arrangements 
been  completed  for  the  purchase  and  disposal  of  the  1917-18  sugar 
crops  by  the  above  committee  and  the  Food  Administration  than  it 
became  necessary  to  provide  for  the  crop  of  the  year  to  follow. 
This  was  especially  imperative,  since  the  requirements  of  the  Allies 
demanded  the  greatest  possible  stimulation  both  of  cane  and  beet 
sugar  production.  If  the  estimate  made  in  the  late  spring  of  1918 
that  the  United  States  would  produce  1,600,000  tons  of  sugar  was 
accurate,  it  meant  that  the  balance  of  our  4,000,000-ton  requirement 
must  be  imported.  Cuba,  of  course,  was  the  logical  source  to  draw 
upon  for  this  balance. 

An  investigation  into  the  costs  of  producing  sugar  showed  that  the 
wholesale  price  of  sugar  could  not  be  brought  below  9  cents  if  the 
Louisiana  cane  producers  and  the  western  beet  raisers  were  allowed 
a  fair  return.4  Accordingly,  an  agreement  was  entered  into  with  the 
Louisiana  cane  producers,  and  the  beet  manufacturers,  by  which  the 
wholesale  price  of  sugar  was  stabilized  at  not  to  exceed  9  cents.5 

It  was  known,  however,  that  the  Cuban  raw  sugar  could  be  sold 
about  IJ  cents  per  pound  cheaper  than  our  domestic  supply  and  at  the 
same  time  leave  a  good  margin  of  profit.  The  price  allowed  to  the 
American  producer,  then,  if  extended  to  the  Cuban  crop  would  have 
meant  tremendous  profits  to  the  Cuban  growers.  On  the  other 
hand,  if  the  American  refiners  were  allowed  to  buy  Cuban  raw  sugar 
at  the  price  the  Cubans  were  willing  to  accept,  and  forced  to  charge 

1  On  Sept.  9,  the  refiner's  margin  was  still  further  increased  to  $1.54  per  100  pounds*. 

2  This  margin  was  increased  in  the  midsummer  of  1918  to  35  cents. 

3  On  Nov.  7,  1918,  the  retailer's  margin  on  sugar  was  fixed  at  $1.12   (bulk)  and  $1  in 
packages. 

4  This  price  was  decided  upon  after  various  meetings  with  the  producers  held  during 
the  early  summer  of  1918.     It  should  be  repeated  once  more  that  the  guiding  motive  in 
fixing  prices  by  the  Food  Administration  was  the  stimulation  of  production.     The  policy 
was  to  put  the  price  at  the  point  at  which  at  least  90  per  cent  of  the  producers  could 
secure  a  fair  profit.     The  interests  of  the  consumer  were  always  considered,   of  course, 
and  made  the  limiting  factor  in  determining  the  price  to  be  fixed.     If  every  producer  of 
sugar  had  been  fully  recompensed  without  consideration  for  the  consuming  public,   the 
price  of  sugar  would  perhaps  have  been  three  times  what  it  actually  was  during  the  war 
period. 

5  The  actual  price  fixed  was  $0.0882.     This  price  made  raw  sugar  $0.0728  per  pound, 
to  which  the  refiner's  margin  of  $0.0154  was  added,     It  went  into  effect  Sept.  9,  1918. 


GOVER^MEITT   CONTROL   OVER   PRICES.  83 

* 

9  cents  per  pound  for  refined  sugar  (the  agreed  selling  price  for  the 
sugar  refined  from  domestic  cane  and  beets),  their  profits  would  be 
far  in  excess  of  those  ordinarily  expected  by  refiners  for  their  services. 
And,  again,  if  Cuban  sugar  came  into  the  United  States  al  the  price 
which  the  Cuban  growers  were  willing  to  accept,  and  the  American 
refiner's  margin  as  determined  earlier  in  the  year  was  added  thereto, 
and  Cuban  refined  sugar  was  sold  at  a  price  considerably  below  9 
cents,  the  domestic  cane  and  beet  raising  industry  would  be  ruined 
and  a  shortage  of  sugar  follow.  A  still  further  problem  was  that  of 
equalizing  the  prices  of  the  old-crop  domestic  sugars  which  were  sell- 
ing at  $7.30  per  hundred  pounds  with  those  of  the  new  1918-19  crop 
which  were  soon  to  appear  at  the  higher  price  of  $8.82. 

The  solution  of  these  problems  seemed  to  lie  in  some  governmental 
form  of  equalization,  whereby  the  existing  differences  in  the  costs 
of  the  domestic  and  imported  sugars,  as  well  as  the  differences  be- 
tween the  old  and  new  crop  prices,  would  be  eliminated.  To  attain 
this  end,  the  United  States  Sugar  Equalization  Board  was  incorpo- 
rated in  July,  1918,  with  a  capital  stock  of  $5,000,000,  owned  by  the 
United  States.  The  board,  shortly  after  its  incorporation,  purchased 
all  sugars  produced  from  the  1917-18  crop,  still  in  the  country  or  in 
transit,  at  the  old  price  of  $0.073  per  pound,  and  immediately  resold 
them  to  the  same  holders  at  the  new  price  of  $0.0882.  Thus  the  extra 
profit,  which  would  otherwise  have  gone  to  the  refiners  who  had  pur- 
chased at  the  old  price  and  would  have  sold  at  the  new  price,  was 
absorbed  by  the  Sugar  Equalization  Board.1  In  like  manner  the 
board  bought  up  the  entire  Cuban  1918-19  crop  at  the  price  of  $0.0588 
per  pound  (including  costs  and  freight  to  Philadelphia  and  New 
York),  and  delivered  it  to  American  refiners  on  the  Atlantic  and 
Gulf  coasts  at  $0.0728  per  pound.  Adding  to  the  latter  price  the  re- 
finer's margin  of  $0.0154,  this  sugar  could  be  sold  in  refined  form  at 
the  same  price  as  the  domestic  production,  i.  e.,  $0.0882. 

In  the  price  of  $0.0728  to  the  refiner  there  was,  after  deducting  duty 
and  other  costs,  a  margin  of  some  25  to  38  cents  per  100  pounds.  This 
amount  instead  of  going  to  the  Cuban  producers  or  the  American 
refiners  went  to  the  treasury  of  the  Sugar  Equalization  Board.  Thus 
the  price  of  sugar  was  stabilized  and  the  domestic  industry  preserved, 
while  at  the  same  time  there  went  to  the  United  States  Treasury  a 
considerable  sum  which  would  otherwise,  in  all  probability,  have 
gone  to  the  American  refiners  or  the  Cuban  producers. 

1  The  question  naturally  arises,  What  provisions  were  made  for  the  disposal  of  stocks 
held  by  wholesalers  and  retailers  on  Sept.  7,  when  the  higher  price  went  into  effect,  and 
which  had  been  bought  at  the  lower  price  prevailing  prior  to  this  rise?  The  Food  Ad- 
ministration specifically  stated  that  such  dealers  should  continue  to  sell  all  lower-priced 
stocks  on  the  lower  basis  until  entirely  disposed  of.  Even  the  averaging  of  the  new  and 
old  price  was  prohibited.  When  considered  from  the  standpoint  of  the  individual  dealer, 
the  gains  accruing  from  the  rise  in  price  were  necessarily  small,  for  their  supplies  of 
sugar  were  limited,  the  license  regulations  having  prohibited  them  from  holding  more 
than  a  60-day  supply  at  any  one  time. 


84  HISTORY    OF   PRICES    DURING    THE    WAR. 

The  limitation  of  sugar  consumption. — The  Food  Administration, 
as  well  as  the  consuming  public,  learned  shortly  after  the  inaugura- 
tion of  the  Sugar  Division  that  control  both  of  the  sources  of  raw 
sugar  and  the  prices  of  the  finished  product  would  not  solve  all  the 
difficulties  presented  by  the  shipping  shortage.  There  was,  first, 
the  railroad  blockade  which  made  next  to  impossible  an  equitable 
distribution,  especially  in  the  eastern  section  of  the  country.  Sec- 
ondly, the  harvesting  and  marketing  of  the  Cuban  sugar  crop  begins 
•about  the  first  of  the  year  and  continues  into  the  early  summer. 
The  Javan  crop  usually  follows  and  fills  in  the  void  in  receipts  from 
June  to  October,  when  the  beet-sugar  crop  begins  to  come  in.  The 
Louisiana  crop  first  appears  on  the  market  in  November  and  sup- 
plies our  demand  through  the  Avinter.  The  Javan  crop  was  unat- 
tainable during  the  summer  and  autumn  of  1917,  however,  and  this, 
of  course,  added  to  the  stringency.  Moreover,  the  Atlantic  coast 
refiners  received  considerably  less  Louisiana  sugar  than  usual  in 
late  1917,  for  the  Louisiana  planters  were  selling  washed  and  clari- 
fied sugar  which  they  made  on  their  own  plantations  to  manufac- 
turers of  confections.  They  had  found  that  the  selling  of  sugar  in  this 
semirefined  state  yielded  them  a  larger  profit  than  would  have  been 
secured  for  their  products  had  they  sold  it  in  the  raw  state  to  the 
refiners.1  Third,  an  early  frost  had  perceptibly  cut  down  the 
Louisiana  supply;  and,  finally,  the  demands  of  our  allies  kept  in- 
creasing more  and  more  beyond  expectations. 

Limitation  of  consumption  was,  of  course,  the  logical  solution  of 
this  phase  of  the  sugar  problem,  and  in  October,  1917,  confectioners 
and  manufacturers  of  nonessential  foodstuffs  were  limited  to  50  per 
cent  of  their  normal  requirements.  Early  in  January,  by  reason  of 
the  new  supplies  from  Cuba  and  Louisiana,  this  amount  was  in- 
creased to  80  per  cent  of  normal  requirements.  It  was  later  ruled 
"  that  such  manufacturers  starting  operations  after  November  1. 
1917,  but  before  April  1,  1918,  would  be  limited  to  50  per  cent,  and 
that  those  starting  after  April  1,  1918,  should  be  allotted  no  sugar 
whatever.  Again,  on  July  1,  1918,  all  of  the  less  essential  industries 
were  limited  to  50  per  cent.  Beginning  March  15;  1918,  practically 
all  manufacturers  using  sugar  were  required  to  obtain  certificates 
from  the  Federal  food  administrators  in  their  respective  States, 

1  The  shortage  of  sugar  in  the  fall  of  1917  resulted  in  the  limiting  of  manufacturers 
of  nonessential  foods  to  50  per  cent  of  their  normal  sugar  requirements.  These  manu- 
facturers, however,  could  buy  sirups,  which  they  used  as  substitutes.  Hence,  rather  than 
go  without  sufficient  sugar,  they  were  willing  to  pay  to  the  Louisiana  producers  for 
washed  and  clarified  sugar — which  normally  sold  for  about  one-half  cent  per  pound  less 
than  refined — the  wholesale  price  of  $0.0765  per  pound,  or  the  agreed  price  for  refined 
sugar  ($0.0635 — Louisiana  raw  sugar  price — plus  $0.013,  refiner's  margin).  The  Louis- 
iana producers,  on  the  other  hand,  were  glad  to  sell  this  clarified  and  washed  sugar  at 
$0.0765,  for  it  netted  them  a  larger  profit  than  would  have  been  secured  had  they  sold 
it  in  the  raw  form  to  the  refiners.  This  irregularity  was  later  eliminated  by  fixing 
$0.0725  less  2  per  cent  as  the  maximum  price  at  which  washed,  clarified,  and  open  sugar 
could  be  sold. 


GOVERNMENT   CONTROL   OVER  PRICES.  85 

showing-  amounts  that  they  were  entitled  to  purclia|e,"  x  and  these 
certificates  were  turned  over  to  licensed  wholesalers  and  other  dealers 
when  sugar  purchases  were  made. 

Consumption  by  the  public  in  general  was  also  closely  regulated, 
and  purchases  were  limited  at  first  to  5  pounds  at  a  time  for  urban 
and  10  pounds  for  rural  customers.  In  June  these  rations  were 
changed  to  2  a-nd  5  pounds,  respectively,  and  retailers  were  for- 
bidden to  sell  sugar  to  their  customers  in  quantities  greater  than  3 
pounds  per  person  per  month.  Later  they  were  further  reduced  to 
2  pounds  per  person  per  month.  On  October  30,  with  the  new  crops 
in  view  and  with  improved  railroad  service,  regulations  were  once 
more  modified  and  the  per  capita  allowance  was  restored  to  3  pounds. 
On  November  13  an  allowance  of  4  pounds  was  made  and  manu- 
facturers were  granted  their  full  requirements.  Finally,  on  Novem- 
ber 27,  1918,  all  restrictions  were  repealed  with  but  two  very  im- 
portant exceptions,  namely,  first,  price  control  was  retained,  through 
the  operations  of  the  equalization  board,  over  its  purchase  of  the 
Cuban  1918-19  sugar  crop,  until  supplies  were  disposed  of;  and, 
secondly,  a  restriction  of  distribution  by  refiners  to  certain  territories 
was  retained  in  order  to  maintain  an  equitable  supply  for  all  parts 
of  the  country.2 

Sugar  1) y- products. — The  distribution  of  sugar  by-products,  such 
as  sirups  and  molasses,  and  the  regulation  of  their  prices  were  also 
administered  by  the  Food  Administration.  Molasses  and  sirups  were 
specifically  mentioned  in  the  license  regulations  of  October  and 
November.  1917,  but  only  in  a  general  way.  Indeed,  the  early 
regulations  affecting  these  by-products  may  be  summed  up  in  the 
requirement  that  they  "  be  sold  according  to  the  customs  of  the  trade 
in  the  various  producing  centers  of  the  United  States." 

In  March,  1918,  control  of  the  price  of  molasses  was  first  inaugu- 
rated, and  a  maximum  of  18  cents  per  gallon  in  tank  cars  at  sea- 
board points  was  fixed  for  blackstrap  molasses,  either  imported  as 
such  or  produced  in  the  United  States  from  imported  sugar  cane.3 
Shortly  afterwards,  in  order  that  the  largest  possible  sugar  extrac- 
tion might  be  gotten  from  the  raw  product,  refiners  were  forbidden 

1  See  "  Sugar  Prices  and  Distribution,"  by  Roy  G.  Blakey,  Quarterly  Journal  of  Econom- 
ics, August,  1918.     Figures  taken  from  the  Sugar  Market  Review  show  that  at  least  one- 
fourth  of  the  sugar  consumed  in   the  United  States 'goes  to  the  manufacturer  of  confec- 
tionery and  other  sweet  stuffs. 

2  There  was  al*o  a  considerable  number  of  regulations,  too  numerous  to  mention  in  the 
limited  space  available,  which  indirectly  affected  srgar  prices.     An  equitable  distribution 
among  customers  was  prescribed  ;  only  standard-sized  packages  could  be  used  for  packing 
sugar  ;  stocks  to  be  held  by  any  one  concern  were  limited  ;  advance  contracts  were  lim- 
ited to  a  specified  number  of  days,  etc.     See  Series  VI,  Special  License  Regulations,  Man- 
ufacturers and  Refiners  of  Sugar;  also  Series  I,  Governing  All  Licenses  for  the  Importa- 
tion, Manufacture,  Storage,  and  Distribution  of  Food  Commodities  and  Feeds. 

3  Beet  molasses  was  also  made  subject  to  this  fixed  price  in  June.     A  maximum  of  5 
cents  per  gallon  over  the  bulk  price  of  18  cents  was  permitted  for  barrel  lots.     The  re- 
selling price  of  wholesalers  was  also  regulated  by  the  Food  Administration.     A  maximum 
margin  of  8  to  10  per  cent  was  fixed  by  the  Food  Administration  on  sales  of  molasses  in 
barrels  by  wholesalers  to  retailers. 


86 


HISTORY   OF   PRICES   DURING   THE   WAR. 


deliberately  to  produce  sirups  or  molasses  from  which  sugar  could 
be  commercially  extracted.  In  June  the  price  of  sirups  manufac- 
tured from  imported  raw  cane 
sugar  was  fixed  at  50,  35,  and  25 
cents  per  gallon  for  high,  me- 
dium, and  low  grades,  respec- 
tively. Such  prices  were  for  lots 
purchased  in  bulk  at  primary 
markets.  An  added  differential 
of  5  cents  per  gallon  was  allowed 
for  sales  of  barrel  lots. 

A  system  of  priorities  was 
formulated  for  the  distribution 
of  sirups,  and  distributors  could 
secure  their  needs  only  after  fur- 
nishing a  certificate  of  priority 
from  the  Food  Administration 
showing  the  purpose  for  which 
the  sirup  was  to  be  used.  Mo- 
lasses and  sirups  had  to  conform 
to  certain  specified  standards  and 
rules  were  laid  down  which  regu- 
lated the  method  of  shipping 
these  products.  These  latter  reg- 
ulations were  repealed  on  Decem- 
ber 12,  1918,  and  on  January  10, 
1919,  the  regulation  of  the  prices 
of  molasses  and  sirups  was  with- 
drawn. 

The  results  of  sugar  control. — 
One  of  the  chief  objections  to 
price  control  made  in  the  Senate 
sugar  investigation  of  January, 
1918,  was  that  it  kept  down  pro- 
duction. It  would  seem,  if  that 
be  true,  that  the  Food  Admin- 
istration was  defeating  its  own 
end,  which  was  the  stimulation  of 
production,  by  imposing  fixed 

Relative  prices.— Sugar  :  United  States,  Eng-    prices  *    Upon    raw    SUgar    and    its 
land,  France. — By  months,  January,  1913,         „        ,  -,       ,         rrc,  -,-  a 

to  December,  1918.     (Average  quoted  prices    refined    product.       The    policy    Ot 

July,  1913,  to  June,  1914=100.)  providing   for  the  greater   part 

of  the  producers  when  determining  upon  a  price  to  be  fixed,  ap- 
pears, after  a  review  of  the  situation  existing  in  late  1918,  to  have 
obviated  largely  this  particular  objection.  For  example,  the  total 

1  These  prices,  of  course,  were  the  results  of  voluntary  agreements  between  the  sugar 
producers  and  the  Food  Administration,  as  stated  above. 


GOVERNMENT   CONTROL   OVER.  PRICES. 


87 


domestic  cane-sugar  crop  for  1918-19  (the  first  cro^to  be  influenced 
by  regulation)  was  estimated  to  be  21,000  tons  larger  than  that  of 
the  preceding  year.  Moreover,  the  estimated  output  of  the  present 
Cuban  crop  was  approximately  175,000  tons  larger  than  that  of 
1917-18.  To  be  sure,  the  domestic  beet  area  of  1918  was  some  15 
per  cent  smaller  than  that  of  the  year  before,  but  this  was  due  not 
so  much  to  the  regulated  sugar  price  as  to  the  higher  prices  of  alter- 
native crops  and  the  ill  feeling  among  the  beet  raisers  against  the 
sugar  refiners. 

Judging  from  the  course  of  events  in  England  and  France,  it 
might  be  supposed  that  the  policy  of  the  Food  Administration  had 
a  considerable  effect  upon  refined  sugar  prices.  American  wholesale 
sugar  prices  rose  but  17  per  cent  from  August,  1917,  the  month  in 
which  the  Food  Administration  was  inaugurated,  to  the  signing  of 
the  armistice.  French  prices,  on  the  other  hand,  rose  157  per  cent 
in  the  like  period,  while  in  England  an  increase  of  94  per  cent  was 
experienced.  The  course  of  sugar  prices  from  January,  1913,  to  De- 
cember, 1918,  in  the  United  States,  England,  and  France  is  here  pre- 
sented graphically.  The  prices  for  each  month  have  been  reduced 
to  a  prewar  basis,  by  allowing  the  average  of  the  monthly  prices 
for  the  year  July,  1913,  to  June,  1914,  to  equal  100. 

LIVE  STOCK  AND  MEATS. 

The  devastation  of  a  large  part  of  the  live-stock  area  of  Europe, 
the  shortage  of  fodder1  and  the  resulting  increase  in  the  annual 
slaughter  combined,  in  spite  of  a  slight  increase  in  the  meat  pro- 
duction in  the  United  States,2  to  create  a  serious  world  shortage  of 
meats  and  fats.3 

1Mr.  Herbert  Hoover,  in  the  fall  of  1917  (Food  Adm.  Bull.  No.  10),  said  in  part: 
"  The  general  policy  of  European  nations  is  to  reduce  these  herds  by  slaughter  of  their 
animals  to  an  extent  far  beyond  their  annual  production.  It  is  obvious  that  the  number 
of  their  animals  which  it  is  necessary  to  support  by  imported  fodder  requires  shipping 
for  their  support  far  in  excess  of  the  tonnage  that,  would  be  required  to  import  equal 
amounts  of  animal  products.  Furthermore,  the  production  of  fodder  grains  in  Europe 
displaces,  to  a  considerable  extent,  their  possible  production  of  bread  grains." 

2  The  decrease  in  the  world's  supply  of  meat-producing  animals  suffered  during  the 
first  3  years  of  the  war  as  shown  in  Bulletin  No.  10,  U.  S.  F.  A.,  was  as  follows: 


Live  stock. 

Decrease  under  prewar 
normal  in- 

Total  ac- 
tual net 
decrease 
under  pre- 
war nor- 
mal. 

Western 
allies. 

Other 
countries, 
including 
enemies. 

Cattle      

8,  420,  000 
17,500,000 
7,100,000 

26,  750,  000 
34,000,000 
31,600,000 

28,  080,  000 
54,500,000 
32,425,000 

Sheep 

Hogs 

Total 

33,  020,  000 

92,350,000 

115,005,000 

3  The    French    official    live-stock    figures,    published    by    the    Food    Administration    on 
Aug.    3,    1917,   showed   that  their   supply   of  cattle  had   decreased   by    16.6   per   cent   as 


88  HISTORY   OF   PRICES   DURING   THE   WAR. 

For  more  than  a  year  the  Allies  had  been  taking  increasing  quan- 
tities of  meat  and  fats  from  the  United  States  and  already  our 
exports  of  fresh  and  pickled  beef  had  mounted  to  over  270,000,000 
pounds  for  the  year  ending  June  30,  1917,  or  an  increase  of  almost 
3,000  per  cent  over  the  prewar  average.  Similary,  our  exports  of 
bacon  and  ham  had  increased  some  640,000,000 -pounds  over  the  cor- 
responding prewar  yearly  average  of  303,489,000  pounds.  It  was 
apparent  that  these  large  demands  would  gradually  absorb  our 
domestic  supplies,  and,  indeed,  the  report  of  a  commission  appointed 
by  Mr.  Hoover  showed  that  such  was  fast  becoming  the  case  with 
our  herds  of  swine.1  But  in  spite  of  this  situation  it  was  necessary 
that  future  shipments  to  the  Allies  must  equal,  if  not  exceed,  those 
of  1916-17.  Accordingly,  two  methods  were  adopted  for  the  solu- 
tion of  the  meat  problem — conservation  through  decreased  consump- 
tion and  stimulated  production.  These  two  courses  of  action  guided 
the  entire  price  policy  of  the  Food  Administration  with  respect  to 
meat,  and  to  them  must  be  attributed  its  success  or  failure.  The 
task  of  stimulating  production  was  attempted  through  patriotic 
appeal  and  through  an  assured  return  to  the  producer.  It  is  with 
the  latter,  since  the  medium  of  its  realization  was  a  form  of  price 
control,  that  the  present  investigation  deals. 

The  stimulation  of  meat  production. — The  Food  Administration 
through  Mr.  Hoover,  and  the  Department  of  Agriculture  through 
Secretary  Houston,  in  a  statement  on  August  21,  1917,  urged  the 
farmers  of  the  United  States  to  increase  the  production  of  sheep, 
cows,  and  hogs,  assuring  them  at  the  same  time  "  a  fair  share  of  a 
fair  price  paid  by  the  consumer."  From  the  very  beginning,  how- 
ever, Mr.  Hoover  insisted  that  he  had  no  intention  of  fixing  the 
price  either  of  pork  or  beef,  but  that  he  hoped  to  increase  the  meat 
supply  by  stabilizing  the  industry  and  supporting  remunerative 
prices  to  the  farmer  through  purchases  of  beef  and  pork  for  export. 
The  consumer,  on  the  other  hand,  was  to  be  protected  by  the  elimi- 
nation of  speculative  profits  and  the  punishment  of  profiteering 
through  a  proposed  license  system. 

There  were  in  reality  two  quite  different  problems  to  be  solved, 
the  one  pertaining  to  beef  and  the  other  hog  production.  The  beef 

compared  with  1913,  sheep  by  33  per  cent,  and  hogs  by  38  per  cent.  These  decreases, 
by  the  autumn  of  1917,  had  increased  by  several  per  cent  in  the  case  both  of  sheep 
and  hogs.  The  amount  of  meat  passing  through  Smithfield  Market,  England's  greatest 
meat  distributing  center,  makrs  evident  the  extent  of  the  meat  shortage  in  England 
during  the  summer  of  1917.  The  total  receipts  for  July,  1917,  equaled  20,802  tons  as 
compared  with  23,954  tons  in  the  same  month  of  1916 ;  29,597  tons  in  1915 ;  and 
36,720  tons  in  1914.  These  data  show  a  decrease  of  43.3  per  cent  in  the  meat  there 
handled  in  July,  1917,  under  that  handled  in  July,  1914. 

1  The  reports  of  a  commission  to  investigate  the  cost  of  producing  hogs,  Meat  Divi- 
sion, United  States  Food  Administration,  1917,  states  that :  The  normal  number  of 
hogs  in  the  United  States  is  approximately  65,000,000  as  contrasted  with  the  present 
supply  of  not  more  than  60,000,000. 


GOVERNMENT   CONTROL   OVER   PRICES.  89 

problem  was  the  less  serious,  for  it  seemed  likely  Ithat  the  Allies 
could  support  themselves  by  further  encroachment  upon  their  herds. 
Future  contingencies  had  to  be  provided  for,  however,  since  it  was 
necessary  to  maintain  the  milk  herds  of  the  European  countries. 
Of  much  more  vital  consequence,  however,  was  the  question  of  hog 
supply.  Pork  at  the  time  played  a  tremendously  important  part  in 
the  food  supply  of  the  fighting  armies,  so  great,  in  fact,  that  it  was 
often  said  that  should  the  United  States  discontinue  pork  exports, 
"  the  German  line  would  be  moved  to  the  Atlantic  seaboard." 

Hog  production. — The  world  demand  for  fats  and  the  increasing 
consumption,  both  domestic  and  export,  made  the  pork  problem  one 
of  grave  concern  to  the  Food  Administration.  Yet,  the  ease  of  in- 
creasing production  afforded  hope  of  a  rapid  solution.  The  out- 
standing obstacle  during  the  summer  of  1917,  curiously,  was  the  lack 
of  confidence  among  producers  in  the  stability  of  market  prices.  It 
was  evident  that  the  farmers  of  the  country  would  have  to  be  assured 
that  their  efforts  toward  increased  hog  production  would  not  entail 
loss.  Accordingly,  a  commission  was  appointed  to  find  out  the 
actual  costs  of  producing  pork.  The  commission,  composed  of  lead- 
ing swine  producers,  investigated  various  phases  of  hog  production 
and  reported  their  results  to  Mr.  Hoover  on  October  27.  It  was  the 
opinion  of  the  commission  that  the  uncertainty  on  the  part  of  pro- 
ducers, caused  by  the  fluctuating  market  prices  of  live  hogs,  was 
leading  to  the  marketing  of  large  numbers  of  potential  breeding 
stock.  The  continuance  of  that  practice  would  obviously  bring  dis- 
astrous results.  The  commission  declared  it  imperative  to  stabilize 
the  market  immediately,  and  suggested  that  a  minimum  emergency 
price  be  established.  But  it  was  also  vital  to  stimulate  swine  pro- 
duction for  1917-18,  and  for  this  purpose  it  was  recommended 
that  a  price,  to  go  into  effect  on  February  1,  1918,  be  announced  for 
the  1918  litter.  This  price,  it  was  believed  should  be  based  upon  the 
price  of  corn.  Observations  had  shown  the  average  ration  of  corn  to 
hog  supply  to  be  about  12  bushels  of  corn  to  100  pounds  of  pork,  and 
that  as  the  ratio  varied  the  stock  of  hogs  in  the  country  increased  or 
fell  off.  It  was  mandatory,  therefore,  to  maintain  at  least  this  ratio 
if  a  hog  supply  equal  to  that  then  existing  was  to  be  maintained. 
Indeed,  the  commission  believed  that  in  order  to  bring  hog  produc- 
tion back  to  normal  a  ratio  of  13.3  to  1  would  be  necessary. 

Two  days  after  the  receipt  of  these  findings,  the  Meat  Division  of 
the  Food  Administration  was  created  in  Chicago  under  the  general 
direction  of  Mr.  John  P.  Cotton.  Acting  on  the  basis  of  the  above 
report,  he  checked  the  fall  in  prices  at  the  central  markets  by  declar- 
ing that  the  price  of  hogs  until  further  notice  would  not  "  go  below 
$15.50  per  hundredweight  for  the  average  of  the  packer's  droves  on 


90 


HISTORY   OF   PRICES   DURING   THE   WAR. 


the  Chicago  market."1  This  price  was  to  be  maintained  through 
the  control  which  the  Food  Administration  had  over  the  buying  of 
the  Allies,  the  Army,  the  Navy,  the  Red  Cross,  the  Belgian  relief, 
and  the  neutrals,2  which  together  constituted  a  considerable  factor 
on  the  market.  He  further  stated  that,  in  order  to  stimulate  the 
1918  hog  crop  and  bring  it  back  to  normal,  the  Food  Administration 
would  try  to  stabilize  that  price  so  that  the  farmer  could  "  count  on 
getting  for  each  100  pounds  of  hog  ready  for  the  market  13  times  the 
average  cost  per  bushel  of  the  corn  fed  into  the  hogs.'*1 

It  should  be  borne  in  mind  that  this  was  not  a  guaranty  on  the 
part  of  the  Food  Administration.  In  fact,  the  Food  Administra- 
tion had  no  financial  or  statutory  means  of  giving  such  a  guarantee. 
It  was  merely  a  statement  of  intention  and  policy. 

Close  surveillance  was  kept  by  the  Food  Administration  over  the 
market  after  November  3  and  methods  were  adopted  to  maintain 
prices  in  accordance  with  their  outlined  policy.  In  January,  1918, 
conditions  became  unfavorable.  Prices  had  fallen  to  $15.9T.3  It 
appeared  doubtful  whether  the  Food  Administration  would  be  able 
to  keep  the  market  up  to  the  $15.50  basis.  Accordingly,  the  Food 
Administration  exerted  all  efforts  toward  securing  orders  and  tided 
over  the  emergency.  Prices  for  February,  1918,  averaged  $16.55. 
There  follows  a  table  showing  the  average  actual  prices  of  corn, 
mixed,  cash  No.  3,  at  Chicago  from  January,  1913,  to  December,  1918, 
and  those  for  live  hogs,  bulk  of  sales : 

ACTUAL  AVERAGE  MONTHLY  PRICES  OF  CORN  AND  HOGS  AT  CHICAGO,  1913-1918.< 

CORN,   MIXED,   CASH  NO.  3. 

[Per  bushel.] 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January  ....        .                

$0.  4788 

$0.  6175 

$0.  7135 

$0.  7500 

$0.9850 

$1  5975 

February                                                 

.4891 

.6169 

.7325 

.7375 

.9950 

1  6750 

March     .     .           

.4945 

.6403 

.7160 

.7158 

1.  1243 

1  6375 

April                                                          

.5481 

.6678 

.7510 

.7417 

1.  4722 

1  5333 

May..              .      ..    .            

.5688 

.6930 

.7585 

.7500 

1.6466 

1  4500 

June                                             ..         .-- 

.6072 

.7244 

.7431 

.7157 

1.  6921 

4300 

July 

.6150 

.7060 

.7878 

.7757 

2.0478 

.5250 

.7385 

.8130 

.8013 

.8625 

1.7917 

6250 

.7472 

.7891 

.7431 

.8569 

2.0881 

535S 

.6950 

.7338 

.6246 

.9572 

1.9944 

2533 

November                                  

.7183 

.6863 

.6291 

.9728 

2.2500 

.2725 

December 

•  6647 

.6425 

.6575 

.9092 

1.5935 

4050 

>•  Nov.  3,  1917. 

2  See  statement  on  "  The  centralization  of  Government  and  Allied  food  purchasers  "  in 
the  latter  part  of  this  chapter. 

3  A  survey  of  hog  and  corn  prices  from  January,  1913,  to  December,  1918,  throws  con- 
siderable light  upon  the  conditions  in  the  pork  industry.     The  advance  in  the  price  of 
hogs  over   the   prewar  average   appears   at   first  glance   to    have   been   considerable.      It 
should  be  remembered,  however,  that  corn  is  the  chief  fodder  consumed  in  the  raising 
of  hogs  and  that  the   greater  part  of  the  cost  of  the  matured  animal   represents  corn 
costs.     Corn  prices  during  the  period  dealt  with  rose  from  a  prewar    (July   1,  1913,  to 
June  30,  1914)   average  of  $0.679  per  bushel  to  $1.597  per  bushel  in  January,  1918,  an 
increase   of  133  per  cent,   as  against  hog  prices  which   rose   from   $8.309  per  hundred- 
weight in  the  prewar  year  to  $15.975  per  hundredweight  in  January,   1918,  an  increase 
of  91  per  cent. 

4  Quotations  for  corn,  mixed,  cash  No.  3,  are  from  the  Daily  Trade  Bulletin,  and  those  for 
live  hogs  (bulk  of  sales)  from  the  Bureau  of  Crop  Estimates,  Department  of  Agriculture. 


GOVERNMENT   CONTROL   OVER   PRICES. 


91 


ACTUAL  AVERAGE  MONTHLY  PRICES  OF  CORN  AND  HOCS  AT  CHICAGO, 
1913-1918— Continued. 


1913-1918— Continued. 

LIVE  HOGS. 

[Bulk  of  sales.] 
[Per  100  pounds.] 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January  

87  4500 

$8  1750 

$6  8000 

$7  2500 

$10  8000 

$15  9750 

February 

8  1750 

8  5500 

6  6750 

8  2500 

12  4500 

16  5500 

March 

9  1250 

8  6000 

6  7250 

9  4500 

14  3250 

Ifi  ST'V* 

April... 

8  8250 

8  4750 

7  2000 

9  6250 

15  6750 

16  8500 

May.. 

8  5000 

8  2375 

7  4000 

9  9500 

15  9750 

16  7750 

June 

8  6000 

8  1000 

7  4000 

9  5750 

15  1500 

16  4250 

July  

9  0750 

9  0000 

7  1000 

9  7250 

15  2500 

17  6250 

August  . 

8  3750 

8  9000 

6  9250 

10  2250 

17  2500 

18  7500 

September 

8  3750 

8  5750 

7  3500 

10  6000 

18  2000 

19  3750 

October  

8  2000 

7  7750 

7  7250 

10  0500 

17  1250 

16  7500 

November  .  . 

7  8000 

7  6250 

6  G250 

9  5750 

16  9500 

16  6250 

December 

7  7500 

7  2000 

6  3500 

9  4250 

17  0500 

17  0000 

The  salutary  effects  of  controlled  purchases  were  apparent  through 
the  spring  and  summer  of  1918.  In  August,  however,  receipts  at  the 
packing  centers  began  to  decrease,  since  the  1918  hog  supply  was  late 
in  maturing.  The  immediate  consequence,  of  course,  was  a  rising  mar- 
ket, and  hog  prices  went  to  $18.75  in  August  and  $19.375  in  September. 
But  the  interests  of  the  consuming  public  demanded  a  limit  to  this 
upward  rise,  and  lest  it  go  beyond  bounds  the  Food  Administration 
once  more  assumed  control  of  the  market.  On  this  occasion  a  reversal 
of  the  method  used  in  the  early  months  of  the  year  was  applied,  and 
European  orders,  which  were  an  important  part  of  the  then  existing 
demand,  were  withheld. 

Meanwhile,  a  subcommittee,  the  national  agricultural  advisory 
board,  a  body  appointed  in  the  early  spring  by  Mr.  Hoover  and  Secre- 
tary Houston  to  supervise  live-stock  production,  had  been  considering 
methods  to  be  further  employed  by  the  Food  Administration  in  ad- 
ministering its  policy  of  controlling  hog  prices.  On  September  25 
this  committee  recommended  that  in  placing  orders  for  pork  products 
the  Food  Administration  require  the  packers  with  whom  such  orders 
were  placed  to  agree  to  a  definite  price  basis,  determined  in  advance 
from  month  to  month,  for  the  purchase  of  their  hogs,  and  that  orders 
be  based  upon  such  an  agreed  price  basis.  It  was  also  suggested  that 
the  Food  Administration  announce  its  intention  of  maintaining  a 
minimum  hog  price  of  at  least  $15.50  throughout  the  period  of  the  war. 
Both  recommendations  were  formulated  into  a  definite  policy  at  a 
meeting  of  the  Food  Administration  with  some  50  packers.1  The 
latter  agreed  to  maintain  through  the  varying  seasons,  as  far  as  pos- 
sible, a  $15.56  minimum  for  average  droves,  as  well  as  to  maintain 
the  October  price  on  a  basis  of  about  13  to  1,  or  an  average  of  approxi- 

1Oct.   4,    1918.  , 


92  HISTORY   OF   PRICES   DURING   THE   WAR. 

inately  $18.50.  Attempts  would  also  be  made,  they  agreed,  to  prevent 
fluctuations  of  more  than  50  cents  per  100  pounds  in  any  one  week. 

The  pork  situation  seemed  to  be  settled  and  producer  and  consumer 
had  been  provided  for  when  peace  talk  became  current.  The  fear  of 
cheap  Argentine  and  South  African  corn  resulted  in  a  considerable 
decline  in  corn  prices,1  which,  it  was  feared,  would  break  the  hog 
market.  Swine  producers,  anticipating  a  fall  in  price,  rushed  their 
stock  to  the  market  in  large  numbers,  which  action  in  itself  was  bound 
further  to  lower  hog  prices.  Thus,  while  the  supply  of  hogs  had  in- 
creased only  8  per  cent  over  the  supply  of  1917,  the  arrival  of  hogs  at 
the  seven  great  markets  during  the  first  three  weeks  of  October  was 
27  per  cent  larger  than  in  the  corresponding  month  of  the  previous 
year.  The  result,  of  course,  was  a  failure  to  maintain  the  price  basis 
agreed  upon  for  October.2 

The  continued  demands  of  the  Allies  and  the  prospective  post-war 
requirements  necessitated  immediate  remedying  of  the  situation  and 
a  new  basis  of  price  determination  was  decided  upon.  The  13  to  1 
standard  was  laid  aside,  and  packers  participating  in  Government 
orders  agreed  not  to  purchase  hogs,  during  November,  at  less  than 
a  daily  minimum  price  of  $17.50  per  100  pounds  for  the  average  of 
packers'  droves;  and  further  pledged  themselves  to  buy  no  hogs 
other  than  "throw-outs  " 3  at  less  than  $16.50.  But,  if  the  plan  was 
to  succeed,  it  was  necessary  to  take  measures  against  a  repetition  of 
the  experience  of  October.  Supervision  of  markets,  clearly,  and 
measures  looking  to  a  regulation  of  the  flow  of  hogs  in  accordance 
with  the  capacity  of  the  packing  houses  at  the  various  centers  were 
equally  essential.  The  execution  of  this  task  was  assigned  to  a  price- 
stabilization  committee,  composed  of  representatives  of  the  Food  Ad- 
ministration, Department  of  Agriculture,  hog  producers,  and  the 
packers.  This  committee  kept  closely  in  touch  with  the  hog  receipts 
at  the  various  important  markets  and,  through  a  system  of  embargoes 
and  car  allotments,  controlled  shipments.  Receipts  in  excess  of  the 
capacity  of  slaughtering  plants  and  the  overstocking  of  primary 
markets  were  prevented,  and  thus  the  likelihood  of  a  recurrence  of 
certain  earlier  difficulties  reduced. 

Hog  prices  continued  stable  at  about  $17.50  throughout  November, 
and  through  agreement  this  price  was  continued  through  December,4 
January,  and  February. 

1  See  preceding  table  for  corn  prices. 

2  The  influenza  epidemic  which  curtailed  pork  consumption,  and  temporarily   decreased 
the  labor  staff  of  the  packers  about  25  per  cent,  was  another  contributory  factor  in  this 
connection. 

3  "  Throw-outs  "  were  defined  as  pigs  under   130  pounds,   stags,   boars,"  thin   sows,   and 
skips. 

4  See  preceding  price  table. 


GOVERNMENT   CONTROL   OVER  PRICES.  93 

Beef  production. — The  regulations  pertaining  to  <!he  beef  supply, 
by  comparison  with  those  for  hog  control,  were  few  and  simple. 
Upon  the  advice  of  the  producers,  no  action  was  taken  to  stabilize 
beef  in  the  fall  of  1917,  when  the  first  investigations  were  made  in 
anticipation  of  stabilizing  hog  prices.  The  control  over  beef  prices 
was  exercised  almost  entirely  by  regulating  demand  and  supply, 
and  there  were  never  many  or  elaborate  agreements  dealing  with 
the  price  of  beef. 

The  military  and  allied  demands  for  beef  were  considerably 
smaller  than  those  for  pork,  and  they  were  not  sufficient  in  volume 
to  exert  more  than  a  temporary  influence  on  price.  It  was  there- 
fore impossible  to  apply  to  the  beef  market  the  same  method  of  con- 
trol that  characterized  pork  control.  Meatless  days  and  meatless 
meals  were  instituted  as  a  conservation  measure  at  various  times1 
and  seemed  to  effect  enormous  savings.  In  fact,  over  140,000,000 
pounds  of  beef  had  been  conserved  in  the  four  months  ending  Febru- 
ary 28,  1918.2  However,  the  rising  price  of  feed  stuffs  and  the  fall- 
ing tendency  in  the  price  of  steers  (the  latter  caused  in  part  by 
the  large  seasonal  flow  of  cattle  to  market)  brought  to  the  fore  the 
question  of  cattle  prices,  and  it  was  thought  that  measures  similar 
to  those  taken  in  the  case  of  hog  producers  would  have  to  be  applied 
to  cattle  raisers  and  feeders.  On  March  16  the  Food  Administra- 
tion announced  that  it  would  attempt  to  relieve  the  cattle  situation 
by  increasing  the  proportion  of  its  purchases  of  higher  grades  of 
beef.  In  early  March  the  daily  meatless  meal  request  was  with- 
drawn, and  the  only  restriction  asked  of  consumers  was  the  beefless 
and  porkless  Tuesday.  On  March  30,  the  meatless  day  was  entirely 
removed  3  for  a  period  of  30  days.  The  usual  seasonal  decline  in 
the  volume  of  animals  coming  to  market  began  in  early  May  and 
immediately  became  reflected  in  the  market  prices. 

1  The  meatless   day   was  inaugurated  on   Nov.    1,   1918.     Every  public  eating  place,  as 
well  as  all  families,  were  asked  to  pledge  themselves  to  eat  no  meat  on  one  day  each 
week.     On  Jan.  28,  1918,  President  Wilson  in  a  proclamation  asked  for  further  conserva- 
tion of  beef,  pork,  and  mutton,  and  requested  that  "  Tuesday  be  observed  as  meatless  day 
in  each  week,"  and  that  "  one  meatless  meal  be  observed  in  each  day." 

2  The  Food  Administration  on  Feb.  22,  1918,  in  outlining  the  results  of  conservation  in 
a  press  notice,  said  in  part : 

"  From  the  1st  of  November,  when  the  meatless  day  was  instituted,  to  the  end  of 
February  the  estimated  slaughter  of  cattle  in  the  United  States  will  amount  to  a  mini- 
mum of  3,800,000,000  pounds  of  beef.  The  export  of  beef  to  the  Allies  during  this  period 
will  reach  approximately  165,000,000  pounds.  *  *  *  The  stocks  of  beef  in  the  cold- 
storage  warehouses  will  be  approximately  the  same  at  the  end  of  February  that  they 
were  at  the  end  of  October.  *  *  The  average  prewar  exports  of  beef  for  4  months 

was   about  25,000,000  pounds,   and,   therefore,    the  amount  of  conservation    realized  has 
been,   roughly,    140,000,000   pounds." 

3  Since  the  ostensible  purpose  of  the  "  meatless  day  "  was  to  conserve  the  supply  and 
thereby  provide  sufficient  meat  for  the  Allies,  the  effect  of  such  meatless  days  upon  the 


94 


HISTORY   OF   PRICES   DURING   THE    WAR. 


Further  requests  for  conservation  and  economies  in  the  use  of 
meat  were  issued  by  the  Food  Administration.1  But,  in  spite  of 
economies,  the  war  demands  for  beef  remained  far  in  excess  of  our 
surplus.  The  Food  Administration  was  having  difficulty  in  securing 
for  overseas  shipments  the  grades  of  beef  most  economical  to  ship. 
It  was  found  necessary  to  reduce  somewhat  the  desired  weights  and 
to  postpone  certain  orders.  On  June  13,  further  economies  were 
asked  for,  and  several  requests  were  made  of  households  and  public 
eating  places  to  limit  the  weekly  consumption  of  beef  to  certain 
specified  amounts.  Droughts  in  the  Southwest,  in  Montana  and  ad- 
jacent States  two  months  later,  however,  and  the  accompanying 
large  runs  of  cattle  to  markets,  made  the  continuance  of  beef  con- 
servation impracticable,  and  on  August  15,  1918,  requests  for  the 
conservation  of  beef  were  rescinded.  The  public  was  then  asked 
to  purchase  cuts  from  light  weight  cattle,  since  these  were  being 

price  of  live  steers  is  of  interest.     The  prices  of  steers  at  Chicago   from   1913  to   1918 
follow.     Their  trend  from  October,  1917,  on  is  especially  significant. 

Prices  of  steers  at  Chicago,  1913-1918. 


1913 

1914 

1915 

1916 

1917 

1918 

Choice  to  prime: 
January                                        

$9.  0125 

$9.  2250 

$9.  1585 

$9.  4800 

$11.4100 

$13.  7688 

February                                  

8.  9125 

9.2250 

8.8938 

9.2913 

11.8628 

13.  7188 

March                                      

8.9400 

9.2650 

8.  6667 

9.6813 

12.  4500 

13.  8875 

April 

8.  8938 

9.  2750 

8.  3313 

9.  7375 

12.  9900 

16.0800 

May 

8.  6563 

9.  1250 

8.  6450 

10.0000 

13.  2438 

17.  4750 

June 

8.7800 

9.1600 

9.2688 

11.0063 

13.  3625 

17.8063 

July                                      

8.  9875 

9.  6750 

9.9063 

10.7000 

13.  5300 

18.  1438 

August  

8.8875 

10.  0300 

9.8100 

10.  5750 

14.3188 

18.6000 

September                           

9.  0750 

10.  5250 

9.  7313 

10.  8750 

16.  3375 

19.  2050 

October 

9.  1250 

10.  4500 

9.  6875 

10.  9650 

16.  5150 

19.  1750 

November                            

8.  9563 

10.  2188 

9.9400 

11.5125 

15.  6063 

19.  4875 

December 

8.9200 

9.7750 

9.  6875 

11.5250 

14.  2250 

19.  8350 

Good  to  choice: 
January 

8.  3563 

8.  7563 

8.  6333 

8,6650 

10.  5300 

13.1125 

February                                  

8.4063 

8.  6375 

8.  1750 

8.  4688 

11.1313 

13.0750 

March 

8.5600 

8.  6550 

8.2333 

8.9688 

11.8680 

13.  2313 

April                                      

8.5000 

8.  7125 

8.0313 

9.1188 

12.  3100 

15.  1750 

May 

8.2563 

8.  7250 

8.5900 

9.4600 

12.  4750 

16.  4167 

June                                   

8.4850 

8.7950 

8.9563 

10.  2625 

12.5500 

17.  1750 

July  

8.  7188 

9.  2168 

9.2125 

9.9850 

12.  5600 

17.  6250 

August                               

8.5063 

9.6200 

9.2300 

9.8500 

13.  1750 

17.8250 

September 

8.  6650 

9.  7313 

8.9500 

9.8000 

14.  9873 

18.  4100 

October  .                           

8.6500 

9.  4313 

8.8750 

9.  9050 

14.  6750 

17.  8563 

November 

8.  5063 

9.4063 

8.  8450 

10.  3500 

14.  3875 

18.  1563 

December                         

8.  4450 

8.9125 

8.  4875 

10.  2917 

13.2350 

18.  3600 

Native  beef: 
January                          

7-9250 

8.4700 

8.2400 

8.  4060 

10.  1500 

12.  0250 

Februarv 

8.0625 

8.  3125 

7.  5125 

8.2125 

10.  4375 

11.9625 

March    *                        

8.  2709 

8.  4375 

7.  7375 

8.7250 

11.0900 

12.  5400 

April 

8.2250 

8.5000 

7.6250 

9.0500 

11.7125 

14.7000 

May 

8.0200 

8.4300 

8.2000 

9.3625 

11.6833 

15.  4375 

June 

8.2333 

8.5625 

8.7625 

9.8000 

12.1000 

15.7500 

July                               

8.2125 

8.9250 

9.2500 

9.3760 

12.4000 

16.  0375 

August 

8.2400 

9.0100 

9.0625 

9.  4125 

12.  5125 

•  15.7600 

September                  

8.  4125 

9.3500 

8.9625 

9.5600 

13.  0700 

15.0500 

October 

8.4000 

9.0800 

8.8900 

9.6125 

11.7000 

14.3750 

November         

8.2600 

8.8333 

8.  7250 

10.  0075 

11.1375 

15.0200 

December 

8.  2125 

8.  4375 

8.4900 

lO.'HOO 

11.1167 

15.  0500 

1  On  May  3  a  statement  was  issued  to  the  effect  that  the  Pood  Administration  was  de- 
sirous of  securing  economy  in  the  consumption  of  all  kinds  of  meats  without  the  reinstal- 
lation  of  the  meatless  day.  The  public  was  asked  rigorously  to  eliminate  all  waste  and  to 
reduce  the  consumption  of  all  kinds  of  meats  and  poultry,  more  particularly  beef.  The 
substitution  of  milk  products  and  fish  was  urged. 


GOVERNMENT   CONTROL    OVER   PRICES.  95 

rushed  upon  the  market  from  the  dr ought -stricke*.  areas.1  From 
the  midsummer  of  1918,  on  to  the  signing  of  the  armistice,  no  regu- 
lations directly  affecting  the  price  of  live  cattle  were  put  into  effect, 
On  August  16,  to  be  sure,  the  Food  Administration  announced  a 
series  of  prices  which  it  would  pay  for  beef,  September  delivery, 
such  prices  to  vary  in  accordance  with  the  weights  of  dressed  steers. 
But  it  appears  that  this  plan  proved  impracticable,  for  four  weeks 
later  the  method  of  purchasing  beef  was  changed,  and  a  new  plan 
of  purchasing  beef  on  a  basis  of  quality  irrespective  of  weight  was 
adopted. 

The  licensing  of  the  meat  industry. — Although  the  main  instru- 
ment of  price  control  over  beef  and  pork  was  the  regulation  of  the 
markets  through  purchases  by  the  Food  Administration,  the  regu- 
lation of  profits  and  the  general  supervision  over  the  activities  of 
the  packing  industry  was  attained  through  the  licensing  system.  Be- 
fore availing  itself  of  the  license  privilege  the  Food  Administration 
called  upon  the  packers  for  opinions  and  suggestions  relative  to  the 
ways  and  means  of  control.  The  idea  of  placing  the  packing  in- 
dustry under  license  appears  to  have  been  generally  approved,  and 
on  November  1,  1917,  in  accordance  with  President  Wilson's  procla- 
mation of  October  8  previous,  the  packing  industry  (i.  e.,  "  importers, 
producers,  and  packers  of  fresh,  canned,  or  cured  beef,  pork,  or  mut- 
ton ")  became  subject  to  license  by  the  Food  Administration. 

Specific  exception,  however,  was  made  of  packers  whose  gross  sales 
were  less  than  $100,000  per  year.  The  latter  were  provided  for,  in 
part,  under  the  license  requirements  for  producers  of  lard  and  cook- 
ing fats 2  and  by  subsequent  proclamations  which  included  operators 
of  stockyards,3  dealers  in  "live  or  dead  cattle,  sheep,  swine,  or 
goats,"  4  and  distributors  and  producers  of  animal  fats  and  oils,  and 
casings  for  sausages.5 

The  purpose  of  the  licensing  system  was  to  reduce  the  cost  of  dis- 
tribution from  producer  to  consumer  and  to  eliminate  profiteering, 
and  the  general  method  of  attaining  this  end  was  the  prescribing 
of  certain  fixed  margins  of  profit  over  cost.  The  packing  industry, 
however,  because  of  its  complicated  ramifications  and  the  variety  of 
by-products,  was  not  readily  amenable  to  this  form  of  regulation, 
and  other  means  soon  were  necessary  for  its  control. 

In  determining  the  methods  of  regulation  applicable,  the  pack- 
ing industry  divides  itself  naturally  into  three  parts — the  five  great 

1  Compare  the  price  tendency  of  "  native  beef  steers,  carload  lots,"  in  which  the  bulk 
of  light  weight  cattle  is  included,  with  the  price  tendency  of  "  heavy  "  and  "  corn  fed  " 
steers  for  July,  August,  and  September. 

2  See  presidential  proclamation  of  Oct.  8,  1917. 

3  See  presidential  proclamation  of  June  18,  1918. 

4  See  presidential  proclamation  of  Sept.  6,  1918. 
BSee  presidential  proclamation  of  Nov.  2,  1918. 


96  HISTORY   OF   PRICES   DURING   THE   WAR. 

packers  whose  individual  annual  sales  exceed  $100,000,000;  a  con- 
siderable number  of  smaller  packers  whose  sales  each  year  are  more 
than  $100,000;  and,  finally,  packers  whose  annual  business  amounted 
to  less  than  $100,000. 

Immediately  after  the  establishment  of  the  Meat  Division  of  the 
Food  Administration,  regulations  for  the  control  of  the  meat  indus- 
try were  formulated.  The  outstanding  feature  of  these  regulations 
was  the  limitation  upon  profits  which  was  partly  made  by  fixing 
the  return  allowable  on  the  capital  invested  in  the  case  of  the  larger 
packers,  and  partly  by  prescribing  a  maximum  return  on  gross  sales 
in  the  case  of  the  smaller. 

Licensees  with  annual  sales  exceeding  $100,000*000. — So  many  and 
diverse  are  the  activities  of  the  modern,  large  packing  plants  that 
the  industry  may  be  said  to  consist  of  independent  units  which  have 
little  connection  with  each  other.  Many  of  the  by-products,  indeed, 
bear  little  relation  to  slaughtered  live  stock.  Then  there  are  con- 
nected with  the  packing  industry  such  activities  as  the  making  of 
cartons  and  advertising  materials  which  commonly  comprise  indi- 
vidual business  units  in  themselves ;  as  well  as  banks,  stockyards,  and 
the  like,  all  of  which  to-day  play  an  important  part  in  plant  opera- 
tion. It  was  therefore  necessary  for  the  Food  Administration  arbi- 
trarily to  separate  the  industry  into  individual  units  for  licensing 
purposes.  Three  divisions  were  made  and  different  regulations  pro- 
mulgated for  each. 

Those  activities  directly  connected  with  and  incidental  to  the 
slaughtering  of  live  stock  and  the  products  of  slaughtered  animals, 
as  well  as  the  preservation  and  shipping  of  meat  products,  were  placed 
in  class  I,  and  profits  from  these  activities  limited  to  9  per  cent  of 
the  investment  (including  borrowed  capital)  per  year,  representing 
substantially  the  prewar  returns.1 

A  second  class  was  made  up  of  those  branches  of  the  packing  in- 
dustry which  had  to  do  with  products  (food  or  otherwise)  which  con- 
tained either  in  value  or  bulk  few  or  no  materials  derived  from 
slaughtered  live  stock.  Highly  fabricated  by-products  were  also  in- 
cluded in  this  class,  and  the  annual  profits  were  fixed  at  a  maximum 
of  15  per  cent  of  the  investment.  The  raising,  fattening,  and  feeding 

1  Immediately  following  the  issuance  of  these  regulations,  a  protest  was  made  by  the 
5  large  packers,  their  contention  being  that  a  maximum  profit  of  9  per  cent  might  limit 
their  borrowing  capacity.  They  also  stated  that  such  a  profit  would  not  yield  them 
sufficient  to  pay  for  the  necessary  expansion  of  plant  and  equipment  and  that  no  new 
capital  would  be  found  for  this  purpose  during  the  war.  Mr.  Hoover  appears  to  have 
allayed  these  fears  by  his  statement  that  there  could  be  no  lack  of  confidence  on  the  part 
of  the  banking  community  in  the  packer's  earning  capacity,  especially  since  the  export 
demand  for  their  product  was  larger  than  the  country's  supply.  He  also  said  that  if  the 
packers  "  exhausted  their  abilities  to  find  capital  and  exhausted  their  abilities  for  coiv 
struction  out  of  their  earnings,  and  that  if  the  Government  required  specific  extensions  of 
plant  to  meet  war  needs,  these  would  be  considered  upon  their  merits  from  time  to  time." 


GOVERNMENT    CONTROL   OVER   PRICES.  97 

of  live  stock;  slaughtering  and  packing  in  foreign  countries;  the 
operation  of  banks  and  loan  institutions  dealing  in  futures;  and  in- 
vestments in  concerns  not  formerly  treated  as  a  department  of  a  pack- 
ing enterprise,  however,  were  specifically  exempted  from  the  profit 
limitations. 

Certain  principles  were  applied  to  the  determination  of  profits  and 
investment.  The  latter  was  defined  to  include  only  those  investments 
owned  by  the  licensee  and  actually  and  necessarily  used  in  his  business, 
and  was  to  consist  of  the  actual  investment  in  land,  buildings,  and 
equipment,  the  value  of  stocks  held,  and  other  especially  designated 
factors.  The  same  methods  used  in  determining  investment  values  in 
the  year  ending  November  1, 1917,  were  to  be  applied  to  future  valua- 
tions. The  latter  principle  was  also  to  be  applied  to  the  determina- 
tion of  profits  during  1917-18,  and  provisions  were  made  for  deprecia- 
tion of  plants,  repairs,  and  other  items.  It  is  significant  that  a 
special  rule  was  incorporated  prohibiting  unreasonably  large  salaries 
or  other  compensations. 

Licensees  were  required  to  close  their  books  at  least  once  in  10 
weeks  and  report  to  the  Food  Administration  any  information  re- 
quested by  the  Meat  Division  relative  to  investments,  sales,  and 
profits.  In  this  way  the  Food  Administration  was  enabled  to  watch 
closely  the  returns  of  the  individual  packers,  and  in  order  that 
reports  might  be  verified,  the  individual  licensees  were  compelled 
to  give  to  representatives  of  the  Meat  Division  access  to  all  records 
and  accounts.  The  Food  Administration,  however,  was  not  con- 
tent 'to  rest  even  with  this  check.  In  order  that  every  part  of  an 
individual  packer's  business  might  be  supervised,  it  further  required 
that  it  be  given  access  to  the  books  and  records  of  every  corporation, 
quite  irrespective  of  the  nature  of  its  business,  in  which  a  licensee  held 
half  or  more  of  the  capital  stock. 

Licensees  with  annual  sales  of  less  than  $100 ,000 ,000. — The  greater 
part  of  the  licensed  packers  came  within  this  category.  Since  there 
were  not  so  many  diversifications  in  these  smaller  plants,  it  was  not 
deemed  necessary  to  make  the  distinctions  between  various  branches 
as  was  the  case  with  the  larger  plants.  Accordingly,  the  aggregate 
business  of  the  licensee  was  taken  as  a  unit  and  a  maximum  profit 
equal  to  2J  per  cent  of  the  gross  value  of  sales  was  prescribed. 
Those  activities,  however,  which  were  exempted  from  profit  limita- 
tions as  applied  to  the  larger  packers,  as  well  as  the  operation  of  in- 
dependent retail  stores  or  markets,  were  to  be  excluded  in  comput- 
ing sales.  Accounting  methods  were  regulated  in  a  manner  similar 
to  those  of  the  larger  packers. 

The  administration  of  the*  license  system  over  meat. — The  inaugu- 
ration of  the  license  system  did  not  remedy  the  many  difficulties  con- 

125547°— 20 7 


98  HISTORY   OF   PRICES   DURING   THE   WAR. 

fronting  the  Food  Administration.  The  demands  of  the  fighting 
forces  were  Continually  growing  and,  although  the  interests  of  the 
live-stock  producers  were  under  constant  survey  of  the  Meat  Division, 
it  was  evident  that  many  of  the  measures  of  the  administration  were 
"  developing  discontent  and  criticism  in  sections  of  the  producing 
community."1  Conditions  had  come  to  such  a  pass,  in  fact,  that  it 
was  thought  necessary  to  "  study  the  entire  situation  in  regard  to  the 
meat  industry  and  the  steps  that  should  be  taken  in  regard  thereto."  l 
On  April  1,  at  the  request  of  Mr.  Hoover,  a  committee  was  appointed 
to  determine  a  war  policy  respecting  the  meat  industry. 

An  investigation  of  the  situation  resulted  in  no  radical  changes  in 
administration.  The  continuation  of  regulations  was  recommended, 
as  well  as  the  bi-monthly  auditing  of  the  packers'  profit  returns,  and 
the  installation  of  uniform  accounting  methods  by  the  Federal  Trade 
Commission  which  had  already  been  started.  It  was  suggested  that 
such  maximum  profit  regulations  as  were  then  in  effect  should  be 
continued  until  July  1,  and  that  the  Federal  Trade  Commission 
report  upon  the  reasonableness  of  these  maxima  in  the  meantime. 
The  packers,  they  recommended,  should  report  to  the  Department  of 
Agriculture,  for  publication  in  the  market  reports,  the  wholesale 
prices  received  for  meat  products  and  the  transfer  value  of  the  prin- 
cipal by-products  of  their  meat  departments. 

Among  other  plans  suggested  by  the  committee  was  the  extension 
of  the  activities  of  the  food  purchase  board,  looking  to  a  coordination 
of  all  official  purchases  of  packing-house  products.  Such  purchases 
ought,  it  was  said,  be  made  at  prices  sufficient  to  insure  production 
and  should  be  applied  likewise  to  purchases  of  the  public.  The  com- 
mittee recommended,  too,  an  investigation  of  the  retail  end  of  meat 
distribution  and  the  control  of  refrigerator  cars  by  the  Railroad 
Administration. 

The  most  important  actual  departure  resulting  from  this  investi- 
gation of  the  packing  industry  was  the  licensing  of  the  stockyards. 
A  presidential  proclamation  of  June  18,  1918,  required  all  operators 
of  stockyards,  all  buyers,  traders,  and  others  who  operated  in  connec- 
tion with  stockyards  "to  secure  licenses  on  or  before  July  25,  1918." 
The  supervision  and  regulation  of  these  licensees  were  placed  in  the 
hands  of  the  Department  of  Agriculture.  A  system  of  animal  grad- 
ing was  immediately  put  into  effect,  and  licensees  were  required  to 
make  daily  reports  of  the  distribution  and  destination  of  live  stock, 
meats,  and  other  products  from  the  principal  packing  points. 

The  licensing  in  September  of  dealers  in  live  or  dead  meat  animals 
brought  the  meat  industry  under  still  further  control.  Four  days 

1  See  Mr.  Hoover's  letter  to  President  Wilson,  Mar.  26,  1918. 


GOVERNMENT    CONTROL   OVER   PRICES. 


99 


after  the  signing  of  the  armistice  manufacturers  and  distributors  of 
sausage  casings  were  licensed,  and  that  regulatory  measure  was  the 
final  one  imposed  upon  the  packing  industry,  though  it  was  also  the 
first  to  be  withdrawn.1 

The  results  of  -meat  control. — American  exports  of  beef  prior  to 
1915  had  reached  their  high  point  in  1906  and  were  of  little  conse- 
quence generally.  Indeed,  from  1906  on  beef  shipments  to  Europe 
declined,  and  by  the  fiscal  year  1911  they  had  virtually  terminated.2 
With  the  opening  of  the  World  War  and  the  tremendous  loss  of  other 
shipping  American  exports  to  Europe  experienced  a  phenomenal  rise, 
and  the  12  months  ending  June,  1915,  witnessed  an  increase  of  2,700 
per  cent  over  the  exports  of  the  previous  fiscal  year.  With  the  en- 
trance of  the  United  States  into  the  ranks  of  the  belligerents  there 
was  a  still  further  increase  in  exports,  which  in  the  fiscal  year  1918 
reached  467,873,000  pounds.3 

Pork  exports,  likewise  in  large  demand  by  our  European  Allies,  also 
increased  considerably  during  the  period  of  the  war,  and  shipments 
in  1918  were  about  360  per  cent  larger  than  those  of  1914.4  This 
increase,  indeed,  is  evidence  of  the  Food  Administration's  success  in 
its  attempts  to  enlarge  shipments  of  pork  to  the  Allies.  It  is  signifi- 
cant to  note,  despite  the  enormous  increase  in  exports,  that  the  hogs 
reported  in  the  United  States  on  January  1,  1919,  numbered 
75,587,000  as  against  70,978,000  on  the  same  date  in  1918,  and 

1  These  licenses  expired  on  Jan.   10,   1910. 

2  Exports  to  Europe  of  canned,  fresh,  pickled,  and  cured  beef  in  the  fiscal  year  ending 
June,    1906,    equaled    413,865,267    pounds.      By    1912    they    had    dwindled    to    34,949,787 
pounds,  and  in  1914  they  were  only  9,511,914  pounds. 

3  The  trend  of  beef  exports  is  presented  in  the  following  table  of  shipments  to  Europe 
for  the  fiscal  years  1915—1918.     Data  from  the  Bureau  of  Foreign  and  Domestic   Com- 
merce, United  States  Department  of  Commerce  : 

United  States  export*  of  canned,  fresh,  pickled,  and  cured  beef  to  Europe,  1915-1918. 
Fiscal  year  :  Pounds. 

1914-15 257,  121,  000 

1915-16 284,  797,  000 

1916-17 271,  194,  000 

1917-18 467,  873,  000 

<  Below  are  presented  the  Department  of  Commerce  figures  showing  exports  of  bacon,  hams,  and  shoul- 
ders for  the  5  years  ending  June,  1918.  Although  the  relative  increase  for  1918  shipments  as  compared  to 
1914  is  considerably  smaller  than  in  the  case  of  beef,  the  actual  increase  in  pounds  is  much  greater,  some 
725,000,000  more  pounds  having  been  shipped  in  1918  than  in  1914. 

United  States  exports  of  hog  products  to  Europe,  1914-1018. 


Product. 

1913-14 

1914-15 

191-5-16 

1916-17 

1917-18 

Bacon                          .       ... 

Pounds. 
166,917,000 

Pounds. 
321,820,000 

Pounds. 
524,379.000 

Pounds. 
531,265,000 

Pounds. 
750,  879,  000 

Hams  and  shoulders 

150,  717  000 

191  110  000 

262  878,000 

245  328,000 

392  000  000 

Total 

317,634,000 

512,  930,  000 

787,  257,  000 

776,593,000 

1,142,879,000 

100 


HISTORY   OF   PRICES   DURING   THE   WAR. 


67,503,000  in  January,  1917,  while  the  hogs  marketed  in  the  year 
1918  numbered  69,854,700  as  compared  with  57,483,800  in  1917.* 

The  beef  situation,  in  like  manner,  appears  to  have  been  radically 
changed  during  the  past  three  years.  The  number  of  cattle  slaugh- 
tered in  1918  totaled  approximately  2,000,000  more  than  in  1917, 
representing  a  net  increase  of  about  1,000,000,000  pounds  of  beef, 
while,  at  the  same  time,  there  were  in  the  United  States  on  January 
1,  1919,  more  cattle  than  at  any  other  time  in  the  history  of  Ameri- 
can agriculture.2 

With  the  rescinding  of  the  export  regulations  of  the  War  Trade 
Board,  pertaining  to  shipments  of  meat,  in  March,  1919,  and  the 
consequent  opening  of  foreign  markets  to  individual  packers,  the 
price  agreements  relative  to  hogs  automatically  went  out  of  existence. 
The  control  of  the  market  through  purchases  by  the  Food  Adminis- 
tration was  considerably  diminished,  with  a  resultant  inability  to 
keep  up  hog  prices.  Later  events,  however,  showed  price  agree- 
ments to  be  no  longer  necessary,  for  within  seven  weeks  after  the 
removal  of  the  embargo  on  private  shipments  the  price  of  hogs 
reached  $21.15  per  100  pounds,-  the  highest  price  ever  known. 

On  April  1,  1919,  importers,  manufacturers,  storers,  and  distribu- 
tors of  beef,  pork,  mutton,  or  lard  were  released  from  license  re- 
quirements by  Presidential  proclamation,  and  the  packing  industry 
was  freed  from  war-time  control  by  the  Food  Administration. 

1  A  detailed  statistical  review  of  the  hog  supply  in  the  United  States  as  of  Jan.  1,  from  1910  to  1919,  is 
presented  in  the  following  table,  prepared  by  the  Bureau  of  Crop  Estimates,  U.  S.  Department  of  Agri- 


culture. 


Hogs  in  the  United  States,  1910-1919. 


Year. 

Total  num- 
ber. 

Per  cent 
of  preced- 
ing year. 

Year. 

Total  num- 
ber. 

Per  cent 
of  preced- 
ing year. 

Jan.  1,1910... 

*58,  186,  000 

Jan.  1,1915  

64,618,000 

109.6 

Jan  1   1911 

65  620  000 

112  8 

Jan  1   1916 

67  766  000 

104  9 

Jan.  1   1912 

65  410  000 

99.7 

Jan.  1,1917     .          .  . 

67,503,000 

99.6 

Jan  1    1913 

61  178  000 

93  5 

Jan  1   1918 

70  978  000 

105  1 

Jan.  I,  1914 

58  933  000 

96.3 

Jan.  1,1919     

75,  587;  000 

106.5 

*Census  Report  of  Numbers,  Apr.  15, 1910. 

2  The  number  of  cattle,  excluding  milch  cows,  in  the  United  States  at  the  first  of  the  year,  from  1910  to 
1919,  are  presented  below.    (Data  from  Bureau  of  Crop  Estimates.) 

Cattle  other  than  milch  cows  in  the  United  States,  1910-1919. 


Year. 

Total  num- 
ber. 

Per  cent 
of  preced- 
ing year. 

Year. 

Total  num- 
ber. 

Per  cent 
of  preced- 
ing year. 

Jan.1,1910  
Jan.  1,1911     ..  . 

*41,178,000 
39  679  000 

96"  4 

Jan.    ,1915  

Jan.      1916     . 

37,067,000 
39  812  000 

103.4 
107.4 

Jan  1  1912 

37  260  000 

93  9 

Jan       1917 

41  689  000 

104.  7 

Jan.  1,1913     ... 

36  030  000 

96.7 

Jan.      1918 

44.112  000 

105.8 

Jan.  1,1914     . 

35  855  000 

99  5 

Jan       1919 

44  399  000 

100.7 

*Census  Report  of  Numbers,  Apr.  15, 1910. 


GOVERNMENT    CONTROL   OVER   PRICES.  101 

.V, 

POTJLTEY    AND     DAIRY    PnODVt    IS. 

The  problem  which  faced  the  Food  Administration  in  regard  to 
poultry  and  dairy  products  was  one  of  profit  control  strictly,  and 
no  definite  price-fixing  was  adopted  throughout  the  period  of  the 
Food  Administration  operation. 

Poultry. — The  perishable  nature  of  fresh  poultry  made  it  virtu- 
ally impossible  to  enforce  any  concrete  price  regulation.  The  greater 
part  of  the  efforts  of  Food  Administration  was  directed  toward 
the  prevention  of  hoarding  and  intertrading  and  to  the  elimination 
of  all  possible  waste.  Thus  the  early  rules  related  to  methods  of 
shipping  and  feeding  poultry,  and  specific  regulations  were  issued 
as  to  methods  of  marketing.  Licensees  were  instructed,  for  example, 
to  keep  their  poultry  moving  to  the  consumer  in  as  direct  a  man- 
ner as  possible,  and  no  resales  were  allowed  within  a  given  branch 
of  the  industry  unless  made  at  a  price  which  was  less  than  or  equal  to 
the  initial  cost  to  the  seller.1  Four  classes  of  dealers  in  fresh  poultry 
were  recognized  and  only  those  sales  were  permitted  which  resulted 
in  poultry  following  the  normal  movement  from  producer  to  con- 
sumer.2 

The  attractive  market  prices  for  poultry  early  in  1918,  as  well  as 
the  high  cost  of  feed  stuff,  were  persuading  many  poultry  raisers  to 
sell  fowl,  which,  if  kept,  would  have  added  to  the  spring  and  summer 
egg  production.  The  idea  of  the  Food  Administration,  however,  was 
to  keep  on  the  farms  those  birds  which  would  be  egg  layers  i-n  the 
months  to  follow,  thereby  increasing  the  production  of  eggs.  In  this 
way  the  available  market  supply  could  be  enlarged  and  at  the  same 
time  more  eggs  would  go  into  storage  during  the  season  of  high  pro- 
duction at  a  price  which  would  not  necessitate  unreasonable  figures 
during  the  fall  and  winter.  Accordingly,  on  February  11,  1918,  an 
order  of  the  Food  Administration  forbade  licensees  to  ship,  sell,  or 
negotiate  the  sale  of  any  live  or  freshly  killed  hens  or  pullets  until 
April  30, 1918.  The  weather  conditions  of  March  and  April  brought 
about  an  early  laying  and  hatching  period,  and  by  the  middle  of 
April  the  Food  Administration  lifted  its  restriction.  It  is  estimated 
that  at  least  3,000,000  hens  were  saved  in  the  New  York,  Chicago,  and 
Boston  markets  alone. 

The  nature  of  the  frozen-poultry  industry  allowed  a  much  fuller 
control  than  was  possible  with  fresh  poultry,  and  there  was  accord- 

1  For  a  limited  period  sales  between  wholesalers  in  different  cities  were  permitted  at 
an  advance  of  5  per  cent  when  such  sales  were  necessary  to  supply  the  reasonable  require- 
ments of  the  buyer's  business.  In  some  cases  1  sale  between  dealers  in  the  same  branch 
of  the  trade  was  allowed,  but  more  than  1  sale  could  not  be  made  without  the  consent  of 
the  local  food  administrator. 

-  The  classes  so  recognized  were  :  Original  packers  and  shippers,  commission  merchants 
and  wholesalers,  jobbers  and  suppliers  of  hotels  and  institutions,  and  retailers. 


102 


HISTORY   OF   PRICES   DURING   THE   WAR. 


inglyina'uguratecVa  fairly  complete  set  of  rules  limiting  the  profits  of 
the  individual  classes  of  distributors.  The  marketing  of  the  fresh 
poultry  which  goes  into  the  cold-storage  warehouse  is  a  highly  sea- 
sonal affair,  and  the  fowl  producer  was  beyond  the  reach  of  the  Food 
Administrator.  It  was,  therefore,  impossible  to  fix  the  price  that 
the  packer  should  pay  for  his  poultry,  and  consequently  the  price 
which  he  should  charge  could  not  be  fixed. 

A  maximum  of  6  per  cent  was  fixed  as  the  advance  over  cost  to  be 
allowed  to  packers  on  sales  of  frozen  poultry.  This  margin,  how- 
ever, applied  only  to  regular  sales  within  the  trade — that  is,  sales 
to  commission  merchants,  wholesalers,  or  jobbers.  Many  packers  sell 
directly  to  retailers  and  to  hotels,  and  in  that  way  save  the  charges 
of  middlemen.  In  recognition  of  the  economic  advantage  of  elimi- 
nating middlemen  wherever  possible,  an  additional  advance  of  10 
per  cent  over  the  6  per  cent  maximum  mentioned  above  was  allowed 
to  packers  who  sold  directly  to  retailers.  To  those  who  sold  directly 
to  hotels  and  institutions  an  additional  advance  of  15  per  cent  was 
permitted.1 

The  return  to  commission  merchants  was  limited  to  5  per  cent,  as 
was  also  the  case  with  wholesalers.  However,  in  those  cases  where 
wholesalers  also  sold  as  jobbers,  they  were  allowed  a  profit  of  10  per 
cent  over  cost.  Jobbers  were  permitted  to  sell  their  poultry  at  an 
advance  of  10  per  cent;  and  for  suppliers  of  hotels  and  institutions 
there  was  set  a  maximum  of  15  per  cent.2 

Eggs. — The  regulations  relating  to  cold-storage  eggs,  as  with  fresh 
eggs  and  fresh  poultry,  were  similar  to  those  for  frozen  poultry.  The 
industry  was  divided  into  four  parts  and  restrictions  were  enforced 
relative  to  intertrading,3  and  a  maximum  return  was  prescribed  on 
the  sales  of  each  branch.4 

1  The  regulations  as  first  issued  said  nothing  as  to  extra  margins  allowed  packers  who 
sold  directly  to  jobbers  or  to  suppliers  of  hotels  and  institutions.     An  amendment  of  July 
26,  1918,  fixed  the  extra  advance  at  5  per  cent,  thus  making  the  total  return  to  packers 
who  eliminated  commission  merchants  or  wholesalers  in  their  transactions  equal  to  11 
per  cent. 

2  The  organization  of  the  trade,   it  is  elsewhere  shown,   is  such   that   poultry   usually 
passes  through  four  hands — (1)  packers  who  sell  to  (2)  commission  merchants  or  whole- 
salers, who  in  turn  dispose  of  their  products  to    (3)    jobbers  or  suppliers  of  hotels  and 
institutions,  and   (4)    retailers  and  hotels  and  institutions.     Upon  adding  up  the  various 
returns  allowed  the  individual  branches  of  the  trade,  the  total  advance  over  the  6  per 
cent  allowed  the  original  packer  amounted  by  the  time  frozen  poultry  reached  the  hands 
of  the  retailer,  to  15  per  cent ;  that  is,  5  per  cent  to  wholesalers  or  commission  merchants 
and   10   per  cent   to  jobbers.      Packers  selling  directly  to   retailers,   however,   were   only 
allowed  an  extra  advance  of  10  per  cent,  thereby  saving  5  per  cent  in  distributive  costs. 
Similarly,  when  poultry  went  directly  into  the  hands  of  suppliers  of  hotels  and  institu- 
tions a  saving  of  5  per  cent  was  realized,  the  cost  of  distributing  through  the  various 
hands  being  20  per  cent,  as  against  15  per  cent  when  sold  by  the  packer  direct  to  hotels, 
etc. 

3An  advance  of  4  per  cent  was  allowed  on  sales  within  the  same  branch  of  the  trade, 
but  such  sales  were  limited  to  one  in  number  for  any  lot  of  eggs.  Local  Federal  food 
administrators  had  to  be  informed  of  such  sales,  as  was  also  true  of  poultry. 

4  Original  packers  storing  in  cold-storage  warehouses  were  allowed  a  profit  of  0  per 
cent  over  cost.  When  packers  sold  to  retailers,  an  additional  advance  of  5  per  cent  over 


GOVERNMENT    CONTROL   OVER   PRICES.  103 

Unlike  the  poultry  regulations,  however,  provision  was  made  for 
limiting  the  profits  of  licensed  retailers,  to  whom  were  allowed 
maximum  returns  on  candled  and  selected  eggs  of  15  per  cent.  This 
maximum  was  later  changed  by  the  Retail  Section  of  the  Distribution 
of  Perishables  to  the  definite  sum  of  7  cents  for  cash-and-carry  stores 
and  8  cents  for  credit-and-delivery  stores,  and  any  advance  over  cost 
in  excess  of  this  amount  was  considered  as  a  violation  of  the 
reasonable-advance-over-cost  rule. 

Butter. — The  demand  for  fats  in  the  war  program  led  to  the 
inclusion  in  the  food-license  proclamation  of  October  8,  1917,  of 
manufacturers,  dealers,  brokers,  and  commission  merchants  in  but- 
ter. The  price  of  butter  had  previously  shown  no  extraordinary 
fluctuation ; x  indeed,  the  price  level  of  butter  had  risen  more  slowly 
than  that  of  commodities  in  general.  The  primary  aim  of  the  Food 
Administration  in  this  control,  appears  to  have  been  the  elimination 
of  profiteering,  since  the  regulations  related  in  some  way  or  other 
to  the  limiting  of  distributors'  margins  only.  The  costs  of  butter 
are  so  variable  as  to  make  impracticable  any  definite  system  of  price 
regulation.  In  one  instance,  however,  the  price  of  butter  was  defi- 
nitely fixed  for  a  short  while.  Butter  prices  have  a  tendency  to  rise 
during  the  early  winter  months,  and  it  was  the  desire  of  the  food 
authorities  to  check,  if  possible,  the  usual  rise  during  the  emergency 
period. 

On  January  22,  1918,  a  scale  of  wholesale  prices  was  established 
with  the  voluntary  cooperation  of  the  butter  trade,  and  butter  was 
fixed  at  47  cents  a  pound  at  New  York.  At  Chicago  a  price  of  45  J 
cents  was  established  for  the  last  quarter  of  January,  with  the 
provision  that  beginning  on  February  1  the  price  be  advanced  one- 
fourth  cent  per  pound  on  the  1st  and  15th  of  each  month  until  all  the 
creamery  butter  then  in  storage  should  be  released.  These  prices 
were  but  temporary  and  were  enforced  only  for  a  period  of  several 
months,  the  time  required  for  the  release  of  the  butter  then  in  storage.2 

For  the  purpose  of  enforcing  the  various  regulations,  butter  was 
classified  as  fresh  and  cold  storage,  the  latter  term  being  applied  to 

cost  could  be  charged  if  eggs  were  sold  in  original  packages.  If  however,  such  eggs  were 
candled  before  being  sold,  an  additional  advance  of  10  per  cent  of  cost  was  permitted.  In 
soiling  candled  eggs  the  actual  net  candling  loss  could  be  included  in  the  cost,  but  the 
expense  of  labor  and  materials  in  candling  and  all  repacking  charges  had  to  be  omitted. 
Likewise  an  additional  12  per  cent  could  be  charged  on  sales  to  suppliers  of  hotels,  etc. 
Commission  merchants  and  wholesalers  could  sell  cold-storage  eggs  at  a  maximum  of  4 
per  cent  over  cost ;  jobbers  at  5  per  cent  for  cold-storage  eggs  and  10  per  cent  for  candled 
eggs,  while  suppliers  of  hotels  and  institutions  were  permitted  to  take  a  profit  of  12 
per  cent  on  either  type. 

1  By  January,  1918,  the  wholesale  price  of  butter  had  risen  but  60  per  cent  above  the 
prewar  average,  while  the  general  price  level  had  advanced  approximately  85  per  cent. 

2  It  will  be  noted  that  prices  were  fixed  only  at  New  York  and  Chicago.     It  was  thought 
unnecessary  to  fix  prices  at  other  points,  since  the  principal  butter  exchanges  were  located 
in  those  two  important  centers.     These  exchanges  had  agreed  to  sell  their  butter  at  the 
established  prices,  and  this  was  regarded  as  sufficient  assurance  that  corresponding  prices 
would  rule  throughout  the  country- 


104  HISTORY   OF   PRICES   DURING   THE   WAR. 

butter  kept  in  cold  storage  for  more  than  30  days.  No  specific  mar- 
gins were  designated  for  butter  manufacturers  as  such,  although  all 
other  dealers  were  limited  as  to  the  amount  they  could  add  to  cost 
in  making  sales.1 

To  dealers  other  than  manufacturers  or  retailers  there  was  per- 
mitted a  margin  over  cost  varying  from  1  to  2|  cents  per  pound,  de- 
pending upon  the  size  of  the  sales  made.2  Commissions  for  sales  by 
commission  merchants  were  also  limited,  but  charges  so  incurred 
could  not  be  figured  in  determining  costs. 

It  is  of  interest  that  during  the  first  year  of  governmental  regula- 
tion no  specific  statement  was  made  in  regard  to  prices  to  be  charged 
by  butter  manufacturers  selling  their  product  to  wholesalers  or  job- 
bers. To  be  sure,  the  Food  Administration  had  a  right  to  ask  at 
any  time  for  a  report  showing  costs,  margins  charged,  or  any  other 
information  along  such  lines,  and  in  this  way  prices  were  kept  under 
control.  In  those  cases  where  manufacturers  sold  as  wholesalers  or 
jobbers,  eliminating  the  middleman,  they  were  entitled  to  the  mar- 
gins allowed  to  wholesalers  or  jobbers.  The  significant  point  in  this 
connection,  however,  was  the  method  of  determining  costs,  since  the 
methods  used  for  cold-storage  butter  was  distinctly  different  from 
those  used  for  the  fresh  variety.  In  the  latter  case  only  the  cost  of 
raw  materials  and  the  expense  of  manufacture  were  recognized;  in 
the  former  the  quotation  "  on  the  kind  and  grade  of  butter  placed  in 
cold  storage,  as  quoted  in  a  well-recognized  commercial  price  current 
in  the  city,-  where  and  on  the  day  when  the  goods  [were]  placed  in 
storage  "  was  to  serve  as  the  cost  basis.3  Near  the  end  of  1918,  how- 
ever, a  definite  margin  was  fixed  for  manufacturers  of  butter  who 
sold  their  products  to  others  than  retailers.4 

Retail  dealers  likewise  were  regulated  as  to  their  returns  only  at 
a  late  date,  and  to  them  was  allowed  an  advance  over  cost  of  6  cents 

1  As  in  all  other  cases,  the  reasonable-advance-over-cost  rule  was  applied  to  the  indus- 
try.    Unlike  the  average  foodstuff,  however,  the  elements  which  could  be  included  in  the 
determination  of  costs  were  specifically   stated  in   the  regulations  pertaining  to  butter. 
They  were,  first,  purchase  price;  second,  transportation  charges;  third,  storage  charges; 
fourth,  insurance  charges ;  fifth,  interest  on  money  invested  at  current  rate  while  butter 
was  in  storage ;  and,  sixth,  actual  cost  of  printing. 

2  The  maximum  margin  was  changed  by  the  regulations  of  Sept.  10,  1918,  to  3|  cents, 
which  applied  to  sales  of  less  than  100  pounds.     Dealers  carrying  butter  in  cold  storage 
more  than  2  full  calendar  months  could  add  to  the  permitted  margin  an  extra  cent  per 
pound.     For  every  calendar  month  in  excess  of  2,  an  additional  quarter  of  a  cent  per 
pound  was  permitted,  until  a  maximum  of  2  cents  was  reached. 

3  When  there  was  no  well-recognized  daily  price  current  in  the  city  where  the  goods 
happened  to  be  stored,  permission  was  granted  to  use  quotations  given  in  a  price  current 
in  the  large  market  nearest  the  place  of  storage. 

4  That  is,  manufacturers  who  sold  their  butter  to  wholesalers  or  jobbers,  who  in  turn 
disposed  of  their  goods  to  retailers,  restaurants,  hotels,  etc.    The  margin  for  these  manu- 
facturers was  set  at  5  cents  above  the  cost  of  the  butter  fat  required  to  produce  a  pound 
of  butter.     In  other  words,  "if  the  cost  of  butter  fat  was  50  cents  per  pound,  and  8 
pounds  of  butter  fat  were  necessary  to  produce  10  pounds  of  butter,  the  cost  of  butter 
fat  necessary  to  produce  butter  would  be  40  cents  per  pound  of  butter   (manufactured) 
and  the  maximum  selling  price  for  the  manufacturer  would  be  45  cents." 


GOVERNMENT    CONTROL   OVER   PRICES.  105 

per  pound  to  cash-and-carry  stores,  and  7  cents  per  pound  for  stores 
extending  credit  and  delivery.  The  addition  of  an  extra  margin  for 
butter  kept  in  storage  which  was  guaranteed  to  other  dealers  was  also 
allowed  to  retailers. 

Cheese—  -The  prices  of  cheese  follow  closely  the  general  tendencies 
of  butter,  and  since  the  two  industries  show  considerable  likeness, 
the  Food  Administration  .adopted  regulations  for  the  cheese  industry 
which  were  very  similar  toj;hose  for  the  butter  industry.  No  definite 
return  was  established  for  the  manufacturer  of  cheese,  and  his  profits 
were  kept  in  check  under  the  reasonable  advance  regulation.1 

Dealers  were  limited  in  the  advances  permitted  over  the  cost  of 
their  product,  and  like  the  margins  allowed  in  the  butter  industry, 
these  margins  varied  with  the  size  of  the  sales.2  Retail  margins, 
too,  were  fixed  and  a  maximum  profit  of  7  cents  per  pound  over 
cost  was  allowed  to  cash-and-carry  stores,  while  an  advance  of  8 
cents  per  pound  over  cost  was  permitted  to  stores  which  extended 
credit  and  delivery. 

Milk.— With  feed  stuffs  in  July,  1917,  selling  at  a  level  118  per 
cent  higher  than  during  the  prewar  year,3  and  cows  for  slaughter 
averaging  about  50  per  cent4  more  than  the  average  peace-time 
price,  it  was  to  be  expected  that  milk,  too,  would  rise  in  proportion. 
But,  curiously,  the  price  of  milk  remained  relatively  stable,5  and 
July,  1917,  found  the  wholesale  price  of  fresh  milk  in  New  York 
but  $0.0498  per  quart,  or  approximately  7  per  cent  above  the  prewar 
average. 

It  was  but  natural,  then,  that  a  demand  for  increased  milk  prices 
should  arise  among  milk  producers,  and  at  the  time  of  the  organi- 
zation of  the  Food  Administration  a  general  movement  in  that  direc- 
tion had  already  begun.  The  milk  distributor,  as  well  as  the  pro- 

1  Exact  margins  were  not  fixed  at  a  later  date  for  producers  of  cheese  as  they  were 
for  butter.     However,  a  provision  was  adopted  which  outlined  two  ways  of  determining 
the  cost  of  a  supply  of  cheese  for  the  manufacturer,  who  also  sold  as  a  wholesaler  or 
jobber  and  who  wished  to  secure  the  benefits  of  such  margins  as  were  allowed  to  the 
middlemen.     Costs  under  such  circumstances  could  be  figured,  first,  by  computing  the  cost 
of  the  raw  material  and  the  expense  of  manufacture ;  or,  secondly,  by  considering  as  cost 
the  price  for  the  cheese  to  be  sold  in  the  primary  market  during  the  10  days  following 
the  day  of  manufacture.      (This  latter  method  applied  only  to  the  determination  of  the 
cost  of  American  or  cheddar  cheese.) 

2  Certain  advances  over  cost  were  established  for  the  individual  types  of  cheese.     Mar- 
gins for  American  or  cheddar  cheese,  for  example,  ranged  from  three-fourths  to  3J  cents 
per  pound;  those  for  round  or  tub  Swiss  cheese  from  11  to  8  cents  per  pound.     Dealers 
in  block  Swiss  cheese  were  allowed  from  1  to  4J  cents  per  pound  ;  while  brick,  Limburger, 
and  Munster  cheese  could  be  sold  at  a  maximum  advance,  which  ranged  from  1J  to  3| 
cents. 

3  See  "  Prices  of  Feed  and  Forage,"  by  Lloyd  W.   Maxwell    (W.   I.  B.   Price   Bulletin 
No.  8). 

4  See  "  Prices  of  Live  Stock,   Meats,   and  Fats,"   by  Wm.   A.    Barber    (W.    I.    B.    Price 
Bulletin  No.  20). 

5  The  price  of  milk,  of  course,  is  subject  to  extreme  seasonal  fluctuation,  but  as  prices 
go  it  may  be  said  that  the  milk  situation  was  quite  unaffected  by  the  general  upheaval 
which  characterized  prices  in  general.     Milk  in  New  York,  to  be  sure,  in  1916,  had  sold 


106 


HISTORY  OF  PRICES  DURING  THE   WAR. 


ducer,  played  an  important  part  in  price  revisions,  and  lie,  too,  was 
asking  for  increased  prices  because  of  increased  labor  costs,  over- 
head charges,  and  other  necessities.  While  both  the  aforementioned, 
however,  demanded  an  increased  price,  each  appears  to  have  doubted 
the  necessity  of  an  increase  for  the  other.  Distributors  on  the  one 
hand  objected  to  the  raising  of  prices  by  producers,  and  producers 
on  the  other  hand  protested  against  the  demand  of  distributors.1 

as  high  as  $0.0523  per  quart  (November  and  December),  or  about  50  per  cent  above  the 
level  of  the  prewar  year ;  but  this  price,  it  should  be  borne  in  mind,  was  temporary  and 
should  be  compared  with  the  average  price  of  $0.0388  for  the  year. 

A  more  detailed  picture  of  milk  prices  can  be  obtained  from  the  following  table : 

Milk  (per  quart},  grade  B,  New  York. 


Month. 

1913 

1914 

1915 

1910 

1017 

1918 

January  

$0.  0375 

$0  0400 

$0.0413 

$0  0413 

10  0513 

$0  0808 

February 

0375 

0375 

0393 

0400 

0500 

0770 

March 

0350 

0350 

0375 

0375 

0490 

0745 

April  

0333 

0325 

0325 

0325 

0488 

0590 

May 

0300 

0266 

0275 

0300 

0478 

0583 

June  

0275 

0275 

*0275 

0275 

0455 

0443 

July 

0300 

0300 

0300 

0313 

0498 

0538 

August  

0350 

0325 

0325 

0350 

0595 

0633 

September 

0375 

0350 

0350 

0365 

0595 

0675 

October  

0400 

0400 

0375 

0500 

0718 

0818 

November 

0404 

0425 

0425 

0523 

0770 

0870 

December  

0404 

0425 

0425 

0523 

0718 

0923 

Year  

0353 

0351 

0355 

0388 

05G8 

0699 

1  Mr.  W.  C.  Mullendore  in  the  summary  report  of  the  Food  Administration,  analyzing 
the  milk  situation  as  it  existed  in  the  summer  and  autumn  of  1017,  says: 

"  In  some  of  the  larger  centers  the  controversies  became  very  bitter  and  often  un- 
reasoning. An  increase  in  the  price  of  milk  when  made  was  followed  by  a  marked 
decrease  in  consumption,  which  not  only  resulted  in  suffering  children,  but  also  dammed 
the  supply  back  onto  the  farm  with  a  loss  to  the  producer,  which  encouraged  the  killing 
off  of  herds.  It  was  feared  the  result  would  be  the  depletion  of  dairy  herds,  a  result 
which  the  consumer  could  of  all  concerned  the  least  afford  to  cause. 

Moreover,  there  was  the  actual  problem  of  future  supplies  which  was  becoming  more 
and  more  acute.  The  Food  Administration  realized  the  severity  of  the  situation  and 
took  immediate  steps  to  inform  the  public  of  the  state  of  affairs,  as  is  evidenced  by  the 
following  statement  issued  on  Aug.  26,  1917  : 

Milk  and  butter  supplies  are  decreasing  in  the  United  States,  while  our  population 
is  increasing.  The  dairy  herds  of  Europe  are  diminishing  rapidly  because  of  the  condi- 
tions created  by  war,  and  there  is  no  probability  of  improvement  in  these  conditions. 
The  dairy  problem  in  this  country,  therefore,  is  not  only  a  war  emergency  problem,  but 
one  that  will  continue  after  the  war. 

The  world's  dairy  supplies  are  decreasing  rapidly  for  two  important  reasons  :  First, 
the  dairy  cattle  of  Europe  are  diminishing,  for  Europe  is  being  driven  to  eat  its  cattle 
for  meat ;  second,  the  diversion  of  labor  to  war  has  decreased  the  fodder  supplies,  and 
the  shortage  of  shipping  has  limited  the  amount  of  imported  fodder,  and  therefore  the 
cattle  which  can  be  supported  and  the  productivity  of  the  individual  cow  have  been  re- 
duced. Even  our  own  dairy  supplies  are  not  keeping  pace  with  our  growth  of  population, 
for  our  per  capita  milk  supply  has  fallen  from  90  to  75  gallons  annually  in  the  past  15 
years.  Yet  to-day  we  must  ship  increasing  amounts  of  dairy  products  to  our  Allies. 

The  dairy  situation  resolves  itself  into  several  phases.  First,  it  is  to  be  hoped  that 
the  forthcoming  abundant  harvest  will  result  in  lower  prices  of  food  and  diminish  the 
impetus  to  sell  the  cattle  for  meat.  Second,  the  industry  needs  encouragement,  so  as  to 
increase  the  dairy  herd,  and  thus  our  dairy  supplies,  for  the  sale,  first,  of  our  own  people 
and,  second,  of  the  Allies.  The  people  must  realize  the  vital  dependence  of  the  well-being 
of  their  children,  and  thus  of  the  Nation,  upon  the  encouragement  and  upbuilding  of  the 
industry." 


GOVERNMENT   CONTROL   OVER   PRICES.  107 

There  was,  too,  always  a  third  party  with  whom  to  reckon,  the 
ultimate  consumer,  who  would  bear  the  burden  of  increasing  prices. 
He  of  course  objected  to  an  increase  on  the  part  either  of  the  pro- 
ducer or  distributor,  and  often  accused  both  of  profiteering. 

The  Food  Administration  soon  was  called  upon  to  help  solve  the 
difficulties,  and  after  consideration  it  became  apparent  to  that  body 
that  here  was  a  problem  peculiarly  difficult.  For  not  only  was  there 
the  question  of  determining  a  fair  price,1  but  there  was  also  the 
problem  of  enforcing  such  a  price  after  it  had  been  determined,  and 
for  such  action  the  Food  Administration  had  no  power.2  The  prob- 
lem had  to  be  solved,  however,  and  the  first  step  taken  was  the 
appointment  by  the  Food  Administration  of  a  committee  to  investi- 
gate the  costs  of  milk  production  and  distribution.  The  Food 
Administration  after  conferring  with  representatives  of  the  milk 
producers,  also  suggested  that  milk  contracts  "affecting  the  prices 
producers  receive  *  *  *  be  on  a  monthly  basis  instead  of  a  period 
of  six  months,  as  customary."  In  this  way  prices  could  be  changed 
from  month  to  month  as  conditions  warranted,  and  many  of  the 
evil  results  of  the  long-time  contract  could  be  eliminated.  This 
change  in  business  method  seemed  not,  however,  to  alleviate  condi- 
tions to  any  appreciable  degree,  since  producers,  distributors,  and 
consumers  all  continued  to  ask  the  Food  Administration  for  relief. 

Finally,  in  November,  1917,  milk  tribunals  representing  the  Federal 
Government  wTere  asked  to  solve  the  milk  problems  of  the  metropoli- 
tan areas.  These  commissions  were  made  up  of  representatives  of 
producers,  distributors,  consumers,  milk  experts,  and  the  public  at 
large,  and  it  was  their  duty  "  after  assembling  data  bearing  on  prices 
to  make  reports  that  would  advise  the  public  of  the  true  status  of  the 
milk  industry  "  in  the  various  districts  investigated.3  Producers  and 
distributors  agreed  to  abide  by  the  decisions  of  the  commission  in 
their  respective  territories  so  long  as  they  remained  parties  to  the 
agreement  for  its  appointment,  but  they  were  given  the  right  to 
withdraw  from  the  arrangement  upon  30  days'  notice.4  Moreover,  it 

*Mr.  Hoover  in  an  address  at  the  National  Milk  and  Dairy  Farm  Exposition  in  New- 
York  on  May  23,  1918,  laid  considerable  emphasis  upon  the  difficulties  met  in  finding  a 
basic  price  for  dairy  products,  especially  milk.  Among  other  things,  he  said : 

"  These  complexities  arise  from  the  fact  that  in  a  considerable  part  of  the  industry 
the  raw  material  in  feeds,  the  labor,  land,  and  equipment  employed,  are  by-products  of 
other  major  agricultural  operations,  and  the  commodities  produced  (from  milk*  are  all 
in  different  circumstances,  by-products  of  each  other." 

2  Mr.  Hoover  in  a  letter  of  Sept.  22,  1917,  to  Mr.  I.  Blkin  Nathans,  secretary  of  the 
New  York  Milk  Conference  Board,  said  in  this  connection  : 

"  I  have  given  earnest  consideration  to  your  request  for  the  intervention  of  the  Food 
Administration  in  the  pending  settlement  of  milk  prices  with  producer's  representatives. 
As  you  are  aware,  the  administration  has  no  authority  to  intervene  or  fix  prices." 

3  Commissions  were  appointed  for  the  New  England  district  around  Boston,  the  New 
York  City  district,  the  Chicago  district,  the  San  Francisco  district,  and  later    (Feb.   21, 
1918)  for  the  important  consuming  centers  of  Ohio. 

4  Report  of  Food  Administration  by  W.  C.  Mullendore. 


108  HISTORY   OF  PRICES   DURING   THE   WAR. 

was  voluntarily  agreed  that  no  increases  in  the  price  of  milk  were  to 
be  allowed  while  the  various  commissions  were  making  their  inquiries. 

The  commissions  appear  to  have  had  different  degrees  of  success, 
and  the  period  of  their  functioning  varied  from  several  months  to 
one  year.  The  New  England  commission  was  the  only  one  which 
remained  in  existence  from  the  time  of  its  appointment  to  December, 
1918,  when  the  oversight  of  the  Food  Administration  was  withdrawn. 

In  New  York  where  the  greatest  difficulty  was  experienced,  prices 
were  first  fixed  for  January,  1918,  and  the  milk  commission  continued 
price  recommendations  from  month  to  month  on  the  basis  of  data 
submitted.  In  May,  however,  virtually  all  milk  distributors  who 
were  parties  to  the  price  agreement  specified  their  intention  of  with- 
drawing during  the  following  month,  and  on  July  1  the  agreement 
terminated.  After  considerable  wrangling  over  prices  between  the 
producers  and  distributors,  the  Food  Administration  was  once  more 
called  in,  this  time  to  act  as  mediator  in  arriving  at  a  fair  price. 
There  appeared,  however,  to  be  no  common  basis  for  agreement. 
Indeed,  it  was  not  until  the  Food  Administration  suggested  a  price 
of  $2.70  per  100  pounds  of  milk  for  the  month  of  August,  and  $2.90 
for  September1  that  the  situation  quieted  down.  During  the  re- 
mainder of  the  year  the  Food  Administration  continued  to  act  as 
mediator  in  the  determination  of  milk  prices  for  the  New  York 
district,  and  their  efforts  seem  to  have  been  more  or  less  successful.2 
Conditions  in  the  other  municipal  centers  were  akin  to  those  in 
New  York,  and  the  price  problem  was  generally  solved  through  the 
application  of  cost  data. 

Although  the  milk  problem  was  immediately  one  of  price,  the 
degree  of  organization  within  the  industry,  and  the  consequent  power 
of  the  producer  and  distributor  to  withhold  milk  from  the  market, 
resulted  in  the  question  resolving  itself  ultimately  into  one  of  public 
health  and  public  welfare.  There  was  needed  not  only  a  fair  price 
for  milk,  but  also  a  sufficient  supply,  and  the  latter  meant  an  increase 
in  cattle  herds.  The  regulation  of  milk  prices  apparently  did  not 

1  This  price  was  arrived  at  by  use  of  a  formula  which  averaged  the  cost  of  feed  and 
labor  required  to  produce  100  pounds  of  milk.     Representatives  of  the  distributors  during 
the  early  stages  of  the  negotiations  appear  to  have  objected  to  this  use  of  a  cost-of- 
production  formula.     Later,  however,  they  gave  their  assent  to  its  adoption. 

2  The  wholesale  prices,  per  100  pounds,  adopted  for  the  year  1918  for  New  York  City, 
for  grade  B  milk,  totaling  3  per  cent  butter  fats  within  a  freight  zone  of  150  miles  were 
as  follows : 


January.. 
February . 

March 

April 

May 

June 


$3.52 
3.  34 
3.  22 


2.  50 
2.  46 
1.80 


July $2.  25 

August t  2.  70 

September t  2.  90 

October t  3.  57 

November t  3.  81 

December-.                                  t  4.  06 


*Fixed  by  milk  commission. 

fFixed  by  producers  and  consumers  with  Food  Administration  as  mediator. 


GOVERNMENT    CONTROL    OVER   PRICES. 


109 


have  a  serious  effect  upon  the  supply  of  cattle,  for  the  number  of 
milch  cows  increased  slightly  during  the  year  1918.  This  increase, 
however,  was  the  smallest  for  any  single  year  since  1913.1 

It  is  impossible  to  determine  the  effect  of  price  regulation  upon 
the  consumption  of  milk,  since  there  are  no  reliable  statistical  data. 
The  milk  production  for  1918  has  been  estimated  at  46,384,000,000 
quarts  as  against  44,640,000,000  in  1917,  an  increase  of 
approximately  3  per  cent.  But  after  allowing  for  the  increase  of 
1.23,000,000  pounds  in  the  exports  of  1918  over  1917,  and  taking  into 
consideration  the  normal  annual  increase  in  population,  it  is  ques- 
tionable whether  the  consumption  of  milk  in  the  United  States 
actually  increased. 

OLEOMAKGARINE. 

The  regulations  relating  to  oleomargarine  were  few,  since  this  fat- 
was  provided  for  under  the  regulations  applicable  to  the  packing  in- 
dustry, in  whose  hands  the  larger  part  of  the  oleomargarine  produc- 
tion is  concentrated. 

Not  until  late  in  1918  were  definite  steps  taken  to  establish  a  maxi- 
mum price  for  oleomargarine,  and  this  action  no  doubt  was  prompted 
by  the  upward  tendency  of  its  price  started  during  the  midsummer 
months.  Standard  uncolored  oleomargarine  advanced  7.5  cents  dur- 
ing the  single  month  of  August.  A  careful  analysis  of  the  costs  of 
producing  oleomargarine  was  made  during  the  latter  part  of  1918, 
and  6.3  cents  was  determined  upon  as  a  reasonable  figure  to  allow 
during  the  two  months  beginning  December  1,  1918. 2  Each  manu- 
facturer, therefore,  in  figuring  the  total  cost  of  his  product  was  per- 
mitted to  add  to  the  cost  of  raw  materials  an  amount  not  to  exceed 
6.3  cents  per  pound.3 

1  The  following  table  from  the  monthly  Crop  Reporter  of  the  Department  of  Agriculture,  February, 
1919,  shows  the  condition  of  the  milch  cow  herds  in  the  United  States  on  Jan.  1, 1919,  as  compared  with 

the  same  day  in  previous  years: 

Milch  cows  in  the  United  States. 


Number. 

Per  cent 
of  pre- 
ceding 
year. 

Number. 

Per  cent 
of  pre- 
ceding 
year. 

Jan.    ,  1919      

24,467  000 

100.7 

Jan.  1  1914     

20,737,000 

101.2 

Jan.      1918 

23  310  000 

101  8 

Jan.  1  1913       

20,  497,  000 

99.0 

Jan       1917 

22  894  000 

103  6 

Jan  1  1912 

20  699  000 

99  4 

Jan.      1916 

22'  ios'  ooo 

104  0 

Jan.  1  1911       

20.  823,  000 

100.9 

Jan       1915 

21  262  000 

102  5 

Jan.  1  1910                  .     .  . 

*20  625,000 

*  Census  report  of  Apr.  15, 1910. 

2  Manufacturing  costs  includeu :    (1)   Labor,    (2)    selling  expensesfi    (3)   advertising,   (4) 
administrative  expenses,   (5)   depreciation,   (6)   taxes — not  including  excess-profit  tax  and 
income    tax — and     (7)     miscellaneous    manufacturing    expenses — not    including    interest 
charges. 

3  The  cost  of  raw  materials  was  defined  as  the  cost  of  the  following  delivered  at  the 
plant:    (1)  Oils,  (2)   milk,  (3)  salt,  (4)  package,  (5)   color,  (6)   stamps,   (7)  cartons  and 
paper,  and   (8)   supplies. 


110 


HISTORY   OF   PRICES   DURING  THE   WAR. 


As  regards  manufacturers'  profits,  these  were  limited  to  10  per  cent 
over  cost,  while  to  retailers  there  was  granted  the  right  to  add  5  cents 
per  pound  over  cost  for  cash-and-carry  stores,  and  6  cents  per  pound 
for  stores  rendering  extra  services. 

COTTON  SEED  AND  COTTONSEED  PRODUCTS. 

The  early  price  situation. — The  speculative  nature  of  the  cotton- 
seed industry,  the  scarcity  of  substitutes  for  cottonseed  products,  and 
the  falling  off  in  the  supply  of  cottonseed  oil  because  of  the  small 
cotton  crops  in  the  years  1915  to  1917,1  all  played  an  important  part 
in  the  price  movement  of  cotton  seed  and  its  products  during  the 
war  period. 

The  effect  of  these  various  factors  upon  the  price  of  cottonseed 
products  was  clearly  reflected  even  in  1915  when  the  price  of  cotton- 
seed oil  jumped  from  4.4  cents  in  August  to  7.31  cents  in  December. 
After  this  initial  start,  the  price  continued  a  general  upward  climb 
until  further  rise  was  checked  by  governmental  action.2  By  August, 
1917,  the  month  of  the  creation  of  the  Food  Administration,  cotton- 
seed prices  had  risen  to  $56.61  per  ton,  a  point  approximately  150 
per  cent  above  the  prewar  level.  The  main  product,  oil,  had  similarly 
risen  from  an  average  of  $0.0619  per  pound  in  the  prewar  year  to 
$0.1392,  an  increase  of  about  125  per  cent. 

^~The  licensing  of  the  industry. — The  importance  of  oils  of  all  sorts 
in  our  war  program,  and  the  acute  demand  for  cottonseed  cake,3 
made  necessary  some  immediate  action  toward  stabilizing  prices. 
Accordingly,  by  presidential  proclamation,  all  ginners,  crushers,  re- 
finers, and  dealers  in  cotton  seed,  cottonseed  oil,  meal  and  cake  were 

1  The  3  years  ending  1918  were  relatively  lean  years  in  cotton  seed  production.  The  amount  of  cotton 
seed  crashed  was  considerably  smaller  than  in  any  of  the  preceding  3  years,  and  had  its  effect  upon  the 
production  of  cottonseed  oil.  The  fluctuations  which  characterized  the  course  of  the  cotton  seed  industry 
are  shown  in  the  appended  table:* 


Year. 

Cotton  seed 
production. 

Cotton  seed 
crushed. 

Cottonseed 
oil  (crude) 
production. 

1912-13 

Short  tons. 
6  104  000 

Short  tons. 
4  580  000 

Pounds. 
435  ooo  000 

1913-14                    .          

6  305  000 

4'  848'  000 

'500'  ooo  ooo 

1914  15 

7  186  000 

5  780  000 

790  0(K)  000 

1915-16                  ..          

4'  992'  ooo 

4*202^000 

300  000,000 

191&-17 

5  113  000 

4  479  000 

492  000  000 

1917-18                      ....           . 

5  040  000 

4  '252  000 

344,000  000 

• 

*  Data  from  War  Industries  Board  Price  Bulletin  No.  15,  "Prices  of  Edible  Vegetable  Oils. " 

2  See  chart  on  p.   114. 

3  The  autumn,  of  1017  witnessed  a  severe  drought  in  the  southwestern   section  of   the 
United   States,   and   there  was  great  suffering  among  cattle  because  of  the  shortage  of 
feed  stuffs,   the   most   important  of   which   was  cottonseed   cake.      The   unusual   demand 
caused  by  this  situation   still   further  accentuated  the  already   high  price  of  cottonseed 
cake,  and  the  Food  Administration  realized  that  immediate  action  toward  stabilizing  the 
situation  was  necessary. 


GOVERNMENT   CONTROL   OVER  PRICES.  Ill 

placed  under  license  on  November  1,  1917.  Regulations  designed  to 
prevent  speculation  were  soon  put  into  effect,  and  hoarding,  reselling, 
and  the  making  of  long-time  contracts  were  prohibited.  Moreover, 
speculation  in  cottonseed  oil  on  the  New  York  Produce  Exchange 
was  checked.  About  one  month  later  the  first  attempt  at  regulating 
the  price  of  cotton  seed  and  its  products  was  made,  and  on  December 
7, 1917,  the  margin  allowed  to  any  dealer  in  cotton  seed  in  car  lots  was 
fixed  at  $2  per  ton.  Crushers'  margins  were  also  fixed  at  the  same 
time,  and  a  maximum  margin  of  $13  a  ton  over  the  cost  of  a  ton  of 
cotton  seed  was  allowed  for  products  obtained  from  crushing.1  But 
even  with  fixed  margins  there  was  no  guarantee  that  the  varying 
costs  of  cotton  seed  would  not  cause  fairly  important  fluctuations  in 
the  price  of  any  given  product  in  the  same  localities,  if  not  in  the 
same  mill.  For,  although  a  margin  had  been  fixed  for  the  sale  of 
cotton  seed,  there  still  remained  the  possibility  of  appreciable  differ- 
ences in  the  initial  cost  to  which  the  allowable  margin  was  to  be 
added.  This  difficulty  was  soon  foreseen,  however,  and  a  further 
restriction  was  included  in  the  regulations  applying  to  the  cotton- 
seed industry,  limiting  to  a  degree  the  price  that  could  be  paid  by 
a  crusher  for  the  seed  he  used.  He  was  not  allowed  to  pay  higher 
prices  for  cotton  seed  in  one  market  than  he  paid  for  cotton  seed  of 
the  same  quality  in  any  other  market. 

Thus,  the  price  of  cotton  seed  was  virtually  fixed  and  the  return 
to  the  crusher  confined  to  more  or  less  narrow  limits.  There  yet 
remained  the  problem  of  the  refiner's  price.  This  appears  to  have 
been  left  relatively  untouched,  since  the  control  over  the  profits  of 
refiners  and  distributors  through  the  license  system 2  afforded  a  suffi- 
ciently powerful  weapon  to  keep  the  price  down.  It  soon  became 
apparent,  however,  that  the  market  would  be  further  stabilized  if 
the  cost  of  the  crude  cottonseed  oil  were  made  uniform  to  the  various 
refiners.  The  maximum  price  of  crude  cottonseed  oil,  therefore, 
was  fixed  by  agreement  with  the  producers  at  17.  5  cents  per  pound  at 

1  This    margin    of   $13    was    to    pay    not    only    for    manufacturing    costs,    but    also    for 
bags  and  other  incidentals  used    in  packing  the  products.     This   margin,   however,   was 
to  apply  only  to  a  certain  minimum  yield  from  a  ton  of  seed.     Thus,   for  example,  a 
standard  yield  of  products  was  worked  out  for  a  ton  of  cotton   seed  and   a  margin  of 
$13  was  allowed  on  this  yield.     If,  however,  the  product  of  a  crusher  happened  to  be 
more  than  the  standard  yield,   he  was  allowed  to  sell  the  excess  without   reference  to 
the  fixed  margin,   "provided  the  price  charged  for  said  excess  products  shall  not  exceed 
the  average  price  for  the  other  products  in  said  yield." 

The  standard  yields  for  a  ton  of  seed  fixed  by  the  Food  Administration  were  as  follows  : 
Southern  States  east  of  the  Mississippi  River — 43  gallons  of  oil,  960  pounds  of  meal, 
140  pounds  of  lint,  and  480  pounds  of  hulls;  States  west  of  the  Mississippi  River— 38 
gallons  of  oil,  1,000  pounds  of  meal,  150  pounds  of  lint,  and  470  pounds  of  hulls. 

2  One  of  the  fundamental  rules  applied  in  the  regulation  of  the  distribution  of  food- 
stuffs, as  mentioned   in  previous  pages,  was  that  "  licensees  shall  sell  the  commodities 
specified  in  his  license  at  not  more  than  a  reasonable  advance  over  the  actual  cost     * '     *     * 
without  regard   to  the  market  or  replacement  value  at  tho  time  of  sale."     The  whole- 
sale price  of  cottonseed  oil  was  controlled  by  a  maximum  margin  of  12  to  15  per  cent, 
fixed  on  sales  to  retailers  on  June  15,  1918. 


112  HISTORY   OF   PRICES   DURING  THE   WAR. 

the  crushing  mill,  effective  January  1,  1918.  This  price,  it  should 
be  noted,  was  about  2J  cents  above  the  average  for  the  year  1917. 
The  agreed  price  may  appear  very  high,  but  fats  and  oils  were  in 
abnormal  demand  for  war  purposes,  and  it  was  believed  that  a  high 
price  was  necessary  to  encourage  high-cost  producers. 

Control  over  the  1918  crop. — With  the  advent  of  the  new  cotton 
crop  of  1918  it  became  apparent  that  a  more  thorough  method  of 
price  stabilization  would  be  necessary.  This  opinion  was  held  not 
only  by  the  cottonseed  product  manufacturers  but  also  by  members 
of  the  live-stock  industry  who  were  feeling  the  effects  of  an  un- 
steady market  for  cottonseed  meal.  The  cotton  seed  producers  were 
especially  insistent  that  a  more  complete  system  of  control  be 
adopted,  and  in  September  representatives  of  the  industry  recom- 
mended that  the  Food  Administration  stabilize  the  price  of  cotton 
seed  at  $70  per  ton  in  carloads  lots.  This  basic  price  was  to  apply  to 
cotton  seed  yielding  41  gallons  of  oil  per  ton,  and  variations  were 
to  be  allowed  between  a  minium  of  $64  and  a  maximum  of  $74  in 
proportion  to  the  oil  yielded.  A  differential,  as  in  the  previous  year, 
was  fixed  for  the  return  to  crushers.  The  allowance  over  cost,  how- 
ever, was  increased  over  that  for  the  1917  crop  and  a  maximum  ad- 
vance of  $18.50  over  the  price  paid  for  a  ton  of  cotton  seed  was 
allowed  for  the  products  made  therefrom.  Prices  were  also  an- 
nounced for  cottonseed  meal  and  cake,  as  well  as  for  crude  cotton- 
seed oil.1  The  War  Industries  Board  had  already  fixed  the  price  of 
linters;2  and  thus  there  was  inaugurated  a  complete  system  of  price 
fixing  extending  from  the  farmer  who  raised  cotton  seed  to  the  re- 
tailer who  disposed  of  the  products. 

The  post-armistice  situation. — With  the  signing  of  the  armistice 
arose  the  problem  of  disposing  of  cottonseed  products  at  the  agreed 
prices.  Not  only  had  large  amounts  of  seed  and  oil  accumulated  in 
certain  localities,3  but  there  was  also  a  large  amount  of  cheaper  for- 
eign oils  competing  in  the  American  market  with  domestic  cotton- 
seed oil,  and  underselling  it.4 

1  It  appears  that  the  refiners  were  somewhat  hesitant  as  to  agreeing  to  take  the 
output  of  the  crushers  at  the  suggested  price  of  17J  cents  per  pound  f.  o.  b.  mills, 
since  they  had  no  assurance  against  loss  should  the  market  for  their  product  decline. 
The  Food  Administration,  however,  promised  to  assist  the  refiners  to  maintain  their 
price  throughout  the  year. 

a  See  page  703  of  the  present  volume. 

3  In   certain  sections   of  the   country  when   the   cotton   crop   did   well,   accumulations 
of  seed  and  oil  were  so  great  as  to  cause  many  crushers  to  cease  operations.     This,  of 
course,   reacted  upon   the  ginner   from   whom  the   crusher  received    his   seed,   and   so  on 
down  the  line  to  the  farmer  who  raised  the  cotton.     (Cf.  chapter  on  "  Cotton  seed  and 
cottonseed  products,"  by  W.  C.  Mullendore,  in  the  summary  report  of  the  United  States 
Food  Administration.) 

4  Because  of  the  scarcity  of  fats  and  oils  during  the  war  period,   the   importation  of 
foreign  vegetable  oils  was  encouraged.     Thus,  our  vegetable-oil  imports  in  1918,  in  spite 
of  the  acute  shipping  situation,  were  48  per  cent  larger  than  in  1917  and  114  per  cent 


GOVERNMENT   CONTROL  OVER  PRICES.  113 

* 

Moreover,  there  was  the  linter  difficulty  with  the  War  Industries 
Board  which  threatened  seriously  the  linter  market.1  The  industry 
was  in  a  precarious  condition,  and  it  seeme'd  as  if  there  would  be 
little  relief  afforded  from  any  quarter,  when  on  February  11,  1919, 
the  Food  Administration  called  together  representatives  of  all 
branches  of  the  industry  with  a  view  to  finding  a  solution.  It  was 
the  opinion  of  these  representatives  that  the  industry  would  be 
greatly  aided  by  the  stimulation  of  exports,  and  they  further  recom- 
mended that — 

Such  orders  as  were  received  for  lard  substitutes  through  the  Food  Adminis- 
tration or  by  the  manufacturers  should  be  manufactured  from  domestic  cotton- 
seed oil ;  that  crushers  should  use  their  best  efforts  to  purchase  seed  from  lo- 
calities where  the  heaviest  congestion  of  seed  existed ;  and  that  refiners  should 
purchase  crude  oil  from  crude  mills  where  the  heaviest  congestion  existed. 
They  further  unanimously  agreed  that  the  stabilization  plan  of  the  Food  Ad- 
ministration should  be  carried  out  to  its  completion,  notwithstanding  the  fact 
that  the  armistice  had  changed  the  situation,  and  there  was  a  fear  of  greater 
disaster  to  the  industry  if  the  Food  Administration  should  cease  its  efforts  to 
maintain  the  price  while  this  congested  condition  existed. 

The  American  Relief  Administration,  however,  appeared  on  the 
market  with  orders  for  large  amounts  of  oil  for  European  distribu- 
tion, and  the  heavy  exports 2  soon  relieved  the  situation.  The  sudden 
flow  of  oil  to  foreign  countries,  together  with  the  rise  in  the  price  of 
lard  and  the  consequent  increased  demand  for  lard  substitutes,  ap- 
pears to  have  brought  the  cottonseed  industry  back  to  normal.  By 
the  end  of  May  virtually  all  of  the  cotton  seed  of  the  1918-19  crop 
had  been  disposed  of  at  the  stabilized  price.  The  major  part  of  the 
manufactured  products  had  also  been  marketed  on  the  basis  of  the 

larger   than   in   1916.      Compared   to   our   imports   for   the    12   months   immediately   pre- 
ceding the  war  they  had  increased  181  per  cent. 

United  States  imports  of  vegetable  oils.* 


Pounds. 

1918 002,  000,  000 

1917—  -   616,  000,  000 


Pounds. 

1916 420,  000,  000 

1913-14t—  321,  000,  000 


*  Approximate  figures  based  on  data  from  Monthly  Summaries  of  Foreign  Commerce  of 
the  United  States  Department  of  Commerce. 

t  Fiscal  year  ending  June  30,  1914. 

1FThe  War  Industries  Board  had  fixed  the  price  of  linters,  as  mentioned  above,  and 
had  arranged  for  the  Ordnance  Department  to  take  over  the  entire  linter  crop.  After 
the  signing  of  the  armistice,  however,  the  latter  body  wished  to  be  relieved  of  their 
obligation.  A  long  controversy  took  place,  which  was  followed  by  an  agreement  whereby 
the  War  Department  was  to  take  all  the  linters  produced  up  to  an  agreed  date.  (A  more 
detailed  review  of  the  linter  situation  will  be  found  on  page  304  of  this  volume.) 

2  The  increase  in  cottonseed  oil  exports  in  the  early  months  of  1919  is  well  brought  out 
by  the  following  table  : 

Exports  of  cottonseed  oil  from  the  United  States. 


Pounds. 

December,  1918 11,  875,  368 

January,   1919 26,  573,  309 

125547°— 20 8 


Pounds. 

February,  1919 32,  042,  282 

March,    1919 19,  669,  660 


114 


HISTORY  OF   PRICES   DURING   THE   WAR. 


agreed  prices,  and  stocks  were  about  equal  to  the  average  for  May  of 
previous  years.  It  was  evident,  therefore,  that  control  of  the  cotton- 
seed industry  was  no  longer  necessary,  and  on  May  31,  1919,  "  all 
price  regulations  and  agreements  regarding  cotton  seed  and  products 
manufactured  therefrom,  including  lard  substitutes r  were  with- 
drawn. 

The  effects  of  control, — In  December,  1917,  when  the  first  definite 
price  regulation  was  applied  to  the  cottonseed  industry,  cottonseed 

oil  was  selling  for  a  price  180 
per  cent  higher  than  its  prewar 
average,  and  approximately  100 
per  cent  above  that  of  commodi- 
ties in  general.  Similarly,  lard 
substitutes  were  about  150  per 
cent  higher  than  in  the  prewar 
year,  and  about  TO  per  cent 
above  the  general  price  level. 
Whether  the  price  stabilization 
inaugurated  by  the  Food  Ad- 
ministration prevented  a  further 
increase,  it  is  not  within  the 
province  of  this  study  to  deter- 
mine. One  fact  should  be  re- 
membered, however,  that  the 
prices  of  cotton  seed  and  its 
products  were  not  lowered 
through  governmental  regula- 
tion. They  were  only  stabilized. 
Indeed,  it  may  be  said  that  the 
Food  Administration  indicated 
its  approval  of  the  existing 
prices  of  these  commodities  in 
late  1917  and  fixed  them  at  the 
then  prevailing  level. 

The  elimination  of  speculation 
no  doubt  resulted  in  a  very  sub- 
stantial benefit  to  the  fanner,  and  reports  to  the  Food  Administra- 
tion from  seed  dealers  showed  that  the  "  farmer  *  *  received 
approximately  $10  per  ton  more  for  his  1917-18  crop  than  he  cus- 
tomarily received."1  Whether  the  fixed  high  price  stimulated  the 
production  of  cotton  seed  or  its  products  is  doubtful,  especially  in  the 
light  of  the  latest  available  data.  The  cottonseed  production  for  the 
year  1918-19  was  approximately  5,360,000  tons,2  a  crop  slightly  larger 


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Relative  prices. — Cotton  sseed  ;  lard  substi- 
tute ;  and  Crude  cottonseed  oil. — By 
months,  January,  1913,  to  December,  1018. 
(Average  quoted  prices,  July,  1913,  to 
June,  1914=100.) 


1  W.  C.  Mullendore. 

*  Bureau  of  Crop  Estimates,  U.  S.  Department  of  Agriculture. 


GOVERNMENT   CONTROL  OVER   PRICES.  115 

1      V 

than  that  of  1918,  but  small  when  compared  with  the  output  of  earlier 
years.1  And,  further,  the  amount  of  seed  crushed  for  the  crop  year 
up  to  April  30,  1919,  was  but  4,083,900  tons,  as  compared  with 
3,9555329  tons  for  the  same  period  in  the  preceding  crop  year,  and 
as  against  4,167,527  2  tons  for  the  corresponding  time  in  the  crop 
year  1916-17. 

CANNED  AND  DRIED  FOODS. 

Vegetables. — It  was  not  extraordinary  that  regulation  of  the  can- 
ning industry  should  have  been  provoked  when  profits  of  concerns 
in  various  parts  of  the  country  showed  an  average  increase  from  9 
to  32  per  cent  in  a  single  year,8  and  when  there  was  a  pressing  war- 
time need  for  the  essential  foodstuffs  which  they  produced. 

Canned  food  prices  by  1917  had  risen  far  beyond  the  level  of  com- 
modities in  general.  The  large  demands  of  the  Army  and  Navy  had 
resulted,  even  before  the  creation  of  the  Food  Administration,  in 
the  appointment  of  a  war-service  council  of  canners  to  take  care  of 
the  requirements  of  the  various  governmental  bodies,  and  the  can- 
ners of  peas,  dried  beans,  tomatoes,  corn,  salmon,  and  sardines  wero 
included  in  the  presidential  license  proclamation  of  October  8,  1917. 
Accordingly,  on  the  1st  of  November,  the  greater  part  of  the  canning 
industry  went  under  license.4 

Steps  were  taken  immediately  to  curb  speculation,  and  the  first 
method  considered  was  that  almost  universally  applied,  namely,  the 
prohibition  of  long-time  contracts.  But  the  customs  and  seasonal 
character  of  the  trade  appear  to  have  made  the  application  of  this 
rule  to  the  canning  trade  impracticable,  and  instead  of  limiting  con- 
tracts to  the  customary  60  days,  as  in  other  industries,  licensed  can- 
ners were  prevented  from  quoting  prices  on  future  sales  before  Feb- 
ruary 1  of  the  year  in  which  such  products  were  to  be  canned.5 

1  See  table  on  p.   110. 

-  Data  from  U.  S.  Bureau  of  Census,  Department  of  Commerce. 

3  The  Federal  Trade  Commission's  "Report  on  Canned  Foods"    (1918)   in  its  chapter 
on  profits  says,  among  other  things  : 

"  In  1916,  42  packers,  representing  invested  capital  amounting  to  $12,752,241.03, 
showed  net  incomes  aggregating  $1,224,009.69.  Thus,  the  return  on  investment  of  these 
packers  averaged  10  per  cent.  In  1917,  37  packers,  representing  invested  capital  amount- 
ing to  $12,224,210.68,  showed  net  incomes  aggregating  $3,876,263.08.  The  average  re- 
turn for  this  year  was  32  per  cent.  The  average  return  on  companies  for  which  there 
were  both  1916  and  1917  statistics  was  9  per  cent  in  1916  and  32  per  cent  in  1917." 

4  The  proclamation  of  Oct.  8,  1917,  included  only  those  packers  whose  output  exceeded 
5,000  cases  per  year.     On  Jan.  10,  1918,  this  amount  was  lowered  to  500  cases  per  year, 
thus  virtually  licensing  the  entire  industry.     On  Feb.  28  manufacturers  of  tomato  catsup 
and  other  tomato  products  were  added  to  the  licensed  list,  while  on  .Tune  15  canned  tuna 
came  under  the  control  of  the  Food  Administration. 

5  Mr.  W.  C.  Mullendore,  in  the  summary  report  of  the  Food  Administration,  ibid.,  iu  dis- 
cussing the  future  contract  situation  as  applied  to  the  canning  industry,  says,  in  part : 

"  This  industry  is  composed  of  thousands  of  small  units  and  it  does  not  require  a  large 
concentration  of  capital.  The  produce  to  be  canned  must  be  obtained  in  its  fresh  state 
direct  from  the  grower,  so  that  the  radius  of  operation  of  the  average  canner  is  neces- 


116  HISTORY   OF   PRICES   DURING   THE   WAR. 

No  method  of  price  regulation  other  than  the  "  reasonable-advance- 
over-cost"  clause  was  applied  to  the  canners  at  first.  It  was  soon 
found,  however,  that  the  enforcement  of  this  rule  presented  endless 
difficulties,  for  not  only  did  the  costs  vary  widely  in  different  parts 
of  the  country,  but  also  in  different  plants  in  the  same  neighbor- 
hood. Moreover,  the  character  of  the  industry  was  such  that  the 
raw  materials  used  were  but  a  minor  factor  in  the  total  cost,  and 
hence  it  was  impossible  to  determine  a  margin  which  could  be  added 
over  cost.1  The  first  measure  toward  solving  this  problem  was  one 
of  averaging  the  cost  of  the  season's  pack.  On  January  28,  1918, 
-regulations  were  amended  so  as  to  limit  the  selling  price  of  canned 
"  goods  manufactured  and  on  hand  to  not  more  than  a  reasonable 
advance  over  the  average  cost  of  the  season's  pack."  This  was  but 
a  temporary  palliative,  however,  for  it  was  soon  decided  that  an 
efficient  system  of  price  control  would  require  the  fixing  of  a  definite 
"  maximum  margin  in  cents  per  dozen  cans  "  over  the  cost  of  produc- 
tion. This  meant,  of  course,  an  analysis  of  the  cost  figures  of  each 
individual  plant,  since  the  food  law  had  been  so  drawn  as  to  make 
it  impossible  for  the  Food  Administration  to  reach  the  grower. 
However,  the  Federal  Trade  Commission  had,  in  early  1918,  com- 
pleted a  study  of  canning  costs  and  from  their  conclusions  it  was  pos- 
sible to  determine  a  reasonable  profit,  which  could  be  used  in  deter- 
mining the  differential  to  be  allowed  the  trade. 

Thus  the  canners  throughout  the  country  were  called  upon  to 
submit  cost  estimates  for  their  respective  plants,  and  to  these  costs, 
as  checked  up  and  approved  by  the  Food  Administration,  were 
added  "  maximum  margins  in  cents  per  dozen  cans  "  which  were  to 
represent  the  differences  between  costs2  and  selling  price.  These 

sarily  small.  In  order  to  secure  a  supply  for  his  plant  the  canner  contracts  with  the 
neighboring  growers  for  the  crop  of  a  certain  number  of  acres  to  be  planted  for  the  produc- 
tion of  a  named  commodity.  Before  the  adoption  of  the  Food  Administration  rule  pro- 
hibiting the  making  of  these  contracts  before  February  1  of  the  year  in  which  the  products 
were  to  be  canned,  they  were  customarily  made  in  the  early  winter.  Having  made  his 
contracts  the  canner  buys  his  stock  of  cans,  packing  cases,  machinery,  labels,  and  such 
supplies  for  his  season's  pack.  Since  many  of  the  canners  are  men  of  small  means,  they 
find  it  necessary  to  borrow  most  of  the  money  for  these  purposes  from  the  local  banks. 
Before  loaning  the  money  the  banks  often  require  the  canner  to  assure  himself  of  a 
market  by  making  contracts  with  responsible  distributors  for  the  sale  of  his  commodity. 
Practically,  therefore,  the  canner's  pack  may  be  sold  before  the  crops  for  the  raw  product 
to  be  canned  have  been  planted.  The  Food  Administration  recognized  that  this  prac- 
tice was  the  outgrowth  of  unalterable  conditions  in  the  industry  and  that  it  served  as  a 
safeguard  both  for  the  farmers  and  for  the  canners.  The  usual  Food  Administration 
rules  prohibiting  future  contracts  more  than  60  days  in  advance  were,  therefore,  not 
applied  to  canners." 

1  The  tremendous  divergencies  in  the   costs  of  canning  vegetables,   for  example,   are 
emphasized  in  a  table  showing  the  range  for  plants  in  the  various  parts  of  the  country, 
included  in  the  Federal  Trade  Commission  Report,  ibid.     The  cost  of  packing  corn  ranged 
from  $0.65  to  $1.40  per  dozen  cans ;  tomatoes,  from  $0.60  to  $1.15  ;  and  peas,  from  $0.60 
to  $1.45. 

2  In  contrast  with  the  methods  of  price-fixing  used  for  commodities  other  than  food, 
the  following  clause  in  the  Food  Administration  regulations  for  canners  is  of  interest : 

"  Cost  shall  not  include  income  and  excess-profits  taxes  ;  interest  on  investments,  inter- 
est on  long-term  notes,  or  crop  hazards." 


GOVERNMENT   CONTROL   OVER   PRICES.  117 

margins  varied  from  15  cents  to  $1  per  dozen  cans,  according  to  the 
type  and  grade  of  the  vegetables  canned,1  and  were  believed  to  pro- 
vide a  profit  to  canners  large  enough  to  encourage  production.2 

Canned  fisfi. — The  declining  imports  of  sardines  and  the  govern- 
mental requirements  for  canned  salmon3  brought  the  1917  price  of 
these  types  of  fish  above  their  prewar  levels.  These  high  prices  were 
of  great  significance  to  the  Food  Administration,  especially  in  view 
of  the  meat  shortage,  and  immediate  action  wTas  taken  toward  the 
stablizing  of  prices. 

Sardines:  One  of  the  earliest  price  agreements  of  the  Food  Ad- 
ministration was  made  with  the  Maine  canners  of  sardines  in  October, 
1917,  before  the  canning  industry  came  under  license.  This  agree- 
ment called  for  a  maximum  price  of  $5.60  per  case  for  one-quarter 
oil  canned  sardines,  and  the  pack  of  1917  was  disposed  of  at  this 
price.  The  increased  costs  of  the  following  year,  however,  required 
a  revision  of  prices.  Since  the  Food  Administration  in  this  case, 
unlike  that  of  vegetables,  had  the  power  to  fix  a  price  for  the  "  raw 
material "  which  made  up  the  cost  of  the  pack,  it  was  decided  to 
determine  a  price  for  sardine  herrings.  The  fishermen  of  Maine 
were  called  together  in  April,  1918,  therefore,  and  a  price  of  $25 


1  Differentials  allowed  were  : 
Corn   (per  dozen  cans)  :  Cents. 

No.  2  standard 19 

No.  2  extra  standard 22 

No.  2  fancy 30 


Tomatoes   (per  dozen  cans)  :  Cents. 

No.    2    standard 18 

No.  2|  standard 22 

No.  3  standard 27 


No.  3  fancy 31 

No.  10  standard 90 

No.    10    fancy— 100 


Peas   (per  dozen  cans)  : 

No.    2    substandard,   average    all 

sizes : 15 

>To.  2  standard,  average  all  sizes.       22 

No.  2  fancy,  average  all  sizes 31 

It  will  be  noted  that  canned  beans  are  not  included  in  the  above  list.  This  was  due  to 
the  prohibition  placed  on  canning  beans  in  containers  made  of  tin  plate  without  a  special 
permit.  It  was  not  until  Nov.  1,  1918,  that  the  canning  of  beans  was  permitted,  and 
then  only  an  amount  equal  to  the  average  pack  for  the  three  months,  November,  Decem- 
ber, and  January. 

2  One  other  matter  should  be  mentioned  in  this  connection,  namely,  the  question  of  fu- 
ture contracts.  It  was  possible,  for  example,  that  on  making  delivery  of  certain  products 
several  months  after  figuring  out  preliminary  costs,  tlie  actual  cost  might  prove  smaller 
than  at  first  expected.  This,  of  course,  would  mean  a  higher  profit  than  allowed  by  the 
Food  Administration.  The  solution  of  this  problem  was  left  in  the  hands  of  the  packers 
themselves.,  as  described  by  Mr.  W.  C.  Mullendore,  ibid. 

"  The  canning  industry  felt  that  it  would  be  desirable  to  submit  to  the  Food  Adminis- 
tration these  future  contract  sales'  prices,  asking  the  Pood  Administration  to  sanction 
them  and  permit  them  to  proceed  in  the  confident  belief  that  these  prices  would  be 
acceptable  to  the  Food  Administration.  The  Food  Administration  was  unable,  however, 
to  state  what  would  be  reasonable  prices,  for  no  matter  how  accurate  an  estimate  of  cost 
may  be,  the  crop  is  not  determined  until  actually  put  up,  and  therefore  the  Food  Adminis- 
tration could  not  undertake  to  justify  canners'  future  contract  prices.  In  lieu  of  this 
method  each  canner  was  required,  before  invoicing  his  goods,  to  review  the  estimate  he 
had  made  of  his  costs,  and  if  it  were  determined  that  the  original  estimate  was  higher 
than  the  goods  were  proving  to  cost,  then  to  revise  downward  to  a  point  that  would  not 
provide  a  profit  in  excess  of  the  Food  Administration  maximum." 

3 10  per  cent  of  the  1917  salmon  pack  was  reserved  for  Army  and  Navy  needs ;  while 
of  the  1918  pack  80  per  cent  of  the  red,  75  per  cent  of  the  pink,  and  65  per  cent  of  the 
chum  Alaska  salmon  was  taken  over  by  the  Government. 


118 


HISTORY   OF   PRICES   DURING   THE   WAR. 


per  hogshead  was  established  as  the  maximum  price  to  be  paid  for 
raw  fish  by  the  packers. 

With  the  price  of  sardines  fixed,  it  was  relatively  a  simple  task  to 
agree  upon  a  price  for  the  canned  product.  After  an  investigation 
of -costs,  it  was  decided  that  a  price  of  $6.50  per  case  for  one-quarter 

oil,  ketyless,  and  $6.25  per  case 
for  one-quarter  mustard,  key- 
less, sardines,  would  provide  a 
reasonable  profit  to  the  canners, 
and  these  prices  were  fixed  as 
maxima  for  the  remainder  of 
the  season.1 

It  was  not  until  October,  how- 
ever, that  the  price  of  Califor- 
nia sardines  was  determined. 
A  series  of  three  prices  was 
agreed  upon,  varying  with  the 
size  of  the  raw  fish  to  be  sold:2 
and  on  the  basis  of  these  raw- 
fish  prices,  maxima  for  the 
canned  products  were  set.3 

Salmon:  Salmon,  of  course, 
played  the  most  important  part 
in  the  canned-fish  situation  of 
1918-19,  but  in  spite  of  this 
fact,  it  was  not  until  many 
months  after  the  price  of  sar- 
dines had  been  "  pegged  "  that 
salmon  canners  were  thoroughly 
controlled.  Speculation  h  a  d 
been  reduced  and  the  reason- 
able-profit rule  had  been  applied 
to  the  salmon  industry  back  in 
November,  1917,  but  lack  of  in- 
formation made  it  impossible  to 
fix  a  definite  price  until  well  along  in  1918.  The  price  of  the  fish  to 
the  fisherman  was  first  fixed,  the  output  for  Alaska,  Oregon,  and  the 
coast  streams  of  Washington  serving  as  the  basis.4  Packing  costs 

1  These  prices  also  were  applied  to  the  catches  of  the  Canadian  fishermen,  who  agreed 
to  accept  the  maximum  of  $25  per  hogshead  for  their  raw  fish. 

-  The  prices  for  raw  sardines  accepted  by  the  Food  Administration,  effective  for  the 
1918—19  season,  were  :  Under  7|  inches,  $30  per  ton  ;  over  7i  inchos,  $15  per  ton  ;  fish 
for  fertilizer  purposes,  $10  per  ton. 

3  The  maximum   canned  sardine  prices  per  cast-   agreed  upon   were  :   Tomato — Quarter 
round,   $3.25;    one-half  round,   $4;   ones  round,    $5.75:   OUPS   oval,   $7.25;   one-half  oval, 
$5.50.     Oil — quarter  round,   $3.25;   one-half  round,   $4.15;   ones   round,   $6. 

4  Prices   were   fixed    for    the    various    sections    of    Alaska   and    Washington,    while    the 
catch  of  the  Columbia  and  Rogue  Rivers  of  Oregon  was  differentiated  "into  several  types 
known  as  chums,  chinooks,  silver  sides,  and  steelheads. 


HBL/OTVC  PRICES  or 

CANNED  F15H 

SARDINES 

OtL.KCYLDS  (lOO-^  INCH  CWC) 

—  -SALMON 

PINK.TAU-,1  DOZEN  «1  CANS 

1.917       f     1916 

f  $8  f  U  & 

f 

iO> 
300 

( 

13 

BY  MONTHS 

JANUARY;  isis^DECEMBERtDta 

AVER  ACE  QUOTED  PRICES  JUK  ID13TUUNE,t£M'IOO 

mr 

r 

MO 

1915 

1914 

1915 

1916 

$  9  S. 

I  1  5  \ 

MM 

5  i  !j 

200 

ffi 

MX 

M/T 

/ 

J     1 

140 

t 

i 

r 

120 

100 

/ 

I- 

£ 

>\ 

400 

Dr 

I 

,> 

60 
60 

60 

A/ 

..!.,,.  .1.. 

,.i,.i,  ,i,. 

\i 

•  •  L1  •  L"  1  •  • 

1  .i..i.j.. 

OLuJ-uXu 

LLQ 

1  k  & 

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k  k  B 

I  Q 

1    i    fi 

ia»            1914 

1015 

1O16 

1917 

1915 

Relative     prices  —  Canned      fish  :      Sardines, 
oil,    keyless    (100-i    inch    case)  ;    and    Sal- 
mon,  pink,    tall,   one   dozen    No.    1    cans.  — 
By    months,    January,    1913,    to    December, 
1918.      (Average  quoted  prices,  July,   1913, 
to   June,    1914=100.) 

GOVERNMENT   CONTROL    OVER    PRICES,  119 

were  then  investigated  in  the  various  important  salmon-canning  sec- 
tions, and  on  the  basis  of  these  costs,  plus  the  prescribed  raw-fish 
prices,  maximum  prices  were  established  for  the  canned  stock.1 

Canned  Tuna :  Tuna  fish  prices  were  dealt  with  in  a  manner  similar 
to  sardines  and  salmon,  the  price  of  the  raw  fish  being  first  estab- 
lished. A  conference  of  the  Food  Administration  with  the  fishermen, 
resulted  in  the  fixed  price  for  all  raw  tuna  of  $100  per  ton.  Excep- 
tion was  made  in  the  case  of  two  types  known  as  Albacore  and  Blue 
Fin  tuna,  however,  and  for  these  an  extra  $10  per  ton  was  allowed. 
On  the  basis  of  these  figures,  pricey  were  determined  for  the  canned 
product,  and  the  latter  part  of  1918  found  the  price  situation  in  the 
tuna  fish  industry  in  a  more  stabilized  condition. 

Dried  fruits. — Preparers  and  packers  of  dried  peaches,  apples, 
prunes,  and  raisins  were  included  in  the  license  decree  of  October  8, 
191T.2  Significant  control  was  exercised  over  the  prices  of  these 
fruits,  although  the  primary  aim  of  the  Food  Administration  was 
apparently  the  checking  of  any  possible  speculation  in  the  industry. 
In  its  uncertain  character  this  industry  corresponds  closely  to  that  of 
the  canning  trade.  As  with  canned  goods,  it  was  necessary  to  limit 
as  much  as  possible  the  control  over  fruits  which  were  not  yet  on  the 
market,  and  thus  the  first  regulations  affecting  the  industry  prohib- 
ited "  either  the  purchase  or  sale  of  new-crop  fruits  for  spot  delivery 
before  May  1  of  the  year  in  which  they  were  to  be  packed."  : 

The  selling  price  of  the  various  fruits  wras  at  first  kept  under  sur- 
veillance by  a  regulation  requiring  licensees  who  shipped  in  carload 
lots  to  submit  to  the  Food  Administrator  all  price  lists  or  circulars 
relating  to  the  price  of  their  products ;  and  by  use  of  these  the  Dried 
Fruits  Division  kept  informed  as  to  the  tendency  of  prices  within  the 
trade.  This  system,  however,  did  not  result  in  as  effective  a  control 
as  was  desired,  and  in  its  place  a  method  of  price  control  similar  to 
that  used  in  the  canning  industry  was  adopted.  The  fruit  growers 
agreed  to  sell  their  peaches  to  the  packers  at  11  cents  per  pound. 
Similarly  the  raisin  price  was  fixed  at  5J  cents.  The  packers  were 
then  called  into  conference  and  a  schedule  of  maximum  prices  at 
which  their  products  would  be  sold  to  the  trade  was  adopted.4  A 
profit  limitation,  however,  was  also  placed  upon  the  packers  by  limit- 
ing their  returns  to  4  per  cent. 

1  The  complete  series  of  canned  salmon  prices  as  established  by  the  Food  Administration 
in  the  three  leading  salmon  sections  are  to  be  found  on  pp.  593-4. 

2  The  Dried  Fruits  Division  of  the  Food  Administration  originally  had  in  its  charge 
the  supervision  of  the  dried-fruit  industry.     It  was  later  consolidated  with  the   Canned 
Goods  Section  under  the  new  name  of  the  Canned  Goods  and  Dried  Fruits  Division. 

3  On  May  7,  1918,  the  date  at  which  purchases  of  new-crop  fruits  not  ready  for  spot 
delivery  could  be  made,  was  changed   to  June  1,  and  on  May  24  the  date  was  extended 
to  July  1. 

4  See  p.  596  for  schedule  of  agreed  fruit  prices. 


120 


HISTORY   OF   PRICES   DURING   THE    WAR. 


RELATIVE  pnices  OF 

RICC 

----  JAPAN  MEAD 
-  HONDURAS  MEAD 

PUFFED  R1CC 

•  "!  .....  flOAKER- 

BY  MONTHS 

JANUARY,  1913'°  DECEMBER.lOia 
AVERAGE 


But  this  method  of  price  regulation  was  applicable  only  to  the 
peach,  raisin,  and  prune  packing  industries,  since  the  centralization 
of  both  sources  of  supply  and  packing  plants  made  possible  a  system 
of  effective  supervision.  The  situation  was  different  in  the  case  of 
dried  apples,  for,  while  the  packers  were  under  license,  the  enormous 
number  of  apple  raisers  over  the  country  made  it  impossible  to  come 
to  a  price  agreement  with  any  considerable  number  of  growers.  The 
only  resort,  then,  was  the  regulation  of  packers'  profits,  and  as  in  the 

case  of  the  peach  and  raisin 
packer  on  the  Pacific  coast,  their 
return  was  limited  to  4  per  cent, 
The  results  of  control. — Early 
in  1919  restrictions  upon  tho 
canning  industry  were  removed, 
and  the  trade  once  more  re- 
sumed its  usual  business  prac- 
tices. It  appears  that  little 
change  was  made  in  the  level  of 
the  prices  of  the  various  canned 
commodities,  but  at  least  a  more 
stable  market  followed  the  inau- 
guration of  fixed  maximum  mar- 
gins. The  Food  Administration 
claims  that  its  price  regulations 
resulted  in  a  radical  revision  of 
contracts,  and  an  estimated  sav- 
ing to  the  American  consumers 
on  the  1918  pack  of  peas,  toma- 
toes, and  corn  alone  of  over 
$7,000,000.1 


Relative  prices. — Rice,  Japan  head,  and  Hon- 
duras head;  and  Tuffed  Rice,  Quaker. — By 
months,  January,  1913,  to  December,  1918. 
(Average  quoted  prices,  July,  1913,  to 
June,  1914=100.) 


RICE  AND  RICE  FLOUE. 


The  large  demand  for  cereals 
of  all  kinds  and  the  growing  im- 
portance of  rice  as  an  article  of  diet  was  reflected  in  the  price  tendency 
of  rice  after  our  entrance  into  the  war.  The  price  of  Japanese  rice 
rose  82  per  cent  in  the  two  months  March  to  May,  1917,  while  the 
Honduras  variety  increased  42  per  cent  in  the  same  period.  This 
upward  trend  continued  until  the  new  crop  appeared  in  October. 


1  See  W.  C.  Mullendore,  ibid. 


GOVERNMENT    CONTROL   OVER   PRICES;  121 

Then  prices  remained  relatively  stable  until  February,  1917,  the 
period  of  harvesting.  But  the  rise  was  resumed  then,  and  not  until 
the  Food  Administration  undertook  to  "peg"  the  price  of  rice  in 
July,  1918,  did  the  first  evidence  of  stability  appear. 

Control  over  the  industry.— Rice  became  a  substitute  for  wheat 
during  the  period  of  cereal  grain  shortage,  and  this  fact  had  weight 
in  determining  that  all  "importers,  manufacturers,  and  distributors  of 
rice  and  rice  flour"  should  be  licensed  under  the  presidential  procla- 
mation of  October  8,  1917.  At  the  very  beginning,  regulations  were 
inaugurated  which  limited  the  returns  to  rice  dealers,  and  licensees 
were  forbidden  to  sell  rough  rice  "at  an  advance  over  the  actual  price 
in  excess  of  1  per  cent  over  purchase  price,  plus  storage,  insurance, 
and  interest  on  the  investment  at  the  rate  of  6  per  cent  per  annum."1 

Resales  were  prohibited  so  as  to  prevent  speculation,  and  millers 
were  restricted  in  the  amount  of  rice  they  could  keep  on  hand.  Also, 
contracts  for  future  delivery  were  limited  to  30  days. 

But  the  limitation  upon  profits  of  rough-rice  dealers  and  the  elimi- 
nation of  speculation,  was  of  little  significance  as  a  factor  affecting 
rice  and  rice  products  prices,  in  view  of  the  tremendous  rice  demands 
of  1917  and  1918.  Even  in  the  summer  of  1917  our  supplies  of  rice 
were  beginning  to  feel  the  effects  of  the  wheat  shortage  and  the  de- 
mand for  wheat  substitutes,  both  foreign  and  domestic;  and  on 
August  1,  1917,  the  end  of  the  crop  year,  our  carry-over  of  rice  was 
but  approximately  one-half  of  that  of  the  preceding  year.  The 
stimulated  consumption  of  rice  during  the  spring  of  1918  at  the  en- 
couragement of  the  Food  Administration  still  further  accentuated 
the  situation,  and  August  1,  1918,  found  the  United  States  bare  of 
rice  supplies. 

The  price  agreement  of  the  summer  of  1918. — The  prices  of  rice 
continued  to  advance  through  1917  and  early  1918,  and  by  July  of 
1918,  it  was  realized  that  the  stabilization  of  rice  prices  was  neces- 
sary, and  the  rice  producers  and  rice  millers  of  the  country  were 
called  into  conference.2  The  final  solution  proved  to  be  a  system 
of  price  fixing  by  agreements  whereby  the  rice  millers  agreed  to  pay 
definite  prices  to  the  growers  of  rough  rice,  and  also  promised  not 

1  Commission   charges   of  agents  were  also   limited   to   1   per  cent.     The   "  reasonable- 
advance-over-cost  "  rule  was  applied  to  clean  rice  as  in  the  case  of  all  other  commodities. 

2  There  is  another  factor  quite  generally  overlooked  which  has  an  important  bearing 
upon  the  problem  of  fixing  rice  prices.     Imports  play  an  appreciable  part  in  the  rice 
supply  of  the  United   States,  and  in   1918  they  were   equal  almost  to  one-third  of  our 
production.     On  July  26  the  War  Trade  Board  announced  that  all  imports  of  rice  shipped 
from  foreign  ports  after  July  31  would  be  prohibited,  and   this  meant  that  our  supply, 
already  too  small,  would  be  further  cut  down. 


122  HISTORY   OF   PRICES   DURING  THE   WAR. 

to  sell  clean  rice  at  more  than  prices  named  in  the  agreement, L 
ranging  from  7§  cents  per  pound  for  choice  Japan,  to  9J  cents  for 
fancy  Honduras. 

On  this  basis,  with  the  broker's  margin  definitely  fixed;2  with  the 
millers'  maximum  price  of  rice  flour  fixed  by  the  Food  Administra- 
tion at  75  cents  per  100  pounds  above  the  purchase  price  of  brewers' 
rice  or  screenings;3  resales  prohibited;  and  a  maximum  margin  de- 
termined for  the  sale  of  rice  from  wholesalers  to  retailers,  it  was 
quite  evident  that  much  had  been  done  toward  the  stabilization  of 
rice  prices.  Indeed,  the  Food  Administration  went  so  far  as  to 
state  publicly  that  in  their  opinion  consumers  should  "be  able  to 
purchase  rice  at  a  price  of  approximately  10  to  12  cents  per  pound, 
depending  on  remoteness  from  the  milling  centers." 

The  method  of  price  regulation  adopted,  however,  required  super- 
vision, for  rough  rice  prices  were  based  on  grades,  and  the  decision 
as  to  how  a  certain  lot  of  rice  wras  to  be  graded  could  not  be  left  in 
the  hands  of  the  grower ;  nor,  on  the  other  hand,  could  the  grading 
be  intrusted  to  the  miller.  Accordingly,  a  general  committee  was 
appointed  to  accomplish  a  fair  valuation  of  the  grower's  product,  and 
to  these  men  was  left  the  task  of  supervising  and  carrying  out  the  con- 
tracts and  the  grading  and  valuing  of  rice  samples  submitted  by  the 
growers.4  Moreover,  in  order  equitably  to  allocate  the  rice  crop 
among  the  various  millers  of  the  country,  each  mill  was  allotted  a 
maximum  amount  which  it  might  purchase  of  the  1918  crop,  based 

1  The  prices  fixed  for  rough  rice  to  be  paid  to  growers  by  the  millers  were  as  follows  : 
$7.50  per  barrel  of   162   pounds  for  No.   1   and  No.  2   Honduras    (river  type)    in   sacks; 
$7.25  per  barrel  of  162  pounds  for  No.  3  Honduras  (river  type)   in  sacks;  $7  per  barrel 
of  162  pounds  for  No.  4  Honduras  (river  type)   in  sacks  :  $7.25  per  barrel  of  162  pounds 
for  No.  1  and  No.  2  Blue  Rose  in  sacks  ;  $7  per  barrel  of  162  pounds  for  No.  3  and  No.  4 
Blue  Ro.se  ip  sncks  ;  $7  per  barrel  of  162  pounds  for  No.  1  and  No.  2  Japan   in  sacks; 
$6.75  per  barrel  of  162  pounds  for  No.  3  and  No.  4.  Japan  in  sacks.     The  selling  prices 
of  the   products   secured   from   the  milling  of  rough   rice   were   agreed   upon   as  :    Fancy 
Honduras,  9£  cents  per  pound,  packed  in  100-pound  pockets  ;  choice  Honduras,  84  cents 
per  pound,  packed  in  100-pound  pockets  ;  fancy  Blue  Rose,  71  cents  per  pound,  packed 
in  100-pound  pockets ;  choice  Blue  Rose,  71  cents  per  pound,  packed  in  100-pound  pockets  ; 
fancy  Japan,  7»  cents  per  pound,  packed  in  100-pound  pockets  ;  choice  Japan,  73   cents 
per   pound,    packed    in    100-pound    pockets ;    fancy    second    heads,    6|    cents    per    pound, 
packed   in   100-pound   pockets;   screenings    (river),   61    cents   per   pound,   packed   in   100- 
pound  pockets  ;  screenings,  5§  cents  per  pound,  packed  in  100-pound  pockets  ;  brewers', 
5|  cents  per  pound,  packed  in  100-pound  pockets. 

2  Broker's  commissions  for  the  negotiation   of  the  sale  of  rice  or  rice  products  were 
limited  under  regulations  of  July  29  to:   (1)   7  cents  per  100  pounds  on  car-lot  orders, 
except  brewers'  rice,  sold  in  New  York,  San  Francisco,  Charleston,   Savannah.   Jackson- 
ville, St.   Louis,  Kansas  City,  Galveston,  and  Houston;    (2)    6  cents  per  100  pounds   on 
any  quantity  of  rice,  except  brewers'   rice,   sold   at  New  Orleans;    (3)    8  cents  per   100 
pounds   for   car-lot   orders,   except  brewers'   rice,   sold    at   any   other  point   except   those 
designated  in    (1)   and    (2)  ;    (4)    6  cents  per  100  pounds  for  brewers'   rice  sold  at  any 
point,  in  any  quantity  ;    (5)    25  cents  per  ton  on  rice  bran  or  rice  polish  at  any  point, 
in    any    quantity ;    (6)    6    cents    per   100    pounds    on    rice    flour    sold    anywhere,    in    any 
quantity. 

:i  The  quality  of  rice  flour  to  be  manufactured  was  specified  in  license  regulations. 
4  The  detailed  work  of  grading  and  evaluating  was  placed  in  the  hands  of  subcommit- 
tees, with  officers  in  the  various  cities  of  the  southern  rice  States  and  of  California. 


GOVERNMEXT    CONTROL   OVER   PRICES..  123 

on  its  individual  capacity  and  its  average  receipts  for  the  three  sea- 
sons 1915  to  1918.1  Provision  was  also  made  for  the  sale  of  clean  rice 
imported  as  such,  and  which  would  not,  therefore,  come  under  con- 
trol as  the  product  of  American  mills.  For  such  rice  a  maximum 
advance  of  10  per  cent  over  the  price  paid  by  the  importer,  plus 
freight  and  insurance,  was  allowed. 

It  would  seem  that  these  arrangements  resulted  in  marked  savings 
to  the  American  public,  from  a  study  of  the  price  tendency  of  the 
Japan  variety  of  rice  after  July,  1918.2  Honduras  head  rice  also 
shows  the  stabilizing  effect  of  the  price  agreement  of  1918.  This 
agreement,  incidentally,  is  still  in  force  (June  15,  1919)  and,  with  the 
exception  of  the  wheat  and  sugar  arrangements,  is  the  only  agreement 
of  its  kind  which  wras  extended  into  the  summer  of  1919. 

COAKSE  GRAINS  AND  FEED  STUFFS. 

Human  foods. — The  coarse  grains  were  among  the  many  commodi- 
ties which  felt  the  effects  of  the  stringent  wheat  shortage  of  1917. 
There  were,  moreover,  such  factors  as  the  small  carry  over  fronTthe 
1916  crop,  the  large  demand  by  distilleries,  and  the  small  crop  in 
Argentina,  which  played  an  important  part  in  sending  the  price  of 
individual  coarse  grains  such  as  com  to  levels  beyond  those  of  other 
commodities.3 

Corn,  oats,  rye,  and  barley  wrere  not  important  as  hunian  foods  in 
prewar  years,  but  took  their  chief  commercial  value  from  their  use  as 
feeding  stuffs  for  live  stock.  The  Food  Administration,  therefore, 
handled  them  in  connection  with  the  general  problem  of  mill  feeds. 
Storers,  distributors,  and  millers  of  rye  and  its  products  were 
included  in  the  first  presidential  proclamation  relating  to  licenses 
issued  August  14, 1917,  and  barley  and  barley  flour,  oats  and  oatmeal, 
corn,  corn  grits,  and  other  corn  products  such  as  glucose,  hominy, 
etc.,  were  added  on  October  8.4 

1  The  various  expenses  of  administration,  such  as  grading,  evaluating,  weighing,  super- 
vising contracts,  etc.,  were  to  be  borne  by  the  milling  interests  who  were  to  pay  to  the 
office  of  Food  Administration  Grain  Corporation  at  New  Orleans  a  fixed  fee  of  6!  cents  for 
each  barrel  of  rice  purchased. 

2  See  rice  chart,  p.  120. 

s  A  complete  record  of  tlie  prices  of  the  various  grains  can  be  found  in  the  bulletins 
"  Prices  of  Barley,  Hops,  Rye,  and  their  Products,"  "  Prices  of  Corn  and  Corn  Products," 
and  "  Oats,  Rice,  Buckwheat,  and  their  Products,"  in  the  W.  I.  B.  Price  Bulletin  Series. 

The  coarse  grains,  by  the  summer  of  1917,  had  in  several  cases  reached  unprecedented 
heights.  No.  3  yellow  corn,  in  June,  1917,  was  selling  for  $1.73  per  bushel,  and  in 
July  reached  a  level  of  $2.06,  as  compared  with  the  prewar  average  of  $0.685.  Similarly, 
barley,  which  in  the  prewar  months  averaged  $0.6243,  was  selling  in  the  summer  of  1917 
around  $1.40  ;  while  rye,  in  June,  1917,  was  selling  at  $2.36,  a  price  over  four  times  its 
peace  time  average  of  $0.5653. 

4  Later,  011  January  10,  1918,  all  importers,  manufacturers,  and  distributors  of  feeding 
stuffs  were  made  subject  to  license  by  presidential  proclamation,  thereby  bringing  all  the 
products  of  coarse  grains  under  license  regulation. 


124  HISTORY   OF   PRICES   DURING  THE   WAR. 

It  was  evident  from  the  beginning  that  speculation  in  these  coarse 
grains  must  be  eliminated,  else  the  instability  of  the  preceding 
months  would  recur.  At  the  request  of  the  Food  Administration, 
speculation  on  the  grain  exchanges  had  been  virtually  stopped  in 
August.  But  the  elimination  of  speculation  meant  much  more  than 
the  closing  of  exchanges.  Indeed,  it  meant  that  not  only  must  the 
amount  of  grain  which  any  individual  should  be  allowed  to  hold  be 
fixed,  but  that  a  limit  must  be  set  upon  the  length  of  time  during 
which  a  licensee  might  keep  his  grain.  The  first  regulations  which 
were  applied  to  licensees,  therefore,  forbade  the  holding  or  storing 
of  grains  for  more  than  30  days.1 

But  the  prohibition  of  speculation  did  little  to  keep  in  check 
the  soaring  tendencies  of  the  various  grains  and  their  products, 
for,  with  the  coming  of  the  severe  winter  of  1917-18  and  the  tie-up 
of  railroad  transportation,  the  consequent  shortage  of  supplies  sent 
the  price  of  these  foodstuffs  far  above  their  prelicense  level.  The 
conservation  rules  of  the  Food  Administration,  moreover,  required 
the  buying  of  wheat  substitutes  with  each  purchase  of  wheat.  This 
step,  naturally,  created  an  extraordinary  demand  for  coarse  grains 
and  pushed  their  prices  upward. 

The  creation  of  the  Grain  Division. — Conditions  were  becoming- 
acute,  and  on  April  1,  1918,  the  Food  Administration  created  its 
Grain  Division  and  gave  it  oversight  of  the  coarse  grain  problem. 
The  first  act 'of  this  division  was  the  opening  of  the  grain  exchanges 
to  legitimate  hedging  operations.  It  also  permitted  speculative 
accounts  limited  to  200,000  bushels,  so  as  to  keep  the  market  open 
and  thus  stabilize  prices.2 

A  plan  was  needed,  however,  for  the  definite  pegging  of  prices, 
and  with  this  in  view  a  system  of  weekly  reports  was  inaugurated 
by  which  every  coarse  grain  miller  and  every  feed  dealer  advised 
the  Food  Administration  of  the  exact  cost  of  his  raw  materials  and 
the  exact  selling  price  of  his  manufactured  products.  The  Grain 
Division  in  this  way  informed  itself  of  margins  of  profit.  These 

1  This  regulation  made  it  illegal  to  hold  or  store  rye  at  any  point  for  more  than  30 
days.    As  regards  the  other  coarse  grains,  this  prohibition  applied  only  to  seaboard  points, 
but  at  such  points  not  only  was  storage  limited  to  30  days,  but  such  grains  which  had 
been  received  on  or  before  Sept.  1,  1917,  could  not  be  held  for  a  period  longer  than  5 
days  after  regulations  became  effective  (Nov.  1). 

2  With  the  grain  exchanges  virtually  closed  and  no  means  of  hedging,  it  was  impos- 
sible for  millers  and  dealers  to  protect  themselves  against  future  price  falls.     In  other 
words,  they  could  not  sell  on  "  futures,"  to  be  delivered  at  a  later  date,  and  had  no  as- 
surance of  a  profit  at  the  time  of  delivery.    What  they  did  then  was  to  charge  a  high  mar- 
gin for  those  sales  of  actual  grain  on  hand  which  they  did  make,  and  in  that  way  try  to 
eliminate  any  possible  loss  which  might  result  in  the  future,  due  to  a  fall  in  prices.     (See 
final  report  of  Food  Administration,  ibid.) 

It  is  of  interest  to  note  that  later  regulations  provided  for  losses  or  gains  from  hedging 
"  on  any  recognized  grain  exchange  "  in  arriving  at  the  cost  of  corn,  oats,  rye,  and  barley, 
in  interpreting  the  "  reasonable-advance-over-cost  "  rule. 


GOVERNMENT   CONTROL   OVER   PRICES. 


125 


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126 


HISTORY  OF   PRICES   DURING   THE   WAR. 


reports  were  regularly  and  minutely  checked,  and  as  an  example  of 
the  results  obtained  from  this  system  it  is  interesting  to  note  that 
in  the  single  month  of  June  the  question  of  price  reduction  was 
taken  up  with  204  mills,  95  of  whom  as  a  result  lowered  the  price 
of  their  products.  The  savings  effected  because  of  the  orders  of 
the  division  to  reduce  prices  in  June  alone  have  been  estimated  to 
equal  $175,000.  * 

The  limitation  of  coarse  grain  millers*  prices. — After  digesting 
these  reports  for  several  months,  the  grain  division  prescribed  on  July 
20,  1918,  with  the  aid  of  the  industry,  a  series  of  maximum  margins 
to  be  added  to  costs  in  determining  the  prices  to  be  charged  for  the 
various  grain  products.2  Moreover,  a  definite  limitation  of  6  per 
cent  was  placed  on  profits  of  millers  from  gross  sales  of  the  edible 
products  of  the  various  coarse  grains  for  any  six-month  period. 

The  profits  of  the  manufacturers  of  coarse  grain  products  were 
thus  limited  to  reasonable  bases,  and  it  remained  to  fix  specific  mar- 
gins on  returns  of  grain  dealers  and  elevator  operators  from  whom 
these  manufacturers  secured  their  supplies.3 

The  formulation  of  definite  profit  limitations  soon  appeared  de- 
sirable, and  regulations  were  issued  on  September  10  fixing  the  maxi- 
mum net  profits  for  "  any  grain  dealer,  including  country  elevators 
dealing  in  grain,  to  3  per  cent  of  the  first  $300,000  of  the  gross  sales 
per  annum,  (and)  2  per  cent  on  all  gross  sales  in  excess  of  $300.000 
per  annum,"  thereby  providing  a  system  of  regulation  for  virtually 
the  entire  coarse  grain  industry ;  excepting  the  farmer,  whose  returns 
were  beyond  the  powers  of  the  Food  Administration. 

1  Similarly,  price  reductions  in  July  netted  $116,000.  An  idea  of  the  range  of  price 
reductions  will  be  gained  from  the  following  table  taken  from  the  Monthly  Report  of  the 
Activities  of  the  Grain  Division  of  the  United  States  Food  Administration  for  June,  1918  : 

Reductions  per  100  pounds. 


Low. 

High. 

Low. 

High. 

Meal 

$0  11 

$0.80 

Hominy 

$0.50 

$0.50 

Flour  

.05 

.83 

Grits  

.30 

.30 

Price  reductions  in  July  varied  from-$2  per  ton  for  gluten  feed  to  $17.25  per  ton  for  linseed  meal. 

2  The  following  differentials  (in  cents  per  hundred  pounds  bulk  product)  were  promul- 
gated :  Old-fashioned  or  water-ground  meal,  50  ;  standard  and  bolted  meal,  50  ;  pearl  meal, 
60  ;  pearl  or  table  hominy,  80  ;  grits,  80  ;  cream  meal,  80  ;  Ceraline  flakes,  120  ;  corn  flour, 
100  ;  other  cornmeal,  60  ;  barley  flour,  95  ;  rye  flour,  90  ;  rolled  oats,  oatmeal,  oat  flour, 
90.  It  should  be  noted  that  these  prices  were  bulk  prices  for  grains  packed  in  barrels, 
or  100-pound  jute  or  cotton  bags,  and  did  not  apply  to  products  sold  in  packages.  For 
corn  meal,  corn  grits,  hominy,  corn  flour,  barley  flour,  and  rye  flour  sold  in  packages,  a 
series  of  differentials  over  and  under  the  bulk  price  were  drawn  up.  The  maximum  price 
per  pound  for  hominy  feed,  hominy  meal,  hominy  chop,  barley  feed,  rye  feed,  or  oat  feed 
produced  as  a  by-product  of  manufactured  edible  corn,  barley,  rye,  or  oat  products,  could 
not  be  more  than  the  "  purchase  price  per  pound  of  the  grain  from  which  ft  was  manufac- 
tured." 

8  The  reasonable-advauce-over-cost  rule,  of  course,  applies  to  dealers  and  mill  operators. 


GOVERNMENT    CONTROL   OVER    PRICES,  127 

Feeding  stuffs. — The  profits  of  feed-stuff  producers  were  fixed  in 
December,  1917,  when  a  series  of  differentials  was  announced  on 
various  wheat  feeds.1  In  July,  1918,  further  differentials  were  an- 
nounced for  wheat  feeds  in  less-than-carload  lots  and  individual 
maximum  margins  were  designated  for  sales  by  millers  to  wholesale 
and  retail  feed  dealers.  Indeed,  a  fair-price  schedule  based  on  the 
Government  wheat  price  was  drawn  up  and  submitted  to  each  mill 
and  on  the  basis  of  the  schedule  millers  were  to  sell  their  wheat 
feed. 

The  maximum  return  of  6  per  cent  on  total  gross  sales  was  made 
applicable  also  to  the  manufacturer  of  mixed  feeds.  A  considerable 
margin,  however,  was  allowed  him  on  individual  sales  equaling  a 
return  of  12J  per  cent  on  the  cost  of  materials,  manufacturing,  and 
overhead.  This  maximum  margin,  it  appears,  was  made  wide  "be- 
cause of  the  speculative  character  of  the  products  which  went  into 
the  manufacture  of  mixed  feeds,  and  the  rapidly  fluctuating  prices 
which  might  prevail." 

Dealers,  on  the  other  hand,  were  allowed  a  still  larger  margin  on 
individual  sales,  and  for  them  a  maximum  15  per  cent  over  the 
purchase  price  was  considered  a  fair  return.  Moreover,  their  annual 
earnings  were  also  limited  and  a  yearly  net  profit  "  by  any  whole- 
sale dealer  in  feeding  stuffs  of  more  than  4  per  cent  on  total  gross 
sales,  if  his  gross  sales  of  feeding  stuffs  amounted  to  $100,000  *  *  * 
per  annum  was  considered  prima  facie  evidence  of  a  violation  of  the 
rule  which  prohibited  the  taking  of  unreasonable  profits."  - 

Feeds  oilier  than  coarse  grains  and  their  products, — -There  are 
other  important  feed  stuffs  which  can  not  be  properly  classified 
under  coarse  grains,  but  which  play  an  important  part  in  the 
American  live-stock  industry.  These  grains  were  all  controlled  to 
some  extent,  and  definite  Drice  regulations  were  applied  to  their 
sales. 

Eice  feed  was  provided  for  under  the  agreement  with  the  rice 
industry  mentioned  in  preceding  pages,  whereby  all  rice  millers 
agreed  to  sell  rice  polish  at  a  price  not  to  exceed  $50  per  ton,  car  lots, 
f.  o.  b.  mill,  and  rice  bran  at  a  maximum  of  $36. 

Beet  pulp,  an  important  by-product  of  the  beet-sugar  industry, 
was  definitely  controlled  as  to  price,  and  the  following  were  con- 
sidered as  maxima  which  would  return  a  fair  margin  of  profit  to  the 
beet-sugar  manufacturer : 

1  See  schedule  of  margins  on  wheat  feeds  on  p.  r>82. 

3  The  above  rules  did  not  apply  to  wheat-mill  feeds,  or  the  feeds  which  are  discussed  im- 
mediately below.  In  these  cases,  however,  where  wheat-mill  feeds,  cottonseed  products, 
rice  polish  and  bran,  or  dried  beet  pulp  were  sold,  as  well  as  other  feeds,  the  4  per  cent 
was  calculated  on  all  sales. 


128  HISTORY   OF   PRICES   DURING  THE   WAR. 

Wet  beet  pulp,  bulk,  mill  (car  lots) per  ton $0.80 

Wet  beet  pulp  out  of  silo,  bulk,  mill  (car  lots) do 1.25 

Dried  beet  pulp,  sacked,  f.  o.  b.  factory  (car  lots) do 40.00 

The  price  regulation  for  cottonseed  meal  has  been  dealt  with  in  the 
chapter  on  "Cottonseed  and  its  products."  Definite  prices  were 
fixed  for  meal  and  cake  in  various  sections  of  the  country,  while  hulls 
were  to  be  sold  at  $20  per  ton,  bulk,  f .  o.  b.  points  of  manufacture. 

COFFEE. 

The  outbreak  of  war  in  July,  1914,  followed  by  the  allied  block- 
ade and  the  cutting  off  of  supplies  from  central  Europe,  had  its 
effect  upon  the  price  of  coffee,  which  in  former  years  had  found  a 
large  market  among  the  peoples  of  the  Central  Powers.  With  the 
elimination  of  these  markets  and  with  the  constantly  tightening  em- 
bargoes of  the  allied  countries  to  conserve  shipping  space,  the  United 
States  soon  became  virtually  the  only  large  coffee-consuming  country. 
But  it  became  evident  that  we  could  not  absorb  the  total  production 
of  the  coffee-raising  countries.  The  nature  of  the  coffee  industry,  on 
the  other  hand,  made  impossible  the  cutting  down  of  production  to 
a  degree  commensurate  with  the  decline  in  demand.  The  result  was 
that  throughout  1915,  1916,  and  the  greater  part  of  1917,  coffee  sold 
on  American  markets  at  a  figure  appreciably  lower  than  the  average 
for  the  prewar  years. 

The  coffee  growers  of  Brazil,  however,  set  about  to  get  a  price 
somewhat  in  relation  to  other  commodities.  The  natural  operations 
of  the  market  provided  no  relief,  and  since  it  wras  apparent  that  arti- 
ficial methods  would  be  necessary,  a  plan  which  had  been  found 
practicable  before  was  once  more  put  into  effect.  This  plan  was  the 
valorization  scheme,  whereby  the  Government  bought  up  as  much 
coffee  as  was  necessary  to  stabilize  the  market.  This  undertaking  by 
the  State  of  Sao  Paulo  in  Brazil  evidently  brought  little  immediate 
results;  yet  later  developments  showed  that  it  had  exerted  some 
effect  upon  the  coffee  dealers  of  the  United  States.  Moreover,  the 
fact  was  emphasized  by  interested  parties  that  coffee  was  relatively 
cheap  and  that  any  sudden  termination  of  hostilities  would  have  an 
important  effect  upon  coffee  values  by  opening  the  European 
markets. 

Governmental  interference. — The  coffee  propaganda  was  making 
itself  felt  by  the  fall  of  1917  upon  the  speculators  and  dealers  in 
coffee  futures  and  coffee  prices  started  upward  in  this  country.  By 
January,  1918,  the  prewar  price  was  reached,  and  the  Food  Adminis- 
tration soon  realized  that  Government  interference  was  necessary. 
On  January  30,  1918,  all  dealers  in  green  coffee  were  instructed  to 
secure  licenses  from  the  Food  Administration. 


GOVERNMENT   CONTROL   OVER   PRICES.  129 

Price  control  was  the  immediate  occasion  for  this  action  and  the 
first  regulations  promulgated  had  a  direct  bearing  on  sales  and  re- 
turns. On  February  6,  1918,  two  days  after  the  license  regulations 
went  into  effect,  all  purchases  and  sales  of  green  coffee  on  the  New 
York  Coffee  and  Sugar  Exchange  for  delivery  during  the  month  of 
February  were  limited  to  a  maximum  price  of  8-J-  cents  per  pound 
for  the  standard  grade,  type  No.  7.  On  purchases  which  were  to 
be  delivered  after  the  month  of  February,  there  were  allowed  an 
additional  carrying  charge  of  $0.0015  for  each  month  on  each  pound 
of  coffee.  Thus  the  maximum  spot  price  of  coffee  on  the  exchange 
was  fixed  at  8J  cents.  This  action  made  it  relatively  simple  to  pro- 
vide for  the  control  of  the  individual  dealers,  in  whose  hands  lay 
the  distribution  of  coffee. 

Provision  was  made  immediately  for  the  control  of  the  coffee  re- 
turns by  the  general  rule  of  fixed  percentages  over  cost.  Importers 
were  given  the  right  to  charge  2J  per  cent  per  pound  over  costs1 
while  jobbers  were  allowed  a  maximum  of  5  per  cent  over  cost.2 

Licensees  were  instructed  to  keep  their  supplies  moving  in  as 
direct  a  line  to  the  consumer  as  practicable,  and  without  unreasonable 
delay.  Resales  were  restricted,  especially  when  tending  to  result  in  a 
higher  price  to  the  retailer  or  consumer.  However,  when  there  was 
a  reasonable  justification  for  resales  they  were  permitted  at  certain 
fixed  rates.3  The  stocks  of  any  member  of  the  trade,  moreover,  were 
limited  to  90  days  requirements. 

In  spite  of  regulations  limiting  returns  and  the  restricting  of  sales 
on  the  Coffee.  Exchange  to  certain  prices,  many  difficulties  occurred 
which  gave  trouble.  They  lay  primarily  with  the  rules  limiting  the 
transactions  on  the  exchange.  The  maximum  spot  price  had  been 
fixed,  and  this  maximum  price  which  was  the  same  for  each  month 
was  always  reached.  This  rule  effectively  stopped  speculation,  but 
seemed  not  to  take  account  of  certain  customs  of  the  trade.  Many 
dealers  had  hedged  their  stocks  on  the  exchange,  hoping  to  buy  back 
their  hedging  sales  later  when  deliveries  were  due.  But  when  such 
time  came  apparently  they  could  not  buy  back  these  sales  since 
holders  of  coffee  refused  to  sell  at  the  fixed  maximum  prices.  The 
actual  stocks,  therefore,  were  not  released  to  the  trade.  By  October 

I  In    arriving   at    cost,    the    licensee    could    take    into    consideration    the    gain    or   loss 
resulting  from  a  single  actual  hedging  transaction  on  the  Coffee  Exchange. 

II  On  July  24,   1918,   an   amendment  to  the  regulations  increased   the   maximum  profit 
allowance  to  5  per  cent  for  importers  and  1\  per  cent  for  jobbers. 

3  Returns  on  sales  from  one  importer  to  another  were  limited  to  \\  per  cent  over 
cost,  and  on  sales  from  one  jobber  to  another  profits  were  fixed  at  a  maximum  of  2|  per 
cent  over  cost.  These  were  increased  on  July  24,  1918,  to  2*.  and  31  per  cent,  respectively. 

125547° —20 9 


130  HISTORY   OF   PRICES   DURING   THE   WAR, 

the  situation  became  acute  and  many  outstanding  orders  remained 
unfilled.1 

The  closing  of  the  Coffee  Exchange. — Finally,  on  October  28,  the 
board  of  managers  of  the  Coffee  Exchange  suspended  trading  in 
futures.  This  action,  it  was  explained,  was  prompted  by  advances 
of  coffee  in  the  Brazilian  market  above  the  price  fixed  in  this  coun- 
try. In  the  meantime  negotiations  had  begun  between  the  Food  Ad- 
ministrator and  the  War  Trade  Board  relative  to  a  solution  of  the 
problem,  and  on  October  14  the  announcement  was  made  that  "no 
licenses  for  the  importation  of  coffee  would  be  issued  except  to  the 
United  States  Sugar  Equalization  Board."  This  action  was  taken 
to  adjust  coffee  imports  with  shipping  conditions,  to  effect  an  equi- 
table distribution  to  the  trade,  and  to  insure  the  supplies  necessary 
for  home  consumption.  This  action  seemed  a  solution  both  for  the 
tie-up  in  stocks  which  were  being  held  under  long-term  contracts  and 
for  the  high  price  in  the  Brazilian  market.  But  the  Food  Admin- 
istrator wanted  to  release  all  stocks  in  this  country,  and  on  November 
1  ordered  that  all  coffee  futures  be  liquidated  at  the  maximum  price 
before  November  9.  He  further  prohibited  new  operations  and 
transactions  on  the  exchange  after  November  2.  The  Coffee  Ex- 
change resumed  operations  in  order  that  contracts  in  force  might  be 
closed  out,  and  by  November  9  all  deliveries  of  coffee  on  future  con- 
tracts were  completed  and  the  trade  secured  the  necessary  supplies 
of  coffee.  All  regulations  of  the  Food  Administrator  were  removed 
on  December  31,  1918. 

COLLATERAL  COMMODITIES. 

The  Food  Administration  undertook  control  not  only  of  food- 
stuffs but  also  of  commodities  intimately  related  with  the  production 
of  foods.  Ammonia  and  arsenic  were  intimately  related  to  the  con- 
servation of  foods,  while  ice  and  twine  affected  the  ultimate  price 
of  foodstuffs  to  the  consumer.2 

Ammonia. — The  part  which  refrigeration  plays  in  the  preserva-. 
tion  of  foodstuffs  made  ammonia  a  logical  commodity  for  Govern- 
mental oversight.  Moreover,  there  were  the  demands  for  ammonia 
for  fertilizers  and  for  the  manufacture  of  explosives.  The  1918 

1  The  following  statement  issued  by  the  Food  Administration  on  the  occasion  of  closing 
the  Coffee  Exchange  shows  well  the  condition  of  affairs  at  the  time  :  "  It  had  been  found 
that  several  houses  operating  for  foreign  account  bought  coffee  futures  upon   the  New 
York  Coffee  and  Sugar  Exchange  to  the  amount  of  several  hundred  thousand  bags.     The 
sellers    have   sold   against    coffee    in   stock   and    en   route.      The   effect   is   to   tie  up   this 
coffee  from  distribution   for  many  months,    and  to   necessitate   extra   tonnage  being   em- 
ployed if  our  supplies  are  to  be  maintained." 

2  The  Division  of  Miscellaneous  Commodities,  created  immediately  after  the  establish- 
ment   of    the    Food    Administration,    at    first    handled    some    of    those    extra-food    com- 
modities.     Later    this    body    merged    with    the    Division    of    Chemicals    which    also    had 
supervision  over  nonfood  materials,  and  both  together  were  known  as  the  Division  of 
Collateral  Commodities. 


GOVERNMENT   CONTROL   OVER   PRICES. 


131 


requirements  of  the  Ordnance  Department  for  ammunition  alone 
were  greater  than  the  entire  domestic  production  of  ammonia  for 
the  preceding  year.1  Further  an  important  part  of  the  American 
supply  of  ammonia  had  formerly  been  imported.  The  shortage  of 
shipping  had  already  cut  down  imports,  and  there  was  in  prospect 
a  still  further  cut  during  1918.2 

The  needs  of  the  situation  were  foreseen  early  by  the  Food  Admin- 
istration, and  even  before  the  ammonia  industry  was  put  under 
license  a  system  of  effective  agreements  was  devised.  The  ammonia 
manufacturers  were  called  into  conference  and  an  agreement  was 
made  whereby  the  allocation  of  the  American  output  of  ammonia 
was  put  into  the  hands  of  the  Food  Administrator.  He  in  turn 
appointed  the  interdepartmental  ammonia  committee,  upon  whom 
devolved  the  task  of  distributing  the  ammonia  supply  and  deter- 
mining the  supervision  of  allotments.3 

A  further  agreement  on  the  part  of  manufacturers  obliged  them 
not  to  sell  anhydrous  ammonia  for  more  than  30  cents  per  pound,  car- 
load lots,  and  aqua  ammonia  for  more  than  8J  cents,  carload  lots. 

These  informal  controls  came  before  the  ammonia  industry  was 
brought  under  license.  The  agreement  discussed  above  was  made  on 
November  19,  191T.4  The  advantages  to  be  gained  from  the  complete 
control  of  the  ammonia  industry,  however,  led  to  the  licensing  of  the 
importers,  manufacturers,  and  distributors  of  ammonia,  ammoniacal 
liquors,  and  ammonium  sulphate  by  a  proclamation  of  January  3, 
1918. 

Ice. — Many  conservation  measures  were  put  into  effect,  the  most 
important  of  which  was  a  campaign  for  the  shutting  down  of  artificial 
ice  plants  during  the  winter  months  and  the  utilization  of  natural 
ice.  Artificial  ice  manufacturers  were  asked  to  use  the  least  possible 
amounts  of  ammonia  and  manufacturers  were  instructed  to  supply 
ammonia  to  concerns  only  in  such  quantities  as  would  permit  them  to 

1  See  final  report  of  Food  Administration  1918,  ibid, 

2  As  shown  in  the  appended  ^table,  based  on  data  from  the  United  States  Department 
of  Commerce,  American  imports  of  ammonia   (muriate)   suffered  a  large  decrease  during 
the  early  years  of  the  war.     Receipts  for  1917  were  loss  than  half  the  size  of  those  of 
1913,  while  the  acute  situation  of  1918  virtually  eliminated  them : 


Calendar  year. 

Pounds. 

Calendar  year. 

Pounds. 

Calendar  year. 

Pounds. 

1913... 

9,019,418 

1915 

2  542  592 

1917 

2  146  549 

1914  

7  841  546 

1916 

1  653  354 

1918 

'  284*  904 

3  This  committee  was  made  up  of  representatives  of  the  War  Department,  Navy 
Department,  Department  of  Agriculture,  Department  of  the  Interior,  the  War  Industries 
Board,  and  the  Food  Administration. 

*  Although  the  licensing  of  the  ammonia  industry  was  put  into  the  hands  of  the 
Food  Administration,  the  enforcement  of  the  regulations  promulgated  was  theoretically 
intrusted  to  the  Department  of  Agriculture.  However,  the  interdepartmental  ammonia 
committee  really  enforced  the  rules  which  were  put  into  effect. 


132  HISTORY   OF   PRICES   DURING   THE    WAR. 

operate  their  plants  with  a  maximum  degree  of  efficiency.  Moreover, 
monthly  consumption  reports  were  required  from  each  ice  and  refrig- 
eration plant  by  means  of  which  a  careful  check  was  kept  upon  con- 
sumption. Where  there  appeared  undue  use  by  a  concern,  the  manu- 
facturer who  supplied  the  ammonia  was  notified  to  refuse  to  make 
further  deliveries  unless  evidence  was  furnished  that  wasteful  meth- 
ods would  be  discontinued. 

The  efficacy  of  the  price  control  over  ammonia  seems  striking 
after  comparing  the  price  of  ammonia  in  the  year  1918  with  prices  in 
general.  The  extraordinary  feature  of  the  control  is  that  a  stable 
price  was  maintained  during  a  season  "  at  the  outset  of  which  we  were 
faced  with  an  apparent  shortage  of  60,000,000  pounds."  This  control 
is  notable  in  the  degree  of  informal  control  which  obtained  before 
ammonia  was  put  under  license.  The  price  of  ammonia,  liquid,  an- 
hydrous, in  cylinders,  at  New  York,  held  at  25  cents  per  pound  during 
the  war  until  August,  1917,  when  it  rose  to  30  cents  and  stayed  there 
through  1918. 

The  conservation  measures  inaugurated  in  the  refrigerating  and 
ice-producing  industries  in  the  winter  of  1917-18  resulted  in  harvest- 
ing more  natural  ice,  and  the  spring  of  1918  found  one  of  the  largest 
ice  crops  ever  stored  in  the  United  States.  There  was  no  reason  to 
fear  any  acute  shortage  then,  but  because  of  the  importance  of  ice  to 
the  food  program  it  was  deemed  advisable  to  see  that  ice  prices  did 
not  exceed  a  nominal  level  in  the  various  parts  of  the  country.  The 
industry  was  never  put  under  license,  but  supervision  was  maintained 
throughout  the  summer  of  1918.  It  was  obviously  impossible  for  the 
central  office  of  the  Food  Administration  to  administer  control  over 
the  almost  limitless  array  of  ice  distributors,  especially  when  no  one 
of  them  was  subject  to  any  direct  regulations,  and  when  no  one  of 
them  made  any  reports  as  to  his  methods  of  doing  business  or  as  to 
the  prices  charged  for  his  commodity.  The  supervision  over  ice 
prices  was  placed  in  the  hands  of  the  Federal  food  administrators 
for  the  various  States,  with  instructions  that  they  keep  under  con- 
trol the  ice  prices  in  their  industrial  districts.  Price  increases  were 
investigated  by  these  officials,  and  with  them  was  left  the  task  of 
determining  the  reasonableness  of  price  advances  in  the  territory 
that  came  under  their  jurisdiction.  The  theory  applied  in  making 
such  decisions  was  that  "  as  far  as  possible  the  burden  of  any  neces- 
sary increase  should  fall  upon  the  large  users  rather  than  upon  the 
small  household  consumer."  1 

Arsenic. — The  extraordinary  demands  for  insecticides  in  the  pro- 
duction of  which  the  greater  part  of  the  domestic  output  of  arsenic 
is  consumed,  together  with  the  needs  of  glass  producers,  resulted  in 

1  Final  report  of  the  Food  Administration,   1918. 


GOVERNMENT    CONTROL   OVER   PRICES.  133 

a  spectacular  rise  in  the  price  of  arsenic  even  before  the  United  States 
entered  the  war.  Under  the  stimulus  of  this  large  demand  the  Amer- 
ican production  of  arsenic  increased  rapidly  during  the  war,  and  in 
1917  the  output  amounted  to  6,151  tons,  as  against  2,513  tons  in  1913, 
an  increase  of  approximately  150  per  cent.  But  this  increased  output 
was  by  no  means  commensurate  with  the  growing  demands  of  the 
country,  and  by  late  1916  a  shortage  was  threatening.  In  December, 
1916,  arsenic  was  selling  at  a  price  134  per  cent  higher  than  the  aver- 
age prewar  level.  The  American  entrance  into  the  war  accentuated 
the  difficulties  of  the  situation,  and  arsenic  prices  began  soaring  to 
unprecedented  levels.  By  September,  1917,  arsenic  had  reached  a 
point  481  per  cent  above  its  average  for  1913-14. 

Apart  from  the  rise  in  price,  moreover,  the  insecticide  producers 
were  complaining  of  their  inability  to  secure  arsenic.  This  condition 
had  a  direct  bearing  upon  the  food  situation,  and  on  November  15  a 
proclamation  was  issued  which  required  all  those  engaged  in  im- 
porting, manufacturing,  storing,  and  distributing  white  arsenic  or 
engaged  in  the  manufacture  of  insecticides  containing  arsenic  to  take 
out  licenses  within  five  days.  Regulations  were  issued  similar  to 
those  which  were  promulgated  in  the  case  of  foodstuffs,  and  provi- 
sions were  made  for  the  securing  of  reports  from  licensees  which 
showed  the  state  of  affairs  in  the  industry.  Measures  were  also  en- 
forced which  aimed  at  the  elimination  of  hoarding,  the  prohibition 
of  unreasonable  profits,  the  prevention  of  waste,  and  the  diversion  of 
arsenic  from  less  to  more  essential  uses ;  and  sales  to  others  than 
manufacturers  of  insecticides,  medicines,  and  such  products  as  were 
required  by  the  United  States  Government  were  forbidden,  unless 
specially  authorized  by  the  Food  Administration.1  Moreover,  the 
price  situation  was  immediately  investigated,  and  on  February  23  the 
producer's  price  of  white  arsenic  was  virtually  fixed  at  a  maximum  of 
9  cents  per  pound  delivered  at  any  point  in  the  United  States  in  car- 
load lots.2  This  price  was  a  cut  of  almost  50  per  cent  from  the  market 
price  of  16.5  cents  for  the  preceding  month.  It  appears,  however,  that 
this  new  low  price  was  not  reflected  universally  in  the  consumer's 
price,  since  they  were  known  to  be  paying  as  high  as  30  cents  per 
pound  for  small  lots.3 

The  trade  was  therefore  notified,  on  April  4,  that  the  price  of  arse- 
nic to  the  consumers  would  have  to  be  considerably  lowered,  and  a 
margin  of  one-fourth  cent  per  pound  was  declared  to  be  a  fair  return 

1  This  latter  regulation,  it  will  be  noted,  made  it  illegal  to  sell  arsenic  without  permis- 
sion of  the  Food  Administration  to  glass  producers,  who  were  normally  large  consumers. 

2  An  extra  half  cent  per  pound  was  allowed  for  less  than  carload  lots. 

3  Review  of  Control  of  Arsenic  and  Arsenical  Insecticides.    Files  of  U.  S.  Food  Adminis- 
tration. 


134  HISTORY   OF    PRICES    DURING    THE    WAR. 

to  dealers  who  sold  in  carload  lots.    In  this  way  the  selling  price  of 
arsenic  to  consumers  was  fixed.1 

The  Army  was  daily  increasing  its  demands  for  arsenic,  both  for 
airplane  "  dope  "  and  poison  gas,  and  by  the  middle  of  the  summer  of 
1918  their  needs  were  estimated  at  6,400  tons  for  the  coming  12 
months.  Added  to  this  were  the  British  requirements  of  2,000  tons, 
making  the  military  needs  of  the  country  8,400  tons.  As  stated 
above,  however,  our  total  output  of  1917  was  equal  only  to  6,151 
tons,  and  this  amount,  it  was  estimated,  would  be  increased  through 
new  production  facilities  by  some  2,000  tons.  Therefore,  our  entire 
domestic  production  would  barely  meet  our  military  demands. 
Investigation  into  other  possible  sources  showed  that  if  we  included 
all  our  stocks  and  such  supplies  as  were  available  in  Canada  we  might 
possibly  count  on  a  maximum  of  14,400  tons  for  the  year  ending 
July,  1919.  There  would  then  be  available  for  agricultural  and  other 
uses  about  6,000  tons.  Of  this,  1,000  tons  had  already  been  delivered 
to  producers  of  sheep  dips  and  glass.  Our  requirements  of  1917-18 
had  been  approximately  11,300  tons,  of  which  8,000  had  gone  into 
agricultural  uses,  2,000  into  the  manufacture  of  glass,  and  1,300  into 
the  drug  industry  and  other  miscellaneous  uses.  It  appeared,  there- 
fore, that  there  would  not  be  sufficient  arsenic  to  supply  even  our 
agricultural  needs. 

Curtailment  of  uses  as  far  as  possible  was  then  the  only  logical 
remedy  and  immediately  all  deliveries  of  arsenic  for  the  manufacture 
of  glass  were  stopped.  Economies  were  also  enforced  in  the  manu- 
facture of  sheep  dips  and  Paris  green,  and  substitutes  were  used 
wherever  possible.2  The  situation  finally  was  relieved,  and  not  only 
were  the  war  needs  met  but  also  those  of  the  insecticide  manu- 
facturers. 

UNLICENSED  CONTROL  OVER  COMMODITIES  AT  UETAIL. 

One  of  the  two  distinct  handicaps  to  complete  control  over  foods 
which  the  Food  Administration  had  to  face  at  the  outset  was  that 
clause  in  the  act  which  exempted  dealers  in  foods  at  retail  from  li- 
cense control  when  their  gross  sales  fell  below  $100,000  annually.3 
But  so  firmly  did  the  Food  Administrator  believe  that  Congress  was 
in  error  upon  that  point  that  the  Food  Administration  set  about  im- 
mediately to  control  the  retail  trade  by  other  methods.  It  seemed 

1  Other  margins  were  fixed  for  sales  by  dealers  who  sold  in  small  quantities.     An  addi- 
tional three-fourths  cent  per  pound  was  allowed  for  sales  which  were  above  20,000  pounds 
but  less  than  a  carload  ;  1  cent  for  sales  ranging  from  5,000  to  20,000  pounds  ;  2  cents 
for  quantities  varying  from  1  keg  to  5.000  pounds  ;  and  3  cents  for  sales  of  less  than  1  keg. 

2  Special  regulations  issued  by  the  Food  Administration  on  Oct.  24,  1918,  forbade  the 
sale  or  delivery  of  white  arsenic  of  certain  strength  to  any  person  for  the  manufacture  of 
sheep  or  cattle  dips,  and  on  Oct.  31   licensees  were  forbidden  to   use  white  arsenic  in 
the  manufacture  of  sheep  or  cattle  dips  without  the  special  permission  of  the  Food  Ad- 
ministration. 

3  The  other  handicap  was  the  exemption  of  producers  and  producers'  associations. 


GOVERNMENT    CONTROL   OVER   PRICES.  135 

patent  to  high  officials  in  the  administration  of  food  control  that  if 
both  ends  of  the  channels  of  distribution  were  left  uncontrolled 
(that  is,  the  producing  and  the  retailing  ends)  the  consumer  would 
after  all  have  no  protection  against  exorbitant  charges  by  retailers. 
The  law,  they  reasoned,  by  its  specific  exemption  might  even  seem  to 
encourage  high  prices.  The  class  of  retailers  exempted  by  the  act, 
moreover,  embraced  more  than  95  per  cent  of  the  total  number  of  re- 
tailers in  the  United  States.  Since  the  penalties  for  violations  of 
the  broad  grants  of  power  under  section  4  seemed  of  doubtful  char- 
acter, the  Food  Administration  abandoned  hope  of  enforcing  its  rules 
upon  retailers  directly,  and  worked  out  schemes  to  enforce  them  in- 
directly and  despite  the  act.  It  soon  came  into  a  considerable  control 
over  the  retail  prices  of  foods  through  pressure  by  the  wholesale  li- 
censees, the  organization  of  the  retail  trade,  a  check  upon  retail  prices 
by  consumers'  reports,  and  the  publication  of  "  fair  price '"  lists. 

Indirect  control  through  licensees. — The  most  ingenious  scheme  by 
which  the  Food  Administration  brought  the  great  body  of  unlicensed 
retailers  under  control  was  by  a  control  of  their  supplies  which  came 
from  the  licensed  wholesalers.1  The  Food  Administration  could 
grant  or  withdraw  licenses  at  discretion  and  was  in  a  position,  there- 
fore, to  prohibit  licensees  from  selling  food  commodities  to  dealers 
who  violated  the  food  control  act.  It,  with  that  in  mind,  set  up  the 
so-called  rule  17  of  the  General  License  Regulations  which  became 
the  basis  of  control  over  the  retail  trade.  The  rule  provided  that — 

The  licensee  shall  not  knowingly  sell  any  food  commodities  to  any  persons 
engaged  in  the  business  of  selling  such  commodities  who  shall  after  this  regu- 
lation goes  into  effect  violate  the  provisions-pf  the  act  of  Congress  approved  Au- 
gust 10,  1917,  by  making  any  unreasonable  rate  or  charge  in  selling  or  otherwise 
handling  or  dealing  in  such  commodities,  or  by  holding,  contracting  for,  or  ar- 
ranging for  a  quantity  thereof  in  excess  of  the  reasonable  requirements  of  his 
business  for  use  or  sale  by  him  for  a  reasonable  time. 

The  enforcement  of  rules  for  retailers,  set  up  upon  the  basis  of 
this  authority,  entailed  such  difficulties  as  giving  notice  to  all 
licensees  not  to  sell  any  supplies  to  a.  particular  retail  violator.  Re- 
tail dealers  who  were  caught  hoarding  or  exacting  excessive  profits, 
however,  preferred  generally  to  submit  to  penalties  rather  than 
allow  the  Food  Administrator  to  notify  licensees,  cut  off  supplies, 
and  put  a  ban  upon  their  business.  The  directions  which  were  issued 
for  the  guidance  of  retailers  required  that  merchants  sell  certain 
commodities,  including  virtually  the  staple  articles,  at  not  more 
than  a  reasonable  advance  over  the  actual  purchase  price  without 

1  Dr.  Albert  N.  Merritt,  in  his  final  report  of  the  Distribution  Division,  ventures  the 
opinion  that  this  indirect  method  brought  the  unlicensed  retailer  under  food  control  almost 
to  the  same  extent  as  the  licensee. 


136  HISTORY   OF   PRICES   DURING   THE   WAB. 

regard  to  the  market  or  replacement  value  ;*  not  more  than  30  days' 
supply  of  sugar  or  flour  should  be  kept  on  hand,  or  more  than  60 
days'  supply  of  certain  other  foods;  not  more  than  one-eighth  barrel 
of  flour  should  be  sold  to  a  person  residing  in  a  city,  or  more  than 
one-quarter  barrel  to  a  person  residing  in  a  farming  community ; 
not  more  than  2  to  5  pound  quantities  of  sugar  should  be  sold  to 
persons  in  a  city,  or  more  than  5  to  10  pounds  to  those  in  a  farming 
community;  not  more  than  60  days'  supply  of  other  foods  should 
be  sold  to  any  customer;  wheat  flour  should  not  be  sold  unless  the 
customer  bought  an  equal  amount  of  wheat  substitutes;  and  that 
combination  sales  must  not  be  made  except  that  sugar  may  be  sold 
in  combination  with  corn  meal,  and  wheat  flour  must  not  be  sold 
except  with  wheat  flour  substitutes.2  The  retail  dealer  was  sub- 
jected to  the  same  cost  basis  rule  as  the  jobber,  and  finally  there 
were  established  for  him  maximum  margins  covering  many  of  the 
more  important  licensed  commodities.3 

The.  organization  of  the  retail  trade. — It  is  not  odd,  since  the  Food 
Administration  felt  so  much  need  for  cooperation  from  the  whole- 
sale trade,  that  it  also  desired  that  of  the  retail  trade.  About  the 
middle  of  October,  1917,  therefore,  a  conference  was  held  at  Wash- 
ington wTith  representative  retailers  throughout  the  country.  After 
that  conference  the  representatives  voluntarily  drew  up  resolutions 
pledging  the  retail  trade,  whether  licensed  or  unlicensed,  to  the  rules 
of  the  Food  Administration  and  forwarded  3,000,000  copies  to  the 
retailers  through  their  jobbers.4  Virtually  every  retailer,  then,  re- 

1  That  list  included  wheat  flour,  rye  Hour,  barley  flour,  oatmeal,  rolled  oats,  corn  grits, 
corn  meal,  hominy,   corn  flour,  cornstar.<jh,   corn  oil,   corn   sirup,   cleaned  rice,  rice   flour, 
•oleomargarine,  lard,  lard  substitutes,   oleo  oil,   cooking  fats,   condensed  milk,   evaporated 
milk,  powdered  milk,  fresh,  canned,  or  cured  'beef,  pork  or  mutton,   canned  peas,  canned 
dried  beans,  canned  tomatoes,  canned  corn,  canned  salmon,  canned  sardines,  dried  prunes, 
dried  apples,  dried  peaches,  dried  raisins,  sugar,  sirups,  molasses,  clarified  sugar,  planta- 
tion washed  sugar,  open-kettle  sugar,  dried  beans,  dried  peas,  cotton  seed,  cottonseed  oil, 
cottonseed  cake,  cottonseed  meal,  peanut  oil,  soya-bean  oil,   palm  oil,   copra  oil,  peanut 
meal,  soya  bean  meal,  and  feeds  of  all  kinds. 

2  These  rules  may  be  found  more  in  detail  in  "  Directions  for  Guidance  of  Persons  En- 
gaged in  Distributing  Food  Commodities  at  Retail,"  issued  Mar.  25,  1918. 

3  A  full  discussion  of  retail  maximum*  margins  appeared  earlier  in  the  chapter  under 
"  Policies  of  the  Food  Administrator." 

4  A  brief  digest  of  the  15  resolutions  drawn  up  on  Oct.  17,  1917,  by  representatives  of 
the  retail  trade  and  recommending  retailers  to  pledge  themselves  to  the  Food  Administra- 
tion  rules   follows:    1.  Cooperation    with   Food   Administration    by   retail    trade   whether 
licensed  or  not.     2.  Discontinuance  of  order  solicitations  during  the  war.     3.  Limitation 
of  deliveries  to  1  a  day  to  any  family  or  route.     4.  Cooperative  system  of  delivery.     5. 
Selling  of  substitutes  for  flour  and  meat.     6.  Urge  sale  of  cheaper  foods  of  good  quality 
recommended  by  the  Conservation  Division.     7.  Practice  economy  and  give  "  consumers 
the  lowest  possible  prices."     8.  All  retailers  and  retailers'  associations  should  write  their 
promise  of   support   to   the  Food   Administration.      9.   Solicitation   of   trade  papers.      10. 
Urge  sale  of  potatoes.     11.  Sale  of  foods  by  weight  and  for  cash.     12.  Sale  of  such  foods 
as  prunes,  corn  meal,  oat  meal,  rice,  and  hominy  in  bulk.     13.  Push  the  sale  of  soup  stock, 
peas,  rice,  barley,  fresh  vegetables,  and  oysters.     14.  Pledge  to  a  reasonable  living  margin 
of  profit,  "  irrespective  of  the  market  conditions  at  the  time  of  resale,"  and  such  profits 
not  to  be  greater  than  under  prewar  conditions.    15.   The  enlistment  of  all  individual  retail 
grocers  and  associations  of  retail  grocers. 


GOVERNMENT    CONTROL   OVER   PRICES.  137 

ceived  this  notice  from  the  wholesaler  who  furnished  him  with  sup- 
plies. The  patriotism  of  the  retailer  was  appealed  to  through  the 
press,  traveling  salesmen  of  wholesale  grocers,  boards  of  trade,  re- 
tail trade  associations,  and  through  conferences  between  local  repre- 
sentatives of  the  Food  Administration ;  and  a  national  pledge  cam- 
paign resulted  in  the  distribution  of  some  430,000  copies  of  the  re- 
tailers' pledge  poster. 

The  consumers'  reports. — One  of  the  most  effective  checks  upon 
so-called  retail  profiteering,  and  one  which  was  begun  soon  after  the 
creation  of  the  Food  Administration  and  was  continued  to  the  end 
of  the  war,  was  the  confidential  weekly  reports  of  retail  prices  by 
consumers.  The  Food  Administration,  by  aid  of  the  Comptroller  of 
the  Currency,  who  sent  out  circular  letters  to  the  banks  of  the. 
country,  made  up  a  list  of  reliable  reporters  throughout  the  country 
who  reported  regularly  prices  which  had  been  quoted  in  their  com- 
munity on  one  or  the  other  of  28  staple  commodities  (wheat  flour; 
wheat  bread:  cornmeal,  bulk;  oatmeal,  bulk;  rice;  steak,  round; 
bacon,  sliced ;  ham,  sliced ;  pork  chops ;  lard ;  milk ;  butter ;  oleomar- 
garine; cheese;  eggs;  sugar;  potatoes;  beans,  navy;  onions;  prunes; 
tomatoes;  peas;  corn;  salmon;  fish;  hens,  tea;  coffee)  without  the 
knowledge  of  the  retailer  that  the  quotations  would  be  sent  to  the 
Food  Administration.1  The  first  weekly  reports,  in  the  week  of 
October  6,  1917,  were  received  from  839  reporters  representing  798 
towns  and  cities.  On  September  28,  1918,  which  marked  the  close 
of  a  year  of  52  weeks,  the  work  had  so  increased  that  reports  were 
received  from  1,871  reporters  representing  1,305  towns  and  cities. 

These  reports,  showing  actual  retail  prices  being  paid  by  con- 
sumers, were  followed  closely  by  the  Food  Administration  and  served 
as  signals  to  special  investigations  when  the  weekly  chain  index 
showed  an  extraordinary  rise  over  the  week  preceding,  when  there 
appeared  peculiar  discrepancies  in  price  between  various  cities  or 
States,  when  there  was  a  wide  variance  with  the  prices  on  the  "  fair 
price  "  list,  when  peculiarities  appeared  by  comparisons  with  a  list 
of  corresponding  weekly  retail  prices  in  Canada  which  were  sent  by 
the  Canadian  Food  Administration,  or  when  the  weekly  relative 
prices  (figured  upon  the  base  October,  1917,  as  equal  to  100)  showed 
unusual  rises  away  from  the  earlier  level. 

The  "  fair  price  "  lists.— It  early  occurred  to  the  Food  Administra- 
tion that  an  especially  effective  control  over  retail  prices  could  be 
had  through  checking  weekly  retail  prices  "  actually  paid  "  by  the 
^consumer  against  those  which  he  "  should  pay."  The  setting  up  of 
the  system  of  consumers'  reports  to  watch  retail  prices  "  actually 

1  These  reporters  were  selected  women  of  the  town  usually,  such  as  the  wives  of  minis- 
ters, bankers,  and  professional  men,  and  who  took  interest  in  helping  the  Food  Adminis- 
tration in  its  plan  of  checking  retail  prices. 


138  HISTORY  OF   PRICES   DURING  THE   WAR. 

paid,"  as  has  been  said,  was  put  well  under  way  by  the  fall  of  1917, 
but  the  full  machinery  for  determining  retail  prices  that  consumers 
"should  pay"  and  the  publication  of  those  fair-price  lists  did  not 
become  effective  until  nearly  a  year  later.  The  whole  undertaking 
was  a  tremendous  one  because  it  proposed  to  announce  each  week 
what  prices  were  and  what  prices  should  have  been  for  any  one  of 
thirty-odd  food  staples  at  retail  in  the  various  markets  throughout 
the  country. 

The  embryo  of  what  developed  into  the  final  plan  was  started  in 
mid- fall  of  1917  when  all  Federal  food  administrators  were  asked  to 
announce  fair  prices  in  a  manner  similar  to  that  conceived  originally 
by  the  Illinois  food  administrator.1  It  meant  simply  an  understand- 
ing with  the  retail  distributors  by  which  they  voluntarily  agreed 
upon  a  reasonable  and  fair  margin  for  the  sale  of  certain  licensed 
goods.  The  costs  to  the  retailer  and  the  prices  to  the  consumer  were 
to  be  published.  The  published  prices  generally  represented  two 
maxima,  one  for  the  retailer  with  high  cost  and  the  other  for  the  re- 
tailer with  less  service  and  lower  cost. 

But  during  1918  there  came  a  change  in  this  informal  method, 
which  started  the  organization  of  so-called  interpreting  boards  in 
every  county  of  the  country  to  determine  fair  prices.  The  county 
food  administrator  was  made  chairman  of  his  interpreting  board 
composed  of  representative  wholesale  grocers,  retailers,  and  con- 
sumers. These  boards  met  in  their  respective  localities  and,  by  aid 
of  maximum  margins  furnished  them  by  the  Food  Administration, 
determined  fair  and  reasonable  retail  prices.  It  was  left  to  each 
board  simply  to  find  the  cost  to  the  retailer,  add  the  margins  sent  it 
by  the  Food  Administration,  and  publish  the  results  as  "  fair  prices." 
Again  there  were  two  maximum  prices  published — one  for  cash-and- 
carry  stores  and  one  for  credit-and-delivery  stores.  The  Food  Ad- 
ministration grew  more  and  more  courageous  in  its  dealing  with  the 
retail  problem  and  on  November  '7,  1918,  published  its  list  of  maxi- 
mum retail  margins  as  mandatory  rules  and  regulations  to  be  used  in 
retail  price  interpretation.  Gradually  a  particular  man  was  made 
responsible  for  this  work  in  each  State  and  1,200  local  committees 
were  appointed  to  meet  at  least  once  each  week.  These  committees 
determined  prices  applicable  for  their  respective  localities,  upon  the 
basis  of  the  new  maximum  margins  allowable,  and  pushed  vigorously 
the  publication  of  their  "  fair  prices  "  thus  .found.  The  "  fair  price  " 
lists  when  received  by  the  Food  Administration  at  Washington  were 

1Tho  Federal  food  administrator  of  Illinois,  as  oarly  as  October,  1017,  sot  forth  a  plan 
in  his  State  for  retail  control  through  the  publication  of  fair  prices.  It  provided  that  pub- 
licity be  given  to  the  prices  which  the  retailers  were  paying  the  wholesalers  for  a  few 
staple  foods  and  corresponding  fair  retail  selling  prices.  The  fair  selling  prices  were  de- 
termined upon  the  basis  of  cost  to  the  retailer  and  in  agreement  with  a  committee  of  the 
retail  trade. 


GOVERNMENT    CONTROL   OVER   PRICES.  139 

carefully  compared  with  the  prices  shown  on  the  consumers'  reports 
for  those  same  localities. 

The  weekly  reports  of  retail  prices  "  actually  paid,"  appearing 
upon  the  consumers'  reports,  show  variations  so  nearly  like  those 
that  the  interpreting  boards  said  the  consumers  "  should  pay,"  ap- 
pearing upon  the  "  fair  price  "  lists,  that,  the  Distribution  Division 
states,  in  its  final  report,  "prices  *  *  *  had  been  stabilized  to 
such  a  degree  that  the  difference  in  freight  constituted  practically  the 
only  difference  between  average  prices  paid  by  the  consumers  in  dif- 
ferent parts  of  the  country."  That  conclusion  does  not,  of  course,  bear 
upon  the  question  whether  the  maximum  margins  set  by  the  Food 
Administration,  and  upon  which  "  fair  price "  lists  were  built 
throughout  the  country,  were  too  low  or  too  high. 

It  is  well  worth  showing  into  what  statistical  form  these  thou- 
sands of  consumers'  reports  and  "  fair  price "  lists  were  put  that 
they  might  be  made  ready  and  useful  checks,  the  one  upon  the  other. 
An  analysis  of  a  single  one  of  these  weekly  confidential  "  fair  price  " 
bulletins,  perhaps,  would  give  an  adequate  picture  of  the  plan  and 
a  measure  of  its  real  significance.  The  regular  weekly  bulletin  for 
the  week  ending  just  prior  to  the  signing  of  the  armistice,  prepared 
for  limited  distribution  within  the  Food  Administration,  compares 
30  odd  retail  prices  which  consumers  "should  pay"  (represent- 
ing "fair  prices"  sent  in  on  366  reports  from  41  States)  with  cor- 
responding retail  prices  "  actually  paid "  (taken  from  1,686  con- 
sumers' reports).  It  states  in  summary: 

This  summary  shows  that,  during  the  week's  period  from  November  2  to 
November  9,  the  aggregate  cost  of  the  29  food  staples  decreased  0.9  cent,  or 
one-tenth  of  1  per  cent,  according  to  "  fair  prices,"  and  increased  3.3  cents, 
or  0.4  per  cent,  as  shown  by  our  corps  of  volunteer  reporters.  The  cost  of 
this  group  of  foodstuffs  on  November  2,  was  $8.891  and  on  November  9,  $8.882, 
as  published  by  the  fair  price  committees;  while  according  to  prices  actually 
paid,  the  cost  was  $8.935  on  November  2  and  $8.968  on  November  9.  This 
comparison  shows  that,  on  November  2,  these  combined  staples  cost  the  con- 
sumer 4.4  cents  more  than  the  aggregate  cost  as  reported  by  "  fair  prices," 
and  on  November  9,  8.6  cents  more. 

It  would  seem  doubtful  whether  that  generalization  is  as  useful, 
if  as  accurate,  as  some  that  may  well  be  made  from  the  comparative 
tables  of  individual  retail  prices  which  consumers  "should  pay" 
and  which  they  "  actually  paid."  The  "  fair  prices  "  allowable  in- 
creased during  the  week  on  14  items,  decreased  on  15  items,  and 
remained  stationary  on  6  items.  The  consumer-reporter  prices  in- 
creased on  14  items,  decreased  on  14  items,  and  remained  stationary 
on  7  items.  Curiously,  while  the  "fair  price"  allowable  for  corn  meal 
(packages)  was  increased  over  the  country  5.6  per  cent  during  the 
week,  the  consumer-reporter  prices  showed  that  the  price  actually 
charged  fell  off  1.37  per  cent.  On  the  other  hand,  while  the  price 


140 


HISTORY   OF   PRICES   DURING   THE   WAR. 


allowable  -for  potatoes  fell  off  0.8  per  cent,  the  price  being  charged 
increased  generally  2.2  per  cent.  These  analyses,  when  supported 
by  their  detailed  comparisons  by  States,  made  graphic  the  week-to- 
week  discrepancies.  A  summary  comparison  follows  of  commodities 
at  retail,  weighted  according  to  population,  showing  averages  of 
prices  that  consumers  "  should  pay  "  (known  as  "  fair  prices  "  and 
calculated  from  margins  by  interpreting  boards),  with  prices  that 
consumers  "actually  paid"  (known  as  consumer-reporter  prices) 
within  41  States,  for  the  week  ended  November  2,  with  those  for 
the  week  ended  November  9,  1918. 

A  COMPARISON  OF  AVERAGE  FAIR  PRICES  WITH  CONSUMER-REPORTER  PRICES 
IN  THE  UNITED  STATES  FOR  THE  WEEK  PRIOR  TO  THE  SIGNING  OF  THE 
ARMISTICE. 


Commodities. 

Unit. 

Fair  prices. 

Consumer-reporter  prices. 

Week  ended— 

Per  cent 
ofin- 

crease(+) 
or  de- 
crease(—  ). 

Week  ended— 

Per  cent 
ofin- 
crease(+) 
or  de- 

crease(-). 

Nov.  2. 

Nov.  9. 

Nov.  2. 

Nov.  9. 

Wheat  flour 

•jV  barrel        

$0.820 
070 

$0.  816 
.070 

-0.5 

$0.831 
.072 
.149 
.099 
.077 
.107 
.066 
.076 
.081 
.103 
.139 
.089 
.495 
.175 
.191 
.189 
.238 
.313 
.075 
.148 
.142 
.640 
.395 
.381 
.605 
.374 
.571 
.415 
.519 
.341 
.291 
.048 
.166 
.177 
.157 

$0.  828 
.073 
.148 
.098 
.076 
.108 
.065 
.075 
.080 
.102 
.139 
.088 
.506 
.175 
.191 
.189 
.237 
.313 
.C75 
.150 
.143 
.645 
.399 
.382 
.622 
.373 
.574 
.413 
.520 
.339 
.292 
.047 
.166 
.178 
.159 

-0.4 
+1.4 
-0.7 
-1.0 
-1.3 
+0.9 
-1.5 
-1.3 
-1.2 
-1.0 

""-i.'i 

+2.2 

Do 

Pound 

Victory  bread                     .... 

24  ounces       

.146 
.099 
.070 
.109 
.062 
.071 
.079 
.103 
.139 
.086 
.495 
.181 
.193 
.195 
.236 
.317 
.076 
.156 
.139 
.645 
.414 
.386 
.581 
.385 
.566 
.409 
.493 
.345 
.294 
.043 
.161 
.171 
.156 

.146 
.099 
.071 
.108 
.061 
.075 
.080 
.103 
.139 
.085 
.491 
.179 
.196 
.199 
.235 
.320 
.079 
.158 
.137 
.650 
.417 
.389 
.597 
.348 
.563 
.408 
.499 
.341 
.291 
.043 
.159 
.170 
.160 

Do 

16  ounces 

Barley  flour 

Pound     

+1.4 
-0.9 
-1.6 
+5.6 
+1.3 

Sugar 

do 

Corn  meal  bulk 

do 

Corn  meal  package 

do 

Oatmeal  bulk 

do 

Oatmeal  package 

do 

Rice 

.    do 

Hominy  or  grits 

do 

-1.2 
-0.8 
-1.1 

+  1.5 
+2.1 
-0.4 
+0.9 
+3.9 
+  1.3 
-1.4 
+0.8 
+0.7 
+0.8 
+2.7 
-9.6 
-0.5 
-0.2 
+  1.2 
-1.1 
-1.0 

Potatoes 

Peck        

Tomatoes 

No  2  can 

Peas 

do 

Corn 

do 

Salmon,  tall  pink  
Salmon  tall  red 

No.  1  can  

do 

-0.4 

Evaporated  milk 

6-ounce  can 

Do 

16-ounce  can 

+  1.3 
+0.7 
+0.8 
+  1.0 
+0.3 
+2.8 
-0.3 
+0.5 
-0.5 
+0.2 
-0.6 
+0.3 
-2.1 

Milk 

Quart  

Butter 

Pound 

Cheese 

do            ...... 

do 

Eggs  fresh 

Dozen         

Steak  round 

Pound 

Bacon,  sliced 

do         

Pork  chops 

do 

Ham  sliced 

do        

Lard        

...do  

Lard  substitutes 

do        

Onions 

do 

Beans  white 

.  do        

-1.2 
-0.6 
+2.6 

Prunes 

do 

+0.6 
+  1.3 

Raisins  seeded 

do        

8.891 

8.882 

-0.1 

8.935 

8.968 

+0.4 

A  comparison  of  retail  prices. — It  is  particularly  interesting,  by 
reason  especially  of  the  various  roundabout  methods  used,  to  know 
how  far  the  Food  Administration  got  in  its  control  over  retail  prices. 
There  are,  of  course,  no  data  available  to  give  a  precise  statistical 
measure  of  the  effect  of  the  above  controls  upon  retail  prices.  Of  all 
its  regulations,  those  over  the  retailer  were  by  necessity  the  most 


GOVERNMENT   CONTROL   OVER   PRICES. 


141 


nebulous.  But  from  a  study  of  the  prices  of  commodities  at  retail 
it  is  possible  to  see  how  they  moved  with  respect  to  each  other,  and  to 
judge  whether  or  not  the  more  highly  controlled  foods  showed  greater 
stabilization.  That  comparison  makes  obvious  some  generalizations 
which  are  quite  legitimate  and  striking. 

A    COMPARISON   OF   THE   PRICES    OF   28    COMMODITIES    AT    RETAIL   FROM 
OCTOBER,    1917,    TO    DECEMBER,    1918. 


Wheat  flour. 

Wheat  bread. 

Corn  meal, 
bulk. 

Oatmeal. 

Rice. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Months: 
1917_October  

£0.848 
.834 
.823 
.821 

100 
98 
97 
97 
96 
97 
97 
97 
98 
98 
99 
99 
98 
97 
97 

99 
97 
97 
98 
97 

$0.  108 
.107 
.103 
.103 
.102 
.102 
.100 
.100 
.100 
.099 
.099 
.099 
.099 
.098 
.098 

.106 
.102 
.100 
.099 
.098 

100 
99 
95 
95 
94 
94 
93 
93 
93 
92 
92 
92 
92 
91 
91 

98 
94 
93 
92 
91 

$0-068 
.068 
.068 
.068 
.068 
.069 
.069 
.069 
.066 
.066 
.066 
.066 
.066 
.065 
.063 

.068 
.068 
.068 
.066 
.065 

109 
100 
100 
100 
100 
101 
101 
101 
97 
97 
97 
97 
97 
96 
93 

100 
100 
100 
97 
96 

$0.  089 
.088 
.087 
.088 
.087 
.088 
.091 
.032 
.086 
.085 
.085 
.085 
.085 
.081 
.080 

.088 
.088 
.090 
.085 
.082 

100 
99 
98 
99 
98 
99 
102 
103 
97 
96 
96 
96 
96 
91 
90 

99 
99 
101 
96 
92 

$0.  110 
.111 
.112 
.114 
.116 
.118 
.119 
.119 
.124 
.128 
.133 
.135 
.138 
.139 
.138 

.111 
.116 
.120 
.131 
.138 

100 

101 
102 
104 
105 
107 
108 
108 
113 
116 
121 
123 
125 
126 
125 

101 
105 
109 
119 
125 

November 

December  

1918  —  January  

February 

.818 
.825 
.823 
.824 
.827 
.831 
.837 
.837 
.833 
.826 
.819 

.836 
.821 

.824 
.835 
.826 

March... 

April 

May.:::::.:::::::::: 

June  ... 

July 

August.—  

September 

October  

November 

December 

Quarters: 
1917—  Fourth 

1918—  First  

Second 

Third 

Fourth    

Steak,  round. 

Bacon,  sliced. 

Ham,  sliced. 

Pork  chops. 

Lard. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Months: 
1917—  October  

SO.  293 
.289 
.289 
.294 
.299 
.304 
.323 
.350 
.375 
.376 
.376 
.381 
.379 
.373 
.372 

.291 
.299 
.349 
.378 
.375 

100 

99 
99 
100 
102 
104 
110 
119 
128 
128 
128 
130 
129 
127 
127 

99 
102 
119 
129 
128 

$0.472 
.480 
.485 
.490 
.491 
.483 
.491 
.497 
.509 
.514 
.527 
.544 
.505 
.574 
.581 

.478 
.488 
.499 
.527 
.573 

100 
102 
103 
104 
104 
•102 
104 
105 
108 
109 
112 
115 
120 
122 
123 

101 
103 
106 
112 
121 

$0.404 
.406 
.410 
.415 
.419 
.419 
.428 
.437 
.460 
.469 
.483 
.502 
.515 
.518 
.527 

.406 
.417 
.441 
.483 
.520 

100 
100 
101 
103 
104 
104 
106 
108 
114 
116 
120 
124 
127 
•128 
130 

100 
103 
109 
120 
129 

$0.369 
.351 
.346 
.347 
.343 
.341 
.349 
.358 
.368 
.373 
.     .394 
.421 
.429 
.413 
.404 

.356 
.344 
.358 
.394 
.415 

100 
95 
94 
94 
93 
92 
95 
97 
100 
101 
107 
114 
116 
112 
109 

96 
93 
97 
107 
112 

$0.312 
.325 
.332 
.332 
.333 
.332 
.333 
.332 
.329 
.328 
.331 
.335 
.340 
.340 
.340 

.322 
.332 
.331 
.331 
.340 

100 
104 
106 
106 
107 
106 
107 
106 
105 
105 
106 
107 
109 
109 
109 

103 
106 
106 
106 
109 

November. 

December  

1918  —  January  

February 

March 

April. 

Mav 

June  

July 

August  

September 

October  

November  

December  

Quarters: 
1917—  Fourth 

1918—First 

Second.  .  . 

Third 

Fourth  

The  Food  Administration  really  did  not  get  started  upon  its  con- 
trol over  retail  prices  until  after  October,  1917.  There  have  been  put 
into  statistical  form,  therefore,  the  retail  prices  "  actually  paid  "  by 
over  1,000  consumers  at  various  markets  throughout  the  country, 


142 


HISTORY   OF   PRICES   DURING   THE   WAK. 


from  October,  1917,  to  December,  1918.  The  accompanying  tables 
show  the  movement  of  actual  prices  from  October  28  of  the  most  im- 
portant food  staples  at  retail.  The  comparison  is  expedited  by  the 
presentation,  alongside  the  actual  prices,  of  relative  prices  figured 
with  the  October,  1917,  actual  price  taken  as  a  base  equal  to  100. 


Milk. 

15  utter. 

Oleomar- 
garine. 

Cheese. 

GggS. 

Ac- 
tual. 

Rel- 
ative. 

Ac- 
tual. 

Rel- 
ative. 

Ac- 
tual. 

Rel- 
ative. 

Ac- 
tual. 

Rel- 
ative. 

Ac- 
tual. 

Rel- 
ative. 

Months: 
1917—  October  

$0.118 
.123 
.126 
.127 
.127 
.128 
.127 
.127 
.126 
.127 
.129 
.132 
.139 
.144 
.146 

.122 
.127 
.127 
.129 
.143 

100 
104 
107 
108 
108 
108 
108 
108 
107 
108 
109 
112 
118 
122 
124 

103 
108 
108 
109 
121 

$0.510 
.511 
.527 
.547 
.557 
.533 
.503 
.500 
.502 
.515 
.531 
.579 
.636 
.650 
.696 

.516 
.546 
.501 
.540 
.661 

100 
100 
103 
107 
109 
105 
99 
98 
98 
101 
104 
114 
125 
127 
136 

101 
107 
98 
106 
130 

SO.  343 
.349 
.353 
.356 
.358 
.351 
.352 
.351 
.350 
.352 
.354 
.361 
.374 
.382 
.386 

.348 
.355 
.351 

.355 
.381 

100 
102 
103 
104 
104 
102 
103 
102 
102 
103 
103 
105 
109 
111 
113 

101 
103 
102 
103 
111 

SO.  350 
.347 
.352 
.352 
.356 
.353 
.349 
.346 
.341 
.342 
.349 
.360 
.382 
.401 
.420 

.350 
.354 
.345 
.350 
.401 

100 
99 
101 
101 
102 
101 
100 
99 
97 
98 
100 
103 
109 
115 
120 

100 
101 
99 
100 
115 

$0.493 
.527 
.561 
.009 
.554 
.397 
.383 
.384 
.391 
.430 
.467 
,510 
.501 
.634 
.706 

.524 
".527 
.386 
.466 
.634 

100 
107 
114 
124 
112 
81 
78 
78 
79 
87 
95 
103 
114 
129 
14J 

106 
107 
78 
95 
129 

November  

December 

1918  —  January  

February  . 

March 

April.  . 

May 

June 

July  

August 

September  

October     

November 

December  

Quarters: 
1917—  Fourth  

1918—  First 

Second  

Third  . 

Fourth  

Sugar. 

Potatoes. 

Beans,  navy. 

Onions. 

Prunes. 

Ac- 
tual. 

Rel- 
ative. 

Ac- 
tual. 

Rel- 
ative. 

Ac- 
tual. 

Rel- 
ative. 

Ac- 
tual. 

Rel- 
ative. 

100 
100 
102 
104 
104 
96 
88 
98 
108 
112 
112 
108 
98 
92 
88 

100 

102 
98 
110 
92 

Ac- 
tual. 

Rel- 
ative. 

Months: 
1917—  October 

SO.  098 
.099 
,098 
.097 
.096 
.094 
.093 
.093 
.093 
.094 
.095 
.099 
.106 
.108 
.109 

.099 

.1)96 
.093 
.096 
.108 

100 
101 
100 
99 
98 
96 
95 
95 
95 
96 
97 
101 
108 
110 
111 

101 
98 
95 
98 
110 

$0.434 
.449 
.441 
.444 
.436 
.392 
.336 
.322 
.456 
.595 
.567 
.575 
.537 
.496 
.481 

.440 

.426 
.332 
.580 
.505 

100 
103 
102 
102 
100 
90 
77 
74 
105 
137 
131 
132 
124 
114 
111 

101 
98 

77 
134 
116 

$0.  188 
.185 
.184 
.184 
.180 
.182 
.180 
.178 
.176 
.173 
.173 
.171 
.168 
.164 
.159 

.186 
.182 
.178 
.172 
.164 

1GO 
98 
98 
98 
96 
97 
98 
95 
94 
92 
92 
91 

87 
85 

99 
97 
95 
91 

87 

$0.051 
.051 
.052 
.053 
.053 
.049 
.045 
.050 
.055 
.057 
.057 
.055 
.050 
.047 
.045 

.051 
.052 
.050 
.056 
.047 

$0.173 
.172 
.170 
.170 
.169 
.169 
.169 
.169 
.164 
.165 
.168 
.171 
.175 
.177 
.179 

.172 

.169 
.168 
.168 
.177 

100 
99 
98 
98 
98 
98 
98 
98 
95 
95 
97 
99 
101 
102 
103 

99 
98 
97 
97 
102 

November 

December... 

1918  —  January 

February.  . 

March 

April.  . 

May 

June  
July 

August  

September 

October  

November  
December  

Quarters: 
1917—  Fourth  

1918—  First 

Second... 

Third 

Fourth 

The  eye  is  caught  at  once  by  the  striking  differences  in  the  move- 
ment of  the  cereals,  which  were  highly  controlled,  and  the  meats, 
which  were  not  highly  controlled.  The  prices  of  wheat  flour,  wheat 
bread,  corn  meal  in  bulk,  and  oatmeal  in  bulk  hold  strikingly  near, 
or  even  below,  their  level  at  the  time  retail  control  set  in.  The 


GOVERNMENT   CONTROL   OVER   PRICES. 


143 


prices  of  round  steak,  sliced  bacon,  sliced  ham,  and  pork  chops, 
on  the  other  hand,  all  show  marked  rises  during  the  same  period. 
Beans,  which  were  highly  controlled,  receded  from  their  earlier 
level.  Sugar,  which  was  highly  controlled  from  the  outset,  main- 


Tomatoes. 

Peas. 

Corn. 

Salmon. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Months— 
1917  October 

SO.  168 
.165 
.  161 
.162 
.163 
.165 
.166 
.167 
.163 
.166 
.169 
.172 
.175 
.176 
.178 

.  165 
.183 
.165 
.169 
.176 

100 
98 
96 
96 
97 
98 
99 
99 
97 
99 
101 
102 
104 
105 
106 

98 
97 
98 
101 
105 

$0.  177 
.176 
.175 
.177 
.177 
.175 
.178 
.178 
.177 
.178 
.181 
.185 
.189 
.191 
.193 

.176 
.177 
.177 
.181 
.191 

100 
99 
99 
100 
100 
99 
101 
101 
100 
101 
102 
105 
107 
108 
109 

99 
100 
100 
102 

108 

$0.  177 
.173 
.171 
.171 
.171 
.170 
.172 
.173 
.172 
.174 
.177 
.181 
.186 
.189 
.189 

.174 
.171 

.172 
.177 

.188 

100 
98 
97 
97 
97 
96 
97 
98 
97 
98 
100 
102 
105 
107 
107 

98 
97 
97 
100 
106 

$0.  271 
.271 
.274 
.275 
.277 
.272 
.274 
.277 
.293 
.298 
.301 
.305 
.310 
.314 
.317 

.272 
.274 

.281 
.301 
.314 

100 
100 
101 
101 
102 
100 
101 
102 
108 
110 
111 
113 
114 
116 
117 

100 
101 
104 
111 
116 

November  

December  

February 

March..."  

April  ... 

May  

June     

July 

August 

September     

October 

November  

December  

Quarters— 
1917—  Fourth  

1918—  First    

Second 

Third  

Fourth... 

Fish. 

liens. 

Tea. 

Coffee. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

Actual. 

Rela- 
tive. 

100 
100 
100 
101 
100 
96 
96 
96 
91 
89 
89 
89 
90 
91 
94 

100 
99 
94 
89 
91 

Months— 
1917  October 

SO.  231 
.234 
.242 
.257 
.261 
.257 
.252 
.244 
.241 
.249 
.249 
.255 
.255 
.256 
.261 

.235 

.258 
.2-46 
.251 
.257 

100 
101 
105 
111 
113 
111 
109 
106 
104 
108 
108 
110 
110 
111 
113 

102 
112 
106 
109 
111 

$0.284 
.279 
.283 
.298 
.323 
.342 
.350 
.341 
.340 
.343 
.349 
.351 
.353 
.353 
.352 

.282 
.319 
.344 
.347 
.353 

100 
98 
100 
105 
114 
120 
123 
120 
120 
121 
123 
124 
124 
124 
124 

99 
112 
121 
122 
124 

$0.617 
.618 
.629 
.627 
.631 
.621 
.625 
.630 
.622 
.625 
.630 
.636 
.646 
.653 
.653 

.621 
.626 
.626 
.630 
.651 

100 
100 
102 
102 
102 
101 
101 
102 
101 
101 
102 
103 
105 
106 
106 

101 
101 
101 
102 

106 

$0.318 
.317 
.319 
.320 
.319 
.306 
.305 
.305 
.288 
.284 
.284 
.284 
.285 
.288 
.298 

.318 
.315 
.300 
.284 
.290 

November  

December  

1918  Januarv  

February 

March  

April 

May  

June 

July 

August    

September 

October  

November         

December 

Quarters— 
1917—  Fourth 

1918—  First 

Second  

Third 

Fourth 

The  above  sories  of  retail  prices  are  averaees  of  prices  "actually  paid  "  by. consumers,  made  from  confi- 
dential reports  to  the  United  States  Food  Administration  by  from  839  to  2~,076  consumer-reporters,  repre- 
senting from  798  to  1,429  cities  and  towns  of  the  country. 

tained  its  early  level  strictly  until  the  fall  of  1918.  The  highly 
controlled  canned  goods,  tomatoes,  peas,  and  corn,  held  closely  to 
their  October,  1917,  levels.  But,  on  the  other  hand,  rice,  the  dairy 
products  (milk,  butter,  cheese),  and  eggs  moved  in  varying  de- 
grees away  from  their  respective  bases.  It  remains  for  each  to  in- 


144 


HISTORY  OF  PRICES   DURING  THE   WAR. 


terpret  the  movement  of  these  retail  prices  as  he  will.  But  it  seems 
distinctly  clear  that  the  highly  controlled  retail  commodities,  in  the 
main,  showed  a  considerable  stabilization  in  price  control  after 
October,  1917. 

Retail  prices  in  United  States  and  Canada. — A  regular  check  was 
kept,  too,  of  the  comparative  movements  of  these  28>  staple  foods  at 
retail  in  this  country  with  corresponding  ones  in  Canada.  There  is 
given  below  a  comparison  of  average  retail  prices  for  the  week  ended 
October  6,  1917,  with  those  for  the  week  ended  September  28,  1918 
(one  year  later),  showing  percentages  of  increase  or  decrease  for 
the  United  States  and  Canada.  This  table  has  value  in  the  com- 
parison which  it  affords  both  of  rises  and  falls  in  price  on  the  last 
of  September,  1918,  over  quotations  on  that  date  a  year  previous 
within  each  country,  and  of  the  corresponding  rises  and  falls  between 
the  two  countries.  The  price  for  the  weeks  quoted  seemed  related 
closely  enough  to  the  prevailing  price  of  that  period  to  make  this 
sampling  process  not  wholly  without  significance.  If  the  articles 
for  which  Canadian  quotations  are  lacking  be  omitted  from  the 
American  list  also,  the  increase  in  total  cost  is  7.9  per  cent  in  this 
country  as  against  12.3  per  cent  in  Canada. 

A    COMPARISON    OF   RETAIL,    PRICES    IN    THE    UNITED    STATES    AND    CANADA. 


Commodities. 

Unit. 

United  States. 

Canada. 

Week  ended— 

Increase  (+) 
or 
decrease  (—). 

Week  ended— 

Increase  (+) 
or 
decrease  (—). 

Oct.  6, 
1917. 

Sept.  28, 
1918. 

Abso- 
lute. 

Per 
cent. 

Oct.  6, 
1917. 

Sept.  28, 
1918. 

Abso- 
lute. 

Per 

cent. 

Wheat  flour 

fj  barrel.  . 
Pound  
.do  

$0.869 
.109 
.068 
.089 
.109 
.291 
.462 
.397 
.368 
.308 
.116 
.511 
.324 
.348 
.482 
.098 
.419 
.187 
.049 
.171 
.168 
.175 
.175 
.272 
.227 
.279 
.616 
.318 

$0.  837 
.099 
.066 
.084 
.136 
.381 
.554 
.509 
.430 
.336 
.133 
.619 
.367 
.368 
.529 
.102 
.572 
.170 
.053 
.173 
.173 
.187 
.183 
.308 
.256 
.347 
.640 
.284 

-$0.  032 
-  .010 
-  .002 
-  .005 
+  .027 
+  .090 
+  .092 
.  +  .112 
+  .062 
+  .028 
+  .017 
+  .108 
+  .043 
+  .020 
+  .047 
+  .004 
+  .153 
-  .017 
+  .004 
+  .002 
+  .005 
+  .012 
+  .008 
+  .036 
+  .029 
+  .068 
+  .024 
-  .034 

-  3.7 
-  9.2 
-  2.9 

-  5.6 
+  24.8 
+30.9 
+  19.9 
+  28.2 
+  16.8 
+  9.1 
+  14.7 
+  21.1 
+  13.3 
+  5.7 
+  9.7 
+  4.1 
+  36.5 
-  9.1 
+  8.2 
+  1.2 
+  3.0 
+  6.9 
+  4.6 
+  13.2 
+  12.8 
+  24.4 
+  3.9 
-10.7 

$0.834 
.072 
(]) 
.065 
.092 
.286 
.451 

%, 

.312 
.105 
.495 

(^ 

.514 
.106 

% 

;?«, 

.141 

.160 
.189 
.264 
.180 
0) 
.493 
.405 

$0.  815 
.079 
0) 
.080 
.121 
.347 
.535 

%, 

.369 
.101 
.525 

i^07 
.554 
.119 
0) 
.168 
0) 
.183 
.170 
.202 
.245 
.330 
.174 

.609 
.451 

-$0.  019 
+  .007 
0) 
+  .015 
+  .029 
+  .061 
+  .084 

As 

+  .057 
-  .004 
+  .030 

+% 

+  .040 
+  .013 

+<% 

/.w 

+  .029 
+  .042 
+  .056 
+  .066 
-  .006 

(') 
+  .116 
+  .046 

-  2.3 

+  9.7 
0) 
+  23.1 
+31.5 
+21.3 
+  18.6 
0) 
+  18.8 
+  18.3 
-  3.8 
+  6.1 
(0 
+  1.7 
+  7.8 
+  12.3 

flu, 

0) 
+  15.1 
+20.6 
+26.3 
+29.6 
+  25.0 
-  3.3 
0) 
+  23.5 
+  11.3 

Wheat  bread.  
Corn  meal,  bulk.  . 

Oatmeal,  bulk  
Rice           

...do  
...do  

Steak  ,  round  
Bacon,  sliced  

...do  
..do... 

Ham,  sliced  
Pork  chops  

...do  
...do.... 

Lard 

do 

Milk  

Quart  
Pound  
...do  
do  

Butter             .  . 

Oleomargarine  
Cheese       

Eees 

Dozen  
Pound  
Peck 

Sugar     

Potatoes 

Beans,  navy  

Pound  
do    . 

Onions 

Prunes  

...do  

Tomatoes    

No.  2can  . 

Peas 

do 

Corn          

...do  

Salmon 

No  lean 

Fish    

Pound  .... 
do.  ... 

Hens 

Tea 

do 

Coffee  

...do  

Aggregate  

8.005 

8.896 

+  .891 

+  11.1 

6.125 

6.882 

+  .757 

+  12.3 

1  Commodities  on  which  comparison  is  impracticable. 


GOVERNMENT    CONTROL   OVER   PRICES.  145 

ENFORCEMENT   OF   THE    LICENSE    CONTROL. 

The  analyses  that  have  gone  before  lay  out  the  whole  lot  of  food 
regulations,  but  do  not  tell  systematically  how  those  controls  were 
enforced.  The  license  system  would  have  been  a  shell,  and  its  re- 
quirements colorless,  without  practical  and  effective  methods  of  en- 
forcement. Mention  has  been  made  already  of  the  teeth  which  were 
put  into  the  act  itself.  Those  penalty  clauses,  beyond  doubt,  struck 
fear  in  the  minds  of  would-be  violators  and  inspired  respect  for  the 
rules  set  up  under  the  act  generally.  But,  curiously,  the  resort  to 
criminal  proceedings,  the  seizure  of  hoarded  commodities  or  the  re- 
quisitioning of  supplies  and  plants  was  relatively  infrequent.  The 
great  bulk  of  violations,  in  points  both  of  number  and  importance, 
were  treated  by  the  quasi  judicial  administrative  agencies  created 
under  the  act. 

The  Enforcement  Division. — The  Enforcement  Division  of  the 
Food  Administration  revoked  altogether  8,676  licenses,  in  addition 
to  other  cases  handled  directly  by  the  Federal  State  food  adminis- 
trators, from  August  10,  1917,  to  December  30,  1918.1  The  common 
procedure  with  each  of  these  administrative  cases,  after  the  facts  of 
the  alleged  violation  were  found  by  a  State  food  administrator  and 
sent  to  the  Enforcement  Division  at  Washington,  was  to  grant  a 
hearing  to  the  parties  accused  to  determine  whether  there  was  a 
violation,  and,  if  so,  what  fine  should  be  imposed.  After  a  decision 
was  reached,  an  order  was  signed  by  the  Food  Administrator  and 
forwarded  to  the  State  administrator  for  service  upon  the  violator. 
Orders  addressed  to  a  licensee  usually  revoked  or  suspended  the  vio- 
lator's license,  or,  when  the  violator  chose,  sometimes  accepted  in  lieu 
of  such  revocation  a  contribution  to  the  Red  Cross  or  refund  of  excess 
profits.  Orders  addressed  against  a  nonlicensee  were,  necessarily, 
issued  in  a  roundabout  method  by  ordering  licensees  not  to  sell  goods 
to  the  nonlicensee  violator.  Stop  orders  were  often  given  to  hold 
up  the  issuance  of  a  license.  The  Food  Administration  did  not 
at  any  time  hesitate  to  turn  the  open  light  of  publicity  upon  these 
offenders.  Notice  was  given  through  the  press  and  trade  papers  of 
violations  by  particular  persons.  City  grocers  chose  frequently  to 
make  literally  extortionate  "  contributions "  rather  than  have  the 
"  black-list "  placard  of  the  Food  Administration  hung  in  their  shop 
windows.  There  were,  in  addition  to  this  very  important  phase  of  the 
enforcement  work,  four  others  which  were  even  more  of  an  extra- 

1  A  grouping  of  these  revocations  by  kind  shows  that  there  were  :  Unlimited  revocations, 
249 ;  limited  revocations,  187  ;  unlimited  unfair  orders,  58 ;  limited  unfair  orders,  43 ; 
refunds  and  contributions,  4,123  ;  temporary  suspensions  and  minor  penalties,  3,659  ;  requi- 
sitions, etc.,  65  ;  stop  orders,  210  ;  cancellations,  10  ;  criminal  cases,  72  ;  total,  8,676. 

125547°— 20 10 


146  HISTORY   OF   PRICES   DURING  THE   WAR. 

judicial  character  but  which  were  none  the  less  effective — the  li- 
censee reports  to  the  Food  Administration,  the  inspection  work,  the 
work  of  the  Federal  food  administrators  in  the  various  States,  and 
the  emphasis  upon  publicity. 

The  licensee  reports. — A  phase  of  the  enforcement  provisions  which 
many  officials  in  the  administration  of  food  control  believed  of 
especial  potency  was  the  general  requirement  of  reports  from  the 
licensees.  The  regulations  made  each  licensee  liable  to  give  under 
oath  complete  information  on  any  or  all  aspects  of  his  business  upon 
request  of  the  Food  Administration,  and  to  hold  his  records  and 
properties  open  for  inspection.1  These  licensee  reports,  made  upon 
blanks  submitted  by  the  Food  Administration,  became  effective 
checks  against  violations.  The  report  forms  generally  contained 
questions  asking  the  amount  on  hand  at  the  beginning  of  the  month, 
the  amount  sold  during  the  month,  the  amount  on  hand  at  the  end 
of  the  month,,  and  financial  questions  designed  to  show  margins  of 
profit.  The  system  involved  an  infinite  amount  of  tedious  labor  for 
the  Food  Administration  and  the  licensee.  There  is  need  only  to 
realize  that  the  licensing  system  came  to  cover  virtually  all  manu- 
facturers and  distributors  of  foods  and  feeds  at  wholesale  to  appre- 
ciate the  flood  of  reports  that  poured  into  the  D  Street  office  at  Wash- 
ington. There  were  at  the  time  of  the  signing  of  the  armistice, 
moreover,  54  different  kinds  of  periodical  reports  required  by  the 
Report  Division  alone.  The  Food  Administration,  after  examining 
the  applications  for  licenses,  determined  which  report  blanks  each 
licensee  should  fill  out.  monthly  or  quarterly.  A  Checking- in  Divi- 
sion kept  strict  record  of  all  reports  returned  upon  these  blanks,  and 
sent  follow-up  letters  after  the  tardy  reports.  The  reports,  after 
being  edited  and  having  the  violations  encircled  by  a  red-pencil 
mark,  were  referred  to  the  various  commodity  chiefs  or  other  proper 
responsible  administrators.  There  were,  at  full  tide,  about  140,000 
names  upon  the  regular  mailing  lists,  of  which  105,000  were  required 
to  give  monthly  reports  and  35,000  quarterly  reports  and  which 
required  the  attention  of  nearly  500  clerks  at  the  Food  Administra- 
tion. If  a  calculation  based  upon  the  returns  made  during  May, 

1  Rule  I  of  the  General  Regulations  states:  "It  shall  bo  the  duty  of  each  license!-  to 
give  to  such,  representative  as  may  be  designated  by  the  United  States  Food  Administrator, 
whenever  the  said  representative  shall  so  require,  any  information  concerning  the  condi- 
tions and  management  of  the  business  of  the  licensee.  Reports,  when  requested  by  said 
representative,  shall  be  made  on  such  blanks,  to  be  furnished  by  the  United  States  Food 
Administration,  as  the  United  States  Food  Administrator  may  designate,  giving  complete 
information  regarding  transactions  in  any  commodities  imported,  manufactured,  refined, 
packed,  purchased,  contracted  for,  received,  sold,  stored,  shipped,  or  otherwise  handled, 
distributed,  or  dealt  with  by  the  licensee,  or  on  hand,  in  the  possession  or  under  the  con- 
trol of  the  licensee,  and  any  other  information  concerning  the  business  of  the  licensee  that 
such  representative  may  require  from  time  to  time.  Whenever  tho  said  representative 
shall  require  it,  the  licensee  shall  furnish  sucli  information  in  writing  under  oath." 


GOVERISTME^T    CONTROL   OVER   PRICES.  147 

1918,  is  typical,  the  checked-in  reports  numbered  about  85  per  cent 
of  the  blanks  mailed  out. 

It  became  apparent  by  the  summer  of  1918  that  the  report  system, 
though  in  most  senses  effective  as  such,  had  been  allowed  to  grow 
until  it  was  both  annoying  to  the  licensees  and  top-heavy  to  the  ad- 
ministrators. The  volume  of  work  involved  in  checking  out  blanks, 
checking  in  reports,  returning  reports  for  corrections  and  explaining 
misunderstandings  by  correspondence,  editing  and  tabulating  over 
100,000  reports  having  as  high  as  TO  questions  each,  literally  snowed 
under  the  clerical  staffs.  The  commodity  chiefs,  who  were  to  make 
regulations  from  month  to  month  by  aid  of  those  license  reports,  did 
not  receive  them  with  promptness.  It  was  decided,  rather  than  to 
double  the  clerical  staff,  to  reduce  the  number  of  reports  required. 
The  number  of  periodical  reports  was  cut  by  half  before  midsummer 
and  to  28,000  in  November.  There  were,  then,  at  the  signing  of  the 
armistice  just  20  per  cent  as  many  reports  made  regularly  as  during 
the  spring  previous. 

The  inspection  work. — With  the  gradual  reduction  in  the  licensee 
report  system,  a  scheme  of  field  inspection  was  instituted.1  The 
impetus  toward  the  proposed  plan  came  largely  from  the  success  of 
such  inspection  as  had  been  done,  under  the  old  report  system,  by 
inspectors  in  the  service  of  the  State  organizations.  Obviously  the 
Food  Administration  could  not  hope  to  cover  the  country  with  paid 
inspectors.  The  prominent  wholesale  grocers,  therefore,  who  dis- 
tributed a  large  share  of  foodstuffs  and  who  were  already  organized, 
were  called  to  Washington  and  enlisted  upon  a  volunteer  basis  to  act 
as  field  advisers,  They  were  thoroughly  instructed  in  the  purposes, 
policies,  and  requirements  of  the  Food  Administration.  The  in- 
spection system  was  later  reorganized  on  a  State  basis,  and  these 
field  advisers  were  used  as  an  educational  staff  available  upon  call 
of  the  Federal  food  administrators.  The  inspection  service,  though 
promising  according  to  the  view  of  the  Enforcement  Division,  was 
not  fully  developed  at  the  signing  of  the  armistice. 

The  Federal  food  administration  in  the  States. — The  temptation  is 
to  study  closely  the  policy-making  office  of  the  Food  Administration 
at  Washington,  and  thus  fail  to  appreciate  that  the  administration  of 
the  food  policies  was  highly  decentralized.  The  United  States  Food 
Administration,  in  the  truer  sense,  took  in  a  literal  hierarchy  of 
national,  zone,  State,  district,  county,  and  local  units  which  were 
organized  more  or  less  formally  and  which  were  administering  food 
policies. 

The  Food  Administration  at  Washington,  through  its  States 
Administration  Division,  disseminated  its  policies  and  rulings 

1  At  a  conference  held  Aug.  16,  1918,  the  Field  Supervision  Section  was  created  with 
Mr.  H.  A.  Sturges  as  chief,  and  with  a  small  corps  of  inspectors. 


148  HISTORY   OF   PRICES   DURING   THE   WAR. 

directly  through  its  ready  contacts  with  a  Federal  food  adminis- 
trator in  each  State,  the  District  of  Columbia,  Hawaii,  Porto  Rico, 
and  Alaska.  These  Federal  food  administrators  were  held  responsi- 
ble for  all  food-control  work  within  their  respective  States;  they 
concerned  themselves  with  the  enforcement  of  the  rules,  propagated 
conservation  policies,  and  administered  distribution  plans.  Obvi- 
ously, then,  the  States  Administration  Division,  acting  as  a  clearing 
house  between  the  policy-making  office  at  Washington  and  the  Fed- 
eral food  administrators  in  the  States,  was  obliged  to  keep  the  States 
informed  on  all  actions  taken  at  the  central  office.  This  task  it  did 
through  "  flying  squadrons  "  going  from  State  to  State  in  person,  zone 
meetings,1  meetings  for  the  State  and  local  administrators,  and  litera- 
ture through  the  mails.  The  Federal  food  administrators  and  their 
3,200  district  and  county  administrators,  though  serving  gratis,  con- 
ducted locally  the  national  campaigns  to  enroll  12,000,000  housewives 
as  members  of  the  Food  Administration,  to  use  more  potatoes,  to 
advertise  conservation  work  for  world  relief,  and  to  use  "  no  wheat." 
Each  Federal  food  administrator  had  on  his  staff  an  educational 
director,  a  home-economics  director,  a  State  merchant  representative, 
and  a  library  director.  The  most  important  specific  controls,  per- 
haps, which  were  administered  in  a  large  way  by  the  Federal  food 
administrators  were  those  pertaining  to  wheat  and  flour,  bakers,  meat, 
sugar,  perishables,  ice,  eggs,  price  publication,  and  public  eating 
places. 

The  emphasis  upon  publicity. — It  ought  again  be  mentioned,  by 
way  simply  of  emphasis,  that  the  Food  Administration  gave  wide 
publicity  to  all  of  its  policies  and  depended  upon  the  patriotism  of 
the  people  to  enforce  them.  No  housewife,  grocer,  manufacturer,  or 
miller  was  left  in  ignorance  of  the  war  measures  upon  which  it 
wanted  vigorous  cooperation,  and  the  social  organizations  of  all  forms 
and  local  papers  were  alert  to  denounce  violations.  The  effectiveness 
of  this  phase  of  the  control  enforcement  was  no  less  potent  because 
not  a  kind  which  permits  of  exact  analysis. 

THE  CENTRALIZATION  OF  GOVERNMENT  AND  ALLIED  FOOD  PURCHASES. 

The  problem  before  the  Food  Administration  was.  in  the  last 
analysis,  to  anticipate  and  prevent  a  world  food  shortage  during  the 
war.  The  scope  of  its  task  and  rising  prices  soon  made  necessary  the 
setting  up  of  affiliated  boards  to  help  control  the  food  markets  more 
rigidly.  These  extra  efforts  in  food  regulation  were  inevitable  steps 

1  For  administrative  purposes  the  States  were  divided  into  11  zones,  numbered  from  1 
to  11,  with  meetings  at  the  following  points,  respectively :  Boston,  Philadelphia,  New 
York,  Atlanta,  Chicago,  Vicksburg,  Kansas  City,  Fargo,  Denver,  Boise,  and  San  Francisco. 


GOVERNMENT   CONTROL   OVER   PRICES.  149 

forced  by  the  national  and  international  aspects  of  the  food  situation 
and  the  desire  to  assure  reasonable  prices  for  Government  and  allied 
purchases. 

The  food  requirements  of  the  Government  and  its  Allies  had  ab- 
sorbed the  lion's  share  of  many  staples,  and,  especially  during  the 
spring  of  1917,  opened  the  way  to  unrestrained  foreign  buying  and 
rampant  speculation.  There  had  been  no  control  of  commodity 
prices  in  this  country  and  extraordinary  rises  came  thick  and  fast. 
The  "  all  commodities "  index  number,  which  had  remained  near  a 
prewar  level  throughout  1914  and  1915,  shot  from  123  to  189  during 
the  year  ending  June,  1917,  and  the  food  group  jumped  from  111  to 
167  during  that  same  year.1  The  unregulated  bidding,  which  con- 
tributed to  the  rise  within  the  food  group,  was  later  controlled  in  part 
by  the  Food  Administration  Grain  Corporation,  the  International 
Sugar  Committee,  and  the  Sugar  Equalization  Board  which  are  men- 
tioned elsewhere,  and  by  the  Division  of  Coordination  of  Purchase 
and  the  Food  Purchase  Board  which  are  discussed  here. 

Division  of  coordination  of  purchase. — The  Division  of  Coordina- 
tion of  Purchase,  which  came  later  to  supervise  Government  and 
allied  purchases  of  foodstuffs  aggregating  $200,000,000  per  month 
and  over,  was  created  as  an  advisory  unit  through  which  all  war  food 
purchases  might  clear.2  An  arrangement  was  made  between  the 
Government  and  the  Allies  that  all  allied  food  requirements  (except 
grains,  flour,  and  meal)  should  be  submitted  to  a  so-called  allied  pro- 
visions export  commission,  which  in  turn  was  to  give  notice  of  those 
requirements  to  the  Food  Administration.3  The  Division  of  Coordi- 
nation of  Purchase,  upon  receipt  of  that  notice,  advised  what  method 
of  purchase  should  be  adopted  in  order  least  to  disturb  the  market. 
These  purchases  were  either  allocated  to  the  industry  in  a  manner 
recommended  by  the  Food  Administration,  given  to  the  purchaser  for 
approval  after  securing  bids,  or  allowed  to  be  made  by  the  purchaser 
direct  in  the  open  market.  The  total  value  of  purchases  cleared 

igee  "  Summary  of  History  of  Prices  during  the  War,"  by  Wesley  C.  Mitchell.  (W.  I. 
B.  Price  Bulletin  No.  1.) 

2  Mr.  Hoover,  in  his  formal  announcement  of  the  creation  of  the  Division  of  Coordina- 
tion  of   Purchase   on   Oct.    24,    1917,   stated   that   its   purpose   was    "  to   coordinate   the 
purchases  of  the  Allies  and  the  Food  Administration  of  such  important  food  supplies  as 
those  mentioned  in  the  President's  proclamation  of  Oct.  8,  1917,  and  to  cooperate  with 
the  Army,  Navy,  and  other  Government  departments  in  an  endeavor  to  coordinate  so  far 
as  practicable  their  purchases  of  such  food  supplies."     The  Food  Section  of  the  War  In- 
dustries Board  was  transferred  to  the  Food  Administration  a  few  days  prior  to  the  above 
announcement,  on  Oct.  15,  1917,  and  became  part  of  the  new  Division  of  Coordination  of 
Purchase. 

3  See  letters  dated  Nov.  21,  1917,  and  sent  by  Mr.  Hoover  to  Allied  provisions  export 
commission,  American  Red  Cross,  Commission  for  Relief  in  Belgium,  financial  attache1  of 
the  Russian  embassy,  the  War  Trade  Board,  and  the  Traffic  executive,  outlining  for  them 
the  plan  of  the  Division  of  Coordination  of  Purchase. 


150  HISTORY   OF   PRICES   DURING   THE    WAR, 

i..:  rough  the  Division  of  Coordination  of  Purchase  amounted  to  enor- 
mous figures,1 

Food  Purchase  Board. — Very  shortly  after  the  organization  of  the 
Division  of  Coordination  of  Purchase,  there  was  created  the  Food 
Purchase  Board  with  an  especial  design  to  bring  a  like  coordination  to 
all  food  purchases  for  the  Army  and  Navy.2  Its  function  generally 
was  to  settle  what  commodities  were  to  be  placed  in  the  category  of 
allocated  purchases,  to  define  general  policies  in  method  of  purchase, 
to  secure  costs  from  the  Federal  Trade  Commission,  and  to  recom- 
mend prices  to  the  Army  and  Navy.3  Kepresentation  was  given  on 
that  board  to  the  Secretary  of  War,  the  Secretary  of  the  Navy,  the 
Federal  Trade  Commission,  and  the  United  States  Food  Administra- 
tion. These  branches  of  the  Government  submitted  to  the  Food 
Purchase  Board  their  requirements  for  licensed  staple  commodities 
and  that  board  determined  whether  the  orders  should  be  allocated  to 
the  trade.  If  a  plan  of  allocation  was  advised  by  the  Food  Purchase 
Board,  the  Food  Administration,  with  whom  each  purchaser  filed  a 
statement  of  the  amounts  needed,  distributed  the  allotments  on  a  pro 
rata  basis  throughout  the  country.  The  department  for  whom  the 
allotment  was  made  inspected  the  goods  and,  if  the  goods  were  satis- 
factory, completed  the  purchase.4  The  Food  Administration  record- 
mended  prices  to  the  Army  and  Navy  upon  the  basis  of  cost  inves- 
tigations made  by  the  Federal  Trade  Commission.  Other  agencies 
than  the  War  and  Navy  availed  themselves  to  an  extent  of  the  in- 
struments of  the  Food  Purchase  Board. 

The  whole  scheme  for  the  centralization  of  Government  and  allied 
food  purchases — whether  in  the  Food  Administration  Grain  Cor- 
poration, the  International  Sugar  Committee,  the  Sugar  Equalization 
Board,  or  the  more  comprehensive  Division  of  Coordination  of 
Purchase,  and  Food  Purchase  Board — held  within  its  grasp,  though 
it  did  not  always  exercise,  one  of  the  most  effective  of  all  war  instru- 
ments for  general  food  control. 

1  The  Division  of  Coordination  of  Purchase  during  the  8  months  ending  December,  1918, 
cleared  altogether  food  purchases  amounting  to  $1,069,370,419.  Of  that  total,  the  Allies 
purchased  $715,000,000  ;  the  Army,  Navy,  and  Marine  Corps,  $206,000,000 ;  and  the  Com- 
mission for  Relief  in  Belgium,  Red  Cross,  Salvation  Army,  and  Y.  M.  C.  A.  the  remainder. 
There  follows  a  listing  of  those  purchases  by  kind  of  commodities  : 

Miscellaneous $36,  534,  9SO 

Oils 54,  279,  440 

Sugar 29,  951,  860 


Canned    goods $111,  447,  374 

Dairy  products 30, 113,  288 

Dried  fruits  and  vegetables-  49,  618,  731 
Grains  and  grain  products.  191,  053, 158 
Meat  and  hog  products 566,  371,  588  Total 1,  069,  370,  419 

2  Created  about  Nov.  21,  1917,  at  the  suggestion  of  the  Food  Administrator  ;:n:1 
governmental  authorization  on  May  8,  1918,  by  presidential  proclamation. 

8  These  data  appear  in  the  minutes  of  the  first  meeting  of  the  board  held  Dec.  11,  1017. 
*  Second  annual  report  of  U.  S.  Food  Administration. 


3.  THE  FUEL  ADMINISTRATION. 

Our  war  experience  with  regulation  did  not  bring  forth  a  single 
instance  of  price  fixing,  if  foods  can  be  counted  as  controlled 
though  not  fixed,  which  touched  so  many  people  as  the  coal  prices 
modified  or  fixed  by  the  United  States  Fuel  Administration.  This 
control,  like  that  over  food  prices  and  unlike  most  of  the  other  price 
controls,  was  administered  primarily  for  the  protection  of  the  public 
at  large.  The  Fuel  Administration,  in  so  far,  may  be  thought  simi- 
lar to  the  Food  Administration,  but  unlike  the  price-fixing  com- 
mittee. Beyond  this  point,  however,  the  methods  of  the  Fuel  Ad- 
ministration differ  substantially  from  those  even  of  the  Food  Ad- 
ministration. 

The  points  of  interest  in  a  study  of  war-time  control  over  fuel  are : 
the  problem  that  prompted  fuel  regulation;  the  early  and  informal 
control  that  was  begun  by  the  coal  production  committee  under  the 
Council  of  National  Defense;  the  kind  of  control  over  coal  that  was 
made  possible  by  the  passage  of  the  food  and  fuel  act  in  1917;  the 
original  prices  fixed  at  the  mine  by  the  President  for  bituminous 
and  then  for  anthracite  coal;  the  modifications  made  from  time  to 
time  in  these  prices  by  the  Fuel  Administrator;  the  steps  that  were 
taken  to  control  prices  asked  by  middlemen  and  those  asked  by 
retailers ;  and,  finally,  the  coal  costs  that  came  later  to  be  made  the 
basis  of  all  price  fixing.  It  is  of  importance,  too,  to  know  how  con- 
trol was  exercised  over  coke,  and  to  what  extent,  if  any,  the  Govern- 
ment put  its  hand  upon  the  prices  of  petroleum. 

(i)   THE  WAR-TIME  RISE  IN  COAL  PRICES. 

The  conditions  of  production  which  attach  to  soft  or  bituminous 
coal  used  by  industry  and  comprising  nearly  85  per  cent  of  our  total 
output  of  coal,  and  those  which  attach  to  hard  or  anthracite  coal  used 
by  households  make  coal  prices  ordinarily  an  anomaly  in  price 
phenomenon.  The  abundance  of  supply  and  the  large  numbers  of 
mines,  given  adequate  transportation  facilities,  labor,  and  machinery, 
result  usually  in  the  meeting  of  all  demands  by  the  industry  at  com- 
petitive prices  -slightly  above  the  cost  of  production.1  Coal  prices, 
then,  under  normal  peace-time  conditions,  are  not  as  variable  in  their 

1  See  "  Prices  of  Coal  and  Coke,"  by  C.  E.  Leslicr,  W.  I.  B.  Price  Bulletin  No.  35. 

151 


152  HISTORY   OF   PRICES   DURING  THE   WAR. 

fluctuations  as  those  of  pig  iron,  wheat,  or  cotton.1  The  prices  of 
bituminous  coal,  which  relate  to  the  general  ebb  and  flow  of  in- 
dustrial activities,  are  more  sensitive  to  the  market  than  those  of 
anthracite  coal,  which  relate  more  especially  to  fireside  demands.  The 
price  of  bituminous  coal,  which  was  quoted  at  $0.0752  per  bushel  at 
Pittsburgh  in  1900,  did  not  until  1916  vary  more  than  19  per  cent 
in  any  month  above  that  level,  while  anthracite  coal  (stove)  which 
was  quoted  at  $4.3224  per  ton  in  1901,  did  not  vary  more  than  15 
per  cent.2  Coal  prices  ordinarily  are  stable  prices,  and  large  de- 
viations are  serious  in  their  effects  on  industry  or  the  household. 

There  was  reason  for  concern,  then,  as  nearly  every  industrial 
plant  and  householder  felt  when  coal  prices  suddenly  started  upward 
in  the  latter  part  of  1916  and  kept  rising.  They  had  throughout 
1914  and  1915  clung  safely  near  their  prewar  level  when,  indeed, 
they  had  not  gone  below  it.  But  a  weighted  average  of  bituminous 
coal  prices,  made  from  prices  taken  in  all  districts  of  the  United 
States,  shows  that  the  quoted  general  price  of  that  coal  leaped  in 
July,  1916,  from  its  prewar  level  of  $1.30  per  net  ton  to  $3.46  by 
December  following.3  Likewise  a  weighted  average  of  anthracite 
coal  prices,  made  from  our  total  egg,  stove,  chestnut,  pea,  and  steam 
production,  rose  from  $2.92  in  May,  1916,  to  $4.11  by  May,  1917. 
These  extraordinary  rises  in  prices  are  without  precedent  in  coal 
history  since  1890,  if  ever. 

The  imminent  and  widespread  concern  of  manufacturers  and  house- 
holders, as  they  faced  high  prices  in  the  prosperous  year  1917,  was 
not  alone  that  coal  had  soared  to  heights  unknown,  but  that  coal  at 
any  price  was  uncomfortably  scarce.  The  war-time  production 
orders,  together  writh  the  excessively  cold  winter,  were  making 
heavier  demands  upon  the  coal  stocks  than  ever  before  and  threat- 
ened a  serious  coal  shortage.  Curiously,  when  it  was  most  neces- 
sary to  carry  coal  from  the  mines  to  central  distributing  points,  the 
railroad  system  became  so  heavily  loaded  that  congestion  set  in  and 
thousands  of  tons  of  coal  were  left  standing  at  the  mines  for  lack 
of  empty  cars  and  transportation  facilities.  This  unusual  situation 
upset  the  coal  market  completely  for  the  first  time  in  years  and  dis- 
turbed beyond  immediate  recovery  the  nice  balance  between  the  pro- 
duction, the  cost,  and  the  market  price  for  coal. 

There  is  listed  below  a  series  of  data  by  which  may  be  compared 
month  by  month  from  January,  1913,  to  December,  1918,  the  total 

1  The  stability  of  coal  prices  is  due  in  part  to  the  fact,  that  the  wages  of  labor,  which 
do  not  fluctuate  greatly,  constitute  nearly  80  per  cent  of  the  cost  of  coal  production. 

2  Wholesale  Prices  1890  to  1916,  by  Bureau  of  Labor  Statistics,  Bulletin  No.  226. 

3  In    Ohio    and    Pennsylvania    the    increase   was   the    greatest,    the   highest    spot    price 
-recorded  being  more  than  400  per  cent  above  the  prewar  Jevel,  with  the  smokeless  coals 

of  West  Virginia  and  the  high-grade  coal  from  the  Georges  Creek  district  of  Mary- 
land next  approaching  in  extent  of  rise  in  price. 


GOVERNMENT    CONTROL    OVER   PRICES. 


153 


production  of  bituminous  coal  in  this  country,1  and  the  weighted 
market  prices  at  which  it  sold.2  A  ready  comparison  of  the  varia- 
tion in  production  and  prices  has  been  facilitated  by  the  reduction 
of  each  actual  figure  to  a  relative  figure,  using  the  respective  prewar 
figures  (average  from  July  1,  1913,  to  June  30, 1914)  as  a  base  equal 
to  100  in  each  case.  The  figures  have  been  extended  beyond  the 
time  when  control  set  in  for  reference  later  when  an  inquiry  will  be 
made  into  the  effectiveness  of  that  control. 

PRODUCTION   OF   BITUMINOUS  COAL  IN   THE   UNITED   STATES. 

ACTUAL   PRODUCTION   (SHORT  TONS). 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January  
February     ... 

4$,  276,  273 
37.  056.  985 

40,187,739 
35,472,535 

37,  190.  800 
29,  321,  443 

48,  596,  094 
45,  186,  515 

47,967,354 
41,352,711 

42,607,000 
44,385,000 

March 

37  535  421 

45  454  707 

31  800  830 

43  821  604 

47  868  652 

48,631,000 

April.  .  . 

34,168,980 

23,609,695 

29,  968,  240 

33,628,164 

41,854,320 

46,591,000 

May 

37  204  880 

28  551  219 

30  938  134 

38  803  759 

47  086  452 

50  927  000 

June 

37'  40  1'  953 

31  '411  952 

33'  956'  818 

37  741  972 

46'  824'  646 

51  758'000 

3  ulv  

38,857,653 

34,  305,  418 

35,  573,  809 

38,  113,  105 

46,291,572 

55,  587)  000 

August     

41  589,  085 

37  751,578 

38,160  995 

*2  695  735 

47,372  226 

55,732  000 

September 

41  423  798 

39  018  756 

40  963  780 

42  098  831 

45  107  956 

51  757  009 

October  

46,  164,  649 

37,  685,  182 

44,  197,  763 

44,  807,  205 

48,  337,  726 

52,886,000 

November.    .  . 

43  233,145 

33  392  681 

44  736  760 

44  927  817 

47  689,801 

44  387  000 

December 

41  519  477 

35  862  508 

45  814  754 

44  097  744 

44  037  147 

40  635  000 

Year 

478,  435,  297 

422  703  970 

442  624  426 

502  518  545 

551  790  563 

585,883  000 

WEIGHTED  AVERAGE  "SPOT' 


PRICES   OF  ALL   BITUMINOUS  COAL  IN  THE  UNITED 
STATES. 


ACTUAL  PRICE.0.  PER  NET  TON. 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January 

$1  47 

$1  27 

$1  20 

$1  54 

|3  73 

$2  60 

February  .  .  . 

1.29 

1.24 

.19 

.44 

3.75 

2.64 

March..     . 

1.25 

1.24 

17 

33 

3  53 

2  67 

Anril 

1  24 

1  24 

16 

32 

3  00 

2  71 

May... 

.23 

1.24 

.16 

.29 

3.72 

2.75 

June  . 

23 

1  21 

15 

33 

3  77 

2  66 

July  

.25 

1.20 

.14 

.30 

2.98 

2.66 

.A  UfJUSt    .       ... 

28 

1  21 

15 

.35 

3.03 

2.67 

September 

29 

1  20 

18 

56 

2  12 

2.67 

October.   ...                       . 

1.33 

1  21 

.20 

2.11 

2.15 

2.67 

November 

1  35 

1  19 

23 

3  36 

2  58 

2.67 

Dec-ember 

1  28 

1  20 

36 

3  46 

2  59 

2  67 

Year. 

1  29 

1  22 

i  19 

78 

3  08 

2.67 

1  The    production    figures    represent    those    adopted    officially    by    the    United    States 
Geological   Survey  and   the  United   States  Fuel   Administration   for   the  years  given. 

2  The  weighted  average  market  prices  for  bituminous  coal,  representing  a  grand  average 
of   prices   from   all   districts   of   the   United    States,    were    compiled    especially   by   C.    E. 
Lesher,   of  the  Fuel   Administration,   from   the  Coal   Age.     The  mean   of  the  high   and 
low    weekly    quotations,    where    necessary,    were   reduced    to    a    net   ton    basis    and    to 
f.   o.   b.   mines   by   deducting  the  freight  rate  in   effect  at   the  particular  time,   and  re- 
duced then  to  monthly  prices  by  taking  simple  averages.     A  single  quotation  was  then 
obtained  for  each   coal  for  each  month  by   averaging  the  quotation  for  prepared  sizes, 
run-of-mine,    and    slack   or   screenings    in   accordance   with   the    proportion    of  each   size 
produced  in  each  field  in  1917.     The  final  grand  weighted  average,  therefore,  representing 
an  examination  of  35,000  quotations,  shows  the  "  spot  "  prices  for  15  bituminous  coals. 
It  should  be  borne  in   mind  that   the   contract  prices,   at  which  a  bulk   of  coal   sold, 
did  not  rise  as  high  as  the  "  spot "  prices  quoted  above  nor  did  the  smaller  production 
of  anthracite  coal  undergo  such  phenomenal  rises  as  the  bituminous  coal  quoted  above. 


154  HISTORY   OF   PRICES   DURING   THE    WAR. 

PRODUCTION    OF    BITUMINOUS    COAL    IN    THE    UNITED 

RELATIVE   PRODUCTION. 


Month. 

1913 

1914 

1915 

1916 

1917 

191S 

January 

111 

105 

98 

122 

126 

112 

February  .  .  . 

97 

93 

77 

118 

108 

116 

March 

98 

119 

83 

115 

126 

128 

April.. 

90 

62 

79 

88 

110 

122 

May. 

98 

81 

102 

124 

134 

June 

98 

82 

89 

99 

123 

136 

July.    .             

102 

90 

93 

100 

121 

146 

August 

109 

99 

100 

112 

124 

140 

September  

109 

102 

107 

110 

118 

136 

October 

121 

99 

116 

118 

127 

139 

November  

113 

88 

117 

118 

125 

116 

December. 

109 

94 

120 

116 

116 

107 

Year                                     .   . 

105 

92 

97 

110 

121 

128 

WEIGHTED    AVERAGE 


'SPOT"  PRICES   OF  ALrL  BITUMINOUS  COAL   IN  THE   UNITED 

STATES. 

RELATIVE  PRICES. 


Month. 

1913 

1914 

1915 

1916 

1917 

191- 

Januarv  

116 

100 

94 

121 

294 

203 

February 

102 

98 

94 

113 

295 

203 

March 

98 

93 

92 

105 

278 

210 

April 

93 

93 

91 

104 

236 

213 

May  

97 

98 

91 

102 

293 

217 

June. 

97 

95 

91 

105 

297 

209 

July'  

98 

94 

90 

102 

235 

209 

August 

101 

95 

91 

106 

239 

210 

September  

102 

94 

93 

123 

167 

210 

October.. 

105 

95 

94 

166 

169 

210 

November 

106 

94 

97 

265 

203 

210 

December  

101 

94 

107 

272 

204 

210 

Year  

102 

96 

94 

140 

243 

210 

The  market  prices  of  coal  in  this  country,  far  from  maintaining 
their  usual  relation  to  production,  took  a  spurt  which  landed  them 
at  unprecedented  heights,  and  alarmed  the  Government  at  Washing- 
ton early  in  1917.  It  was  apparent  that  the  Government  sooner  or 
later  must  assume  some  sort  of  control  over  coal  prices  with  a  view 
quite  as  much  to  stimulating  production  as  of  protecting  consumers 
against  a  further  rise. 

(2)   THE  COAL  PRODUCTION  COMMITTEE. 

The  intermediate  step  leading  to  the  final  Government  control 
over  coal,  as  was  wont  during  war  time,  was  taken  by  the  Council 
of  National  Defense  through  the  voluntary  organization  of  a  trade 
committee.  The  council,  impressed  with  the  necessity  for  some  form 
of  action  to  stimulate  production,  appointed  a  committee  on  coal 
production  on  April  27,  1917.1  This  committee  believed  at  the  out- 
set that  the  increased  domestic  needs  and  those  of  the  Allies  would 

1  Mr.  Francis  S.  Peabody,  a  large  dealer  in  coal,  was  made  chairman  of  this  committee, 
composed  of  various  men  of  the  coal  industry  in  cooperation  with  mine  workers,  coke 
producers,  distributors,  consumers,  transportation  agencies,  the  Geological  Survey,  the 
Bureau  of  Mines,  and  the  Department  of  Labor. 


GOVERNMENT   CONTROL  OVER   PRICES.  155 

push  the  1917  requirements  far  in  excess  even  of  the  bumper  produc- 
tion of  1916.1  With  the  assistance,  accordingly,  of  the  Bureau  of 
Mines  and  the  Geological  Survey,  a  survey  of  the  coal  situation  was 
made  which  revealed  that  the  limiting  factors  in  meeting  the  coal 
requirements  were  the  shortage  of  mine  workers  and  the  inadequacy  / 
of  distributing  facilities.2  The  potential  capacity  was,  of  course,  in. 
excess  of  the  maximum  requirements.  The  early  war-time  control 
of  fuel  later  taken  over  by  the  Fuel  Administration  can  not  be  un- 
derstood without  taking  serious  account  of  the  1,700,000- ton  Navy 
order  placed  by  the  early  coal  production  committee,  the  agreement 
made  with  the  industry  upon  the  Peabody-Lane  prices,  and  their 
immediate  repudiation  by  the  Secretary  of  War. 

THE  1,700,000-Tox  XAVY   ORDER. 

The  Navy  Department,  unable  to  secure  bids  for  supplying  the 
coal  needed  by  its  battleships,  called  upon  the  committee  on  coal 
production  to  negotiate  a  satisfactory  purchase.  The  committee, 
early  in  June,  1917.  called  the  coal  producers  to  Washington  for  con- 
ference. The  producers,  already  well  loaded  with  orders,  promised 
to  deliver  the  full  1,700,000  tons  required  at  a  suggested  price  of 
$2.95  per  ton.  Secretary  of  Navy  Daniels,  regarding  that  price  as 
excessive,  gave  orders  June  19,  or  thereabouts,  under  the  authority  of 
the  naval  act,  that  coal  producers  prepare  to  furnish  the  required 
tonnage  at  an  allowance  of  $2.335  per  gross  ton  f.  o.  b.  mines.  The 
final  price,  he  announced,  would  be  determined  later  when  the  Federal 
Trade  Commission  had  completed  its  inquiry  into  costs,  and  might  be 
adjusted  to  a  point  below  or  in  excess  of  that  price.3  The  firmness 
which  characterized  this  mandatory  order,  and  its  insistence  upon 
an  initial  price  far  below  the  market  or  even  that  asked  by  the  pro- 
ducers, made  the  coal  dealers  realize  that  regulation  of  some  form 
was  within  sight. 

THE  PEABODY-LANE  PEICES. 

The  coal-production  committee,  fully  aware  of  the  necessity  for 
fostering  the  increased  production  that  had  already  set  in,  called 
about  400  of  the  coal  producers  again  to  Washington  during  the  last 
week  of  June  to  discuss  methods  of  reducing  the  prices  of  coal  to  the 
Government  and  to  the  public.  These  producers,  at  a  three-day 
conference  held  in  the  new  Interior  Building,  met  with  the  commit- 

1  The   production   of   502,518,545    tons  of   bituminous   coal    in   1916,    though    exceeded 
both  in  1917  and  1918,  was  a  high  record  for  the  industry  at  the  time  the  Government 
faced  the  necessity  for  increased  production  early  in  1917. 

2  Report  of  F.  S.  Peabody  made  to  the  Council  of  National  Defense,  and  printed  in  its 
first  annual  report,  p.  33. 

3  See  the  Peabody  report  referred  to  above,  and  an  announcement  made  by  the  Navy 
Department  printed  in  the  Official  Bulletin  for  June  19,  1917. 


156  HISTORY   OF   PRICES   DURING  THE   WAR. 

toe  and  conferred  with  Secretary  of  the  Interior  Lane,  Secretary  of 
the  Navy  Daniels,  John  T.  Fort,  of  the  Federal  Trade  Commission, 
which  was  investigating  coal  costs,  and  other  officials.  The  outcome 
of  this  conference,  at  which  price  fixing  was  freely  discussed  and 
tentative  maximum  prices  for  coal  agreed  upon,  is  peculiarly  sig- 
nificant in  the  light  of  later  coal  control. 

Secretary  Lane,  strongly  backing  the  action  of  the  coal-production 
committee,  was  especially  instrumental  in  finally  drawing  to  a  head 
on  June  28  a  voluntary  agreement  by  the  bituminous  producers  to 
set  a  maximum  price  of  $3.50  per  ton  for  domestic  lump,  egg,  and 
nut  coal,  and  a  maximum  of  $3  per  ton  for  run-of-mine  coal  to  be 
effective  on  July  I.1  These  agreed  prices,  prior  to  any  actual  price 
fixing  by  the  Government,  were  distinctly  lower  than  the  quoted 
prices  for  various  districts.  Indeed,  the  weighted  average  price  of 
all  bituminous  coal  for  June  was  as  high  as  $3.77  per  ton.  Not  only 
did  the  coal-production  committee  agree  with  the  operators  at  that 
early  time  upon  tentative  maximum  prices  for  coal  but  likewise 
upon  jobber,  broker,  and  retailer  commissions.  These  latter  dealers, 
it  was  determined,  would  be  allowed  to  charge  no  more  than  one 
commission,  and  that  not  in  excess  of  25  cents  per  ton.  It  is  note- 
worthy that  the  producers,  although  informally  agreeing  upon  the 
above  tentative  prices,  appointed  committees  and  formally  au- 
thorized them  and  the  Government  to  fix  further  prices.2 

1  Secretary  Franklin  K.  Lane  in  a  letter  to  F.  S.  Peabody  dated  June  28,  1917,  said  : 
"  I  feel  that  the  present  extremely  high  prices  on  coal  require  immediate  action  by  the 
coal  operators,  and,  therefore,  would  urge  upon  you  that  they  should  be  reduced  at  once 
and  maximum  prices  fixed  which  would  apply  to  sales  on  and  after  July  1,  1917,  and 
continue  until  such  time  as  the  investigation  which  you  propose  into  costs  and  conditions 
shall  warrant  a  reduction  or  increase.     These  prices  should  not  be  used  to  affect  present 
contracts  or  apply  to  export  or  foreign  trade.     In  other  words,  the  people  of  the  United 
States  should  have,  as  I  urged  upon  the  operators  the  other  day,  immediate  relief  and 
knowledge  of  their  disposition  to  make  a  reasonable  price  irrespective  of  the  possibilities 
of  obtaining  higher  prices.     This  would  be  regarded  by  the  people  as  meeting  the  situ- 
ation promptly  and  wisely  if  the  prices  materially  cut  those  which  exist.*' 

2  A   report    of   the   proceedings    of   this   meeting,   as   printed    in    the   Commercial   and 
Financial  Chronicle  for  June  30,   1917,   shows  that  the  producers  resolved   that  "  these 
committees  report  forthwith  to  the  Secretary  of  the   Interior,   the  Federal   Trade  Com- 
mission, and  the  committee  on  coal  production  of  the  Council  of  National  Defense,  costs 
and  conditions  surrounding  the  production  and  distribution  of  coal  in  each  district  and 
that  these  committees  are  authorized,  in  their  discretion,  to  give  assent  to  such  maxi- 
mum prices  for  coal  f.  o.  b.  cars  at  mines  in  the  various  districts  as  may  be  named  by 
the  Secretary  of  the  Interior,  the  Federal  Trade  Commission,  and  the  committee  on  coal 
production  of  the  Council  of  National  Defense. 

"  This  convention  by  resolution  heretofore  adopted  having  requested  the  Secretary  of 
the  Interior,  the  Federal  Trade  Commission,  and  the  committee  on  coal  production  to 
fix  a  fair  and  reasonable  price  at  which  the  several  operators  in  the  several  coal  districts 
of  the  United  States  shall  sell  coal,  do  hereby  further  authorize  said  Government  repre- 
sentatives, so  named  in  said  resolution,  to  forthwith  issue  a  statement  fixing  a  tentative 
maximum  price,  which,  in  their  judgment,  is  fair  and  reasonable  as  applied  to  the  several 
coal  districts,  at  which  coal  shall  be  sold  from  and  after  the  1st  day  of  July  next 
and  until  the  accurate  costs  have  been  ascertained  and  a  fair  and  reasonable  price  based 
thereon  fixed  by  said  Government  agencies  designated  under  said  resolution." 


GOVERNMENT   CONTROL   OVER   PRICES.  157 

A  full  account  of  this  historic  coal  meeting  with  the  bituminous 
producers  and  the  Peabody-Lane  prices  that  were  established,  as 
authorized  by  the  Department  of  the  Interior  follows :  1 

As  a  result  of  the  conference  between  the  mine  operators,  the  Secretary  of 
the  Interior,  Federal  Trade  Commissioner  Fort,  Chairman  Peabody,  and  the 
committee  on  coal  production  of  the  Council  of  National  Defense,  the  following 
reductions  were  made  to  go  into  effect  July  1  next  in  the  prices  of  coal.  This, 
according  to  the  statement  of  Director  George  Otis  Smith,  of  the  Geological 
Survey  of  the  Interior  Department,  will  effect  a  reduction  to  the  consumers 
east  of  the  Mississippi  River  of  $15,000,000  a  month,  based  on  the  output  of 
free  coal  in  May  of  this  year.  These  prices  are  maximum  prices  per  ton  of 
2,000  pounds  aboard  the  cars  at  mine  pending  further  investigation.  These 
prices  do  not  affect  in  any  way  contracts  in  existence  or  sales  of  coal  for 
foreign  or  export  trade. 

The  operators  tendered  to  the  Government  a  reduction  from  these  reduced 
prices  of  50  cents  per  ton  for  coal  that  the  Government  may  need. 

No  action  was  taken  upon  anthracite  prices,  because  of  the  fact  that  these 
prices  had  already  been  acted  upon  by  the  Federal  Trade  Commission. 

Twenty-five  cents  per  net  ton  was  fixed  as  the  maximum  price  for  coal  jobbers' 
commission,  with  only  one  commission,  no  matter  how  many  jobbers'  hands  the 
coal  may  pass  through. 

On  account  of  an  inadequate  representation  of  operators  west  of  the  Missis- 
sippi River,  no  maximum  prices  were  fixed  for  coal  from  those  districts.  A 
supplementary  statement  will  be  issued  within  a  few  days  covering  prices  on 
coal  produced  in  those  districts. 

The  action  taken  at  this  conference  brings  about  the  following  results :  Pres- 
ent prices  on  bituminous  coal  mined  in  Pennsylvania  have  ranged  frtun  $4.75  to 
$6.  Under  the  ruling  the  price  is  reduced  to  $3  for  mine  run  and  $3.50  for 
domestic  lump,  egg,  and  nut. 

The  present  range  of  prices  in  West  Virginia  is  from  $4.50  to  $6;  price 
reduced  to  $3  for  mine  run  and  $3.50  for  domestic  lump,  egg,  and  nut. 

The  range  of  prices  for  Ohio  coal  has  been  from  $4.50  to  $5 ;  prices  reduced  to : 
No.  8  district,  the  thick  vein  Hocking  and  Cambridge  districts,  $3  for  mine  run 
and  $3.50  for  domestic  lump,  egg,  and  nut ;  thin  vein  Hocking,  Pomeroy,  Cooks- 
ville,  Coshocton,  Columbiana  County,  Tuscarawas  County,  Amsterdam-Bergholz 
district,  $3.25  for  mine  run  and  $3.50  for  domestic  lump,  egg,  and  nut;  the 
Massilon  and  Palmyra  districts,  and  Jackson  County,  $3.50  for  all  grades  of  coal. 

The  prevailing  prices  in  Alabama  have  been  from  $5.50  to  $5.75 ;  prices  reduced 
to:  Cahaba  and  Black  Creek,  $4;  Prat,  Jaeger,  and  Corona,  $3.50;  Big  Seam, 
$3  for  all  grades. 

The  prevailing  prices  for  coal  mined  in  Maryland  have  been  from  $5.75  to 
$5 ;  reduced  prices  will  be  $3  for  mine  run  and  $3.50  for  domestic  lump,  egg, 
and  nut. 

The  prevailing  prices  on  coal  mined  in  Virginia  have  been  $4.50  to  $5  ;  reduced 
price,  $3  for  mine  run  and  $3.50  for  lump,  egg,  and  nut. 

The  prevailing  prices  on  coal  mined  in  Kentucky  have  been  from  $4  to  $4.50 ; 
reduced  price,  $3  for  mine  fun  and  $3.50  for  the  domestic  sizes. 

The  prevailing  prices  on  coal  mined  in  Illinois  and  Indiana  have  been  from 
$3.50  to  $4;  reduced  price,  $2.75  for  mine  run  and  steam  sizes  and  $3.50  for 

1  Issued  June  28,  1917,  by  the  Secretary  of  the  Department  of  Interior  and  printed  in 
full  in  the  coal  hearings  before  the  subcommittee  of  the  Senate  Committee  on  Manufac- 
tures, pursuant  to  Senate  resolution  163,  Sixty-fifth  Congress,  second  session. 


158  HISTORY   OF   PRICES   DURING   THE   WAR. 

screened  domestic  sizes,  50  cents  per  ton  above  these  prices  in  the  long-wall 
Held  of  northern  Illinois,  Assumption,  and  Murphreesboro. 

The  prevailing  prices  on  coal  mined  in  Tennessee  have  been  from  $4.50  to 
$5 ;  reduced  price,  $3.50  for  all  sizes. 

Secretary  Lane,  with  the  coal  production  committee,  highly  pleased 
at  the  outcome,  sent  the  coal  operators  home  happy  by  a  closing  ad- 
dress, declaring  "this  is  a  very  novel  proceeding.  I  think  I  am 
within  the  fact  when  I  say  that  no  such  hearing  or  gathering  as  this 
has  ever  been  held  in  the  United  States  before,  or  perhaps  in  the 
world.'5  l 

THEIR  REPUDIATION  BY  SECRETARY  BAKER. 

Scarcely  had  the  Peabody-Lane  prices  been  agreed  upon  and  the 
operators  had  reached  their  homes  then  the  agreement  was  flatly  de- 
nounced and  repudiated  by  Secretary  of  War  Baker.  The  Secre- 
tary of  War,  who  was  president  of  the  Council  of  National  Defense 
and  therefore  in  authority  over  the  Peabody  coal  production  com- 
mittee, wrote  to  the  director  of  the  council  on  June  30,  characteriz- 
ing the  whole  proceeding  of  the  coal  meeting  as  misleading  and  dis- 
claiming any  authority  for  price  fixing.2  This  show  of  seeming 

1  Senate  hearings  referred  to  above. 

2  The  letter  written  to  W.  S.  Gifford,  Director  of  the  Council  of  National  Defense,  by 
Newton  D.  Baker,  its  president,  on  June  30,  1917,  follows  in  full : 

"  My  attention  has  been  called  through  the  newspapers  to  the  action  reported  to  have 
been  taken  at  Washington,  D.  C.,  during  the  past  week  by,  the  so-called  committee  on  coal 
production  of  the  Council  of  National  Defense,  in  cooperation  with  certain  coal  producers 
and  representatives  of  coal-mining  enterprises,  with  regard  to  the  price  of  bituminous  and 
anthracite  coal. 

"  The  facts  seem  to  be  that  the  coal  production  committee  invited  to  Washington  various 
coal  operators  and  arranged  conferences  between  them,  members  of  the  coal  production 
committee,  and  members  of  the  Federal  Trade  Commission,  leading  to  the  adoption  of  reso- 
lutions in  favor  of  an  early  and  accurate  determination  of  the  costs  involved  in  the  pro- 
duction of  bituminous  and  anthracite  coal,  as  a  basis  for  some  future  action  by  some  offi- 
cial agency  of  the  Government  in  fixing  fair  and  just  prices  for  these  products,  should  any 
such  agency  be  given  power  to  do  so.  Pending  such  an  ascertainment  of  costs  this  inert 
ing  seems  to  have  adopted  a  resolution  whereby  the  operators  present  agreed  to  sell 
l-ituniinous  coal  at  a  price  not  higher  than  $3  per  ton,  and  that  this  obligation  should 
re  main  in  force  until  some  such  action  had  been  taken,  by  an  authorized  governmental 
agency. 

"  The  color  which  has  been  given  to  this  meeting  and  this  resolution  in  the  newspaper.-. 
may  well  mislead  the  public  into  believing  that  the  Council  of  National  Defense  has  either 
undertaken  itself  to  fix  the  price  of  coal,  or  to  sanction  its  being  fixed  by  the  coal  pro- 
duction committee,  or  that  cornniitttee  in  conjunction  with  the  coal  operators.  I,  there- 
fore, as  president  of  the  Council  of  National  Defense,  write  to  say  that  the  Council  of 
National  Defense  has  no  legal  power,  and  claims  no  legal  power,  either  to  fix  the  price  of 
coal,  or  to  fix  a  maximum  price  for  coal  or  any  other  product.  The  coal  production  com- 
mittee is  a  subordinate  committee  of  the  Council  of  National  Defense,  purely  advisory  ia 
its  character,  formed  for  the  purpose  of  advising  the  council  as  to  steps  which  might  bo 
recommended  leading  to  a  stimulation  of  production  and  distribution  of  coal.  No  power 
has  been  even  attempted  to  be  delegated  to  it  to  consider  or  deal  with  the  question  of 
price,  and  any  action  taken  by  that  committee,  or  sanctioned  by  that  committee,  dealing 
with  price,  either  fixed  or  maximum  for  coal,  is  clearly  beyond  the  legal  power  of  the 
coal  production  committee  and  of  the  Council  of  National  Defense  from  which  the  com- 
mittee derives  whatever  authority  it  has. 

"As  you  are  aware,  the  Federal  Trade  Commission  has  been  directed  by  the  President 
to  ascertain  for  his  information  the  costs  involved  in  coal  production.  I  am  to  some 


GOVERNMENT   CONTROL   OVER   PRICES.  159 

dissension  within  the  Government  threw  chaos  into  the  ranks  of  the 
producers  and  uncertainty  whether  the  agreement  was  or  was  not 
longer  binding  upon  them  or  upon  the  Government.1  The  whole 
affair,  believed  by  Secretary  Baker  to  be  a  dangerous  precedent  and 
destined  to  forestall  a  firmer  control  by  the  Government,  produced  a 
situation  of  utter  confusion.2 

It  appears  that  the  failure  of  officials  to  agree  among  themselves 
upon  an  immediate  relief  to  the  coal  situation,  and  the  threatening 
shortage,  provoked  rather  serious  discussion  in  several  States  dur- 
ing the  summer.  Ohio,  Indiana,  Illinois,  Wisconsin,  and  others, 
through  their  State  councils  of  national  defense,  began  to  plan  in- 
dependent action.  Scores  of  individual  letters  from  various  sections 
showed  clearly  that  the  rising  prices  and  the  coal  shortage  were 
touching  the  people  to  the  quick.3  The  Illinois  Council  of  National 

extent  familiar  with  the  progress  made  by  the  commission.  The  information  I  have  from 
that  and  other  sources,  I  think,  justified  me  in  believing  that  the  price  of  $3  suggested, 
or  agreed  on,  as  a  maximum,  is  an  exorbitant,  unjust,  and;  oppressive  price. 

"  The  fact  that  these  conferences  were  attended  by  members  of  the  Federal  Trade  Com- 
mission, and  by  members  of  the  Council  of  National  Defense,  of  course  adds  nothing  to 
their  legal  powers,  and  I  am  sure  that  none  of  my  associates  in  the  council  will  dissont 
from  the  view  that  I  have  herein  expressed,  both  on  the  limitation  upon  the  powers  of  the 
council  and  the  coal  production  committee,  and  the  effect  of  the  action  alleged  to  have 
been  taken. 

"I  write  this  for  the  information  of  the  coal  production  committee,  and  for  the 
guidance  of  all  other  subcommittees  of  the  council." 

1  An  especially  lucid  definition  of  the  general  price  function*  of  the  Council  of  National 
Defense  as  he  saw  them  and  as  provoked  by  the  coal  meeting  was  made  by  Newton  D. 
Baker  in  a  letter  to  Director  W.  S.  Gifford  on  July  13,  1917. 

2  Francis  S.  Peabody,  after  the  repudiation  of  the  coal  prices  by  Secretary  Baker,  wrote 
Director  Gifford  the  following  letter,  in  part,  on  July  13,  1917 : 

"  The  letter  of  the  Secretary  of  War  of  June  30,  criticizing  the  tentative  maximum 
prices  established  for  bituminous  coal,  and  the  action  of  the  committee  on  coal  produc- 
tion, has  created  a  serious  condition  in  the  industry.  Unless  some  definite  announcement 
is  made  at  once,  by  the  Council  of  National  Defense,  which  will  remove  existing  uncertain-, 
ties  and  promptly  reestablish  the  active  production  and  distribution  of  coal,  hardship  and 
suffering  will  result  this  winter. 

"  The  Secretary's  letter  carrying  such,  weight,  as  it  naturally  would,  with  the  public, 
and  characterizing  the  tentative  prices  as  it  does,  has  produced  in  the  minds  of  a  great 
number  of  consumers  the  expectation  that  by  deferring  their  purchases  they  would  obtain 
their  supplies  at  figures  below  those  heretofore  named.  The  natural  and  inevitable  result 
of  these  uncertainties  is  that  the  buying  of  bituminous  coal  for  storage  purposes  has  prac- 
tically ceased,  and  normal  current  stocking  is  gravely  threatened.  *  *  * 

"  The  sentiment  of  the  operators,  as  expressed  in  the  convention,  had  a  marked  effect 
on  prices,  even  before  any  definite  action  had  been  taken,  and  before  the  convention  ad- 
journed prevailing  abnormally  high  prices  had  substantially  disappeared.  With  deference 
to  the  opinion  of  Secretary  Baker,  as  expressed  in  his  letter,  I  still  adhere  to  the  opinion 
that  the  action  of  this  convention  which  resulted  in  the  establishment  of  tentative  maxi- 
mum prices,  pending  the  conclusion  of  the  investigation  of  costs  of  production  being 
made  by  the  Federal  Trade  Commission,  was  not  only  wisely  taken  but  was  absolutely 
necessary  to  stimulate  production,  stabilize  market  conditions,  and  secure  equitable  distri- 
bution of  coal  to  the  people  at  fair  and  reasonable  prices." 

3  The  following  letter  from  CoL  A.  M.  Shook,  dated  June  16,  1917,  and  showing  the 
disquiet  in  Tennessee  over  the  coal  situation,  was  typical  of  others : 

V  In  this  particular  section  the  question  of  fuel  is  to-day  the  most  vital  one.  The 
abnormal  demand  for  coal  is  such  that  mine  operators  are  enabled  to  sell  their  output 
at  prices  varying  from  100  to  300  per  cent  above  prevailing  prices  of  one  year  ago.  I 
see  no  way  to  remedy  these  conditions  except  by  Federal  legislation.  As  long  as  the 
consumer  will  agree  to  pay  from  $3  to  $5  per  ton  for  coal  that  was  selling  a  year  ago 


160  HISTORY   OF   PRICES   DURING   THE   WAR. 

Defense,  indeed,  went  so  far  as  to  discuss  seizure  of  the  mines  by  the 
State,  independent  of  the  National  Government.1  The  pressure  of 
the  State  councils  of  national  defense  from  the  northern  Middle 
States — Illinois,  Indiana,  Iowa,  Kansas,  Kentucky,  Michigan,  Minne- 
sota, Missouri,  Nebraska,  North  Dakota,  Ohio,  South  Dakota,  and 
Wisconsin — which  was  exerted  upon  the  national  council  at  a  meet- 
ing in  Chicago  was  a  considerable  factor  in  urging  the  Government 
to  action. 

(3)   THE  FOOD  AND  FUEL  ACT. 

The  alarm  at  the  rising  prices  for  coal,  and  the  distressing  status 
of  its  distribution  prompted  Senator  Pomerene  to  urge,  against  at- 
tack from  several  sides  in  the  Congress,  a  rider  to  the  pending  Lever 
bill,  permitting  the  President  to  fix  coal  prices.  The  President,  too, 
took  a  firm  personal  interest  in  the  coal  problem,  and  finally,  on 
August  10,  1917,  the  food  control  act  was  passed  with  the  Pomerene 
amendment  and  is  now  often  called  the  food  and  control  act.2 
The  Fuel  Administration  was  created  by  the  President  under  the 
authority  given  him  by  this  act.  To  no  other  price-fixing  agency  at 
Washington  were  there  given  such  definite  legal  powers  to  fix  prices 
or  such  sharp  instruments  for  their  enforcement. 

THE  POWER  TO  Fix  COAL  AND  COKE  PRICES. 

The  food  and  fuel  act,  without  any  ado,  gave  authority  to  the 
President,  whenever  in  his  judgment  it  was  necessary  for  the  efficient 
prosecution  of  the  war,  "  to  fix  the  price  of  coal  and  coke,  wherever 
and  whenever  sold,  either  by  producer  or  dealer,  to  establish  rules 
for  the  regulation  of  and  to  regulate  the  method  of  production,  sale, 
shipment,  distribution,  apportionment,  or  storage  thereof  among 
dealers  and  consumers,  domestic  or  foreign." 

at  $1.50  per  ton,  the  operator  will  not  refuse  to  accept  it.  As  a  rule,  here,  the  operator 
is  the  only  beneficiary  from  these  abnormal  prices.  Labor  has  not  been  materially  ad- 
vanced. Freight  rates  are  practically  the  same  as  they  were  a  year  ago.  The  con- 
sumer pays  the  price  and  the  operator  reaps  the  benefit.  These  conditions  will  con- 
tinue unless  legislative  authority  is  placed  somewhere  to  control  these  abnormal  con- 
ditions." 

1  The  committee  on  law  and   legislation   of  the  State  Council   of  Defense  of  Illinois, 
highly  agitated  by  their  failure  to  find  relief  otherwise,  on  Aug.  7,  1917,   recommended 
steps  no  less  drastic  than  the  following  : 

1.  Seizure  by  the  State,  and  operation  by  it  during  the  period  of  the  war,  of  the  coal 
mines  in  this  State. 

2.  Call   an   immediate  meeting  of   representatives  of  the   State   councils  of  the   neigh- 
boring coal-producing  States  so  that  an  adequate  and  uniform  measure  of  relief  can  be 
at  once  contemporaneously  adopted  and  enforced  in  all  these  States. 

3.  Either  separately  or  in  conjunction  with  the  State  councils  of  the  neighboring  coal- 
producing  States,  take  immediate  steps  to  bring  about  the  adoption  of  a  Federal  law  which 
will  give  full  and  sweeping  Federal  powers  of  control  over  prices-  and  distribution  to  an 
administrative  body  possessing  the  machinery  to  render  complete  and  instant  relief. 

2  The  so-called  Pomerene  amendment  was  written  into  the  food  control  act  as  sec.  25. 
(Public  Documents,  No.  41,  65th  Cong.) 


GOVERNMENT   CONTROL,   OVER   PRICES.  161 

ENFORCEMENT   PROVISIONS. 

A  no  less  unusual  feature  of  the  food  and  fuel  control  act  than  the 
breadth  of  its  delegated  powers  was  the  stringency  of  its  enforce- 
ment provisions.  The  fuel  section  of  the  act  not  only  allowed  a  fine 
of  $5,000  or  two  years  of  imprisonment  as  a  punishment  to  violators, 
but  gave  the  President  power  to  requisition  and  take  over  plants 
virtually  at  his  own  will.  The  law  declared,  in  part,  "  that  if,  in  the 
opinion  of  the  President,  any  such  producer  or  dealer  fails  or  neglects 
to  conform  to  such  prices  or  regulations,  or  to  conduct  his  business 
efficiently  under  the  regulations  and  control  of  the  President  as  afore- 
said, or  conducts  it  in  a  manner  prejudicial  to  the  public  interest, 
then  the  President  is  hereby  authorized  and  empowered  in  every  such 
case  to  requisition  and  take  over  the  plant,  business,  and  all  appur- 
tenances thereof  belonging  to  such  producer  or  dealer  as  a  going 
concern,  and  to  operate  or  cause  the  same  to  be  operated  in  such 
manner  and  through  such  agency  as  he  may  direct  during  the  period 
of  the  war  or  for  such  part  of  said  time  as  in  his  judgment  may  be 


necessary." 


(4)   THE  KINDS  OF  FUEL  CONTROL. 


Apparently  the  persuasions  of  the  chairman  of  the  Federal  Trade 
Commission  had  influenced  Senator  Pomerene  to  urge  his  coal 
amendment  to  the  so-called  Lever  bill  in  the  hope  that  coal  control, 
when  begun  by  the  Government,  would  be  delegated  to  the  Federal 
Trade  Commission.  The  clauses  of  the  act  itself  make  frequent 
authorizations  for  coal  control,  referring  over  and  again  to  the  Fed- 
eral Trade  Commission  and  making  no  mention  of  any  other  body  in 
particular.1 

But  the  President,  who  had  started  the  Federal  Trade  Commission 
long  since  upon  an  inquiry  into  coal  costs  and  allowed  it  to  remain  in 
semiofficial  control  for  a  fortnight  after  the  passage  of  the  act,  finally 
set  up  an  independent  body  to  control  coal.  The  Fuel  Administra- 
tion, obliged  to  shape  its  general  plans  of  administration  somewhat 
after  those  written  into  the  law  for  the  Federal  Trade  Commission, 
soon  organized  and  began  a  control  over  distribution,  production, 
conservation,  and  prices. 

1  George  II.  Cushing,  in  an  article  on  "  Ending  the  coal  dilemma,"  in  the  Atlantic 
Monthly  for  November.  1918,  says  in  part :  "  The  Federal  Trade  Commission  had  a  well- 
dofined  ambition  to  control  the  coal  industry.  Indeed,  William  B.  Colver,  now  its  chair- 
man, and  several  of  its  employees  had,  while  the  Lane-Peabody  conference  was  still 
sitting,  appeared  before  a  Senate  committee  to  outline  their  plan  of  control.  At  about 
that  time  Mr.  Colver  had  persuaded  Senator  Pomerene,  of  Ohio,  to  present  his  plan  to 
Congress  as  an  amendment  to  the  Lever  bill  then  under  consideration.  It  is  now  a  part 
of  that  statute." 

12r,547°— 20 11 


162  HISTORY   OF   PRICES   DURING   THE   WAR. 

ORGANIZATION. 

The  President,  who  had  named  a  Food  Administrator  immediately 
after  signing  the  food  and  fuel  act,  did  not  announce  his  appoint- 
ment of  Harry  A.  Garfield  as  Fuel  Administrator  until  August  23, 
1917.  The  new  administrator,  during  the  late  summer  and  early  fall, 
began  the  appointment  of  State  and  local  fuel  administrators  and 
committees.  The  Fuel  Administration  finally  was  organized  some- 
what like  the  Food  Administration,  with  an  hierarchy  of  adminis- 
trators and  committees  penetrating  even  the  smallest  of  the  cities 
in  the  country  and  all  heading  up  to  the  office  at  Washington. 
That  similarity  of  method  was  not  to  be  wondered  at,  since  fuel 
problems,  like  food,  have  peculiarly  local  aspects. 

CONTROL  OVER  DISTRIBUTION. 

The  Fuel  Administration,  impressed  over  and  again  by  the  de- 
mands for  empty  cars,  saw  shortly  that  one  of  its  most  formidable 
problems  would  be  to  effect  a  proper  distribution  of  coal.  The  Sen- 
ate inquiry,  through  the  testimony  of  John  F.  Fort,  of  the  Federal 
Trade  Commission,  had  found  that *  "  transportation  was  the  great- 
est problem  during  the  whole  of  1917,  as  was  pointed  out  in  both 
the  May  and  June,  1917,  reports  of  our  commission.  The  facts 
disclosed  at  the  hearings  and  in  our  investigations  made  it  clear 
that  the  percentage  of  cars  delivered  at  the  mouth  of  the  mine  by 
the  railroads  was  in  almost  all  cases  far  below  the  number  of  cars 
which  the  increased  production  by  the  operators  could  have  used 
if  furnished." 

By  all  odds,  the  most  important  step  taken  for  a  better  distribu- 
tion of  bituminous  coal  orders,  and  that  looking  to  a  relief  in  the 
transportation  congestion  problem,  was  the  establishment  of  a  zone 
system  on  March  22,  1918.2  That  system,  carefully  worked  out 
and  finally  put  into  effect  by  the  joint  efforts  of  the  Fuel  and  Kail- 
road  Administrations,  had  in  mind  the  saving  of  car-miles  and 
offered  a  sure  and  flexible  means  of  controlling  distribution. 

Coal  theretofore  had  been  distributed  practically  without  regard 
to  the  distance  between  the  mine  and  consumer.  The  consumers,  the 
Government,  and  the  distributors  each  to  a  degree  had,  amid  the 
tremendous  shortage  prevailing,  been  guilty  of  carrying  coal  to 
Newcastle.  It  had  been  the  ordinary  thing  for  producers  or  pur- 
chasers to  pass  by  nearer  stores  and  ship  coal  halfway  across  the 
continent  to  satisfy  their  choices  in  selection.  A  plan  was  accord- 

1  Coal  hearings  of  Senate  committee  pursuant  to  Senate  resolution  IGH,  held  December, 
1917,  and  January,  1918. 

3  This  whole  plan  is  outlined  in  full  by  the  Fuel  Administration  in  its  Publication 
No.  21  and  in  its  "  General  Orders,  Regulations,  and  Rulings,"  p.  213-354. 


GOVERNMENT   CONTROL   OVER   PRICES.  163 

ingly  established1  by  which  producers  were  not  allowed,  without 
a  special  permit,  to  sell  coal  beyond  designated  consuming  zones. 
The  main  object  of  the  zone  system  was  to  restrict  eastern  coal  to 
eastern  markets  and  fill  vacancies  in  the  Central  and  Western  States 
with  near-by  coal  produced  in  those  States.  The  zone  system  af- 
fected all  bituminous  coal  except  that  for  railroad  fuel,  coal  for 
movement  on  inland  waterways,  and  coal  delivered  to  Canada.  The 
zones,  which  were  not  made  applicable  either  to  anthracite  coal  or 
coke,  were  made  effective  for  bituminous  and  cannel  coals  on  April 
1,*  1918.  It  would  seem  that  the  methods  for  enforcing  the  zone 
plan  were  efficacious,  since  the  Fuel  Administration  prohibited  the 
distribution  beyond  the  limits  of  the  zones,  and  the  Railroad  Ad- 
ministration helped  to  enforce  them  by  railroad  embargoes. 

The  movements  of  bituminous  coal,  regulated  by  the  zone  system, 
was  about  300,000,000  tons,  or  60  per  cent  of  the  total  production. 
It  was  estimated  by  the  Fuel  Administration  that  there  would  thus  be 
realized  a  saving,  on  the  round  trip  from  and  to  the  mines,  of  almost 
160,000,000  car-miles.  That  saving  was  enough  to  permit  the  same 
cars  to  make  nearly  300,000  additional  trips  from  the  mines,  equiv- 
alent to  an  increase  of  5  per  cent  in  the  production.2 

CONTROL  OVER  PRODUCTION'. 

The  tremendous  exigencies  of  war,  since  this  country  had  never 
in  peace  times  feared  so  gigantic  a  shortage  of  coal,  made  the  in- 

1  These  zones   were  geographical   units   in   which   the   Fuel   Administration,   with   the 
assistance   of   the   Railroad    Administration,    regulated    the    distribution   and    apportion- 
ment of  bituminous  coal.     They  were  designated  by  letters  and  covered  the   following 
territories  :  Zone  A — Missouri,  Arkansas,  Kansas,  Oklahoma,  and  Iowa  ;  zone  B — Minne- 
sota, the  Upper  Peninsula  of  Michigan,   and  Wisconsin  on  the  western  bank  of  Lake 
Michigan,  and  on  Lake  Superior  ;  zone  C — Illinois  ;  zone  D — Indiana  ;  zone  E — western 
Kentucky  ;   zone   F — Virginia,  eastern  Kentucky,   and  Tennessee  ;  zone  G — certain  parts 
of  Tennessee,  Georgia,  and  Kentucky  ;  zone  H — Alabama  ;  zone  K — Ohio ;  zone  L — certain 
parts  of  West  Virginia ;  zone  M — certain  other  portions  of  West  Virginia ;  zone  N — cer- 
tain  other  portions   of  West  Virginia   and   Virginia ;   zone  P — northern  West  Virginia, 
Pennsylvania,  and  Maryland. 

2  The  primary  savings,  contemplated  by  the  Fuel  Administration  in  the  announcement 
of  its  zone  system  on  Mar.  22,  1918,  are  briefly  summarized.     It  was  believed  that,  in 
addition  to  the  saving  in  transportation,   there  could  be  effected  a  retention  of  about 
5,000,000  much-needed  tons  for  the  Eastern   States,  which,   theretofore,   had  gone  west 
all  rail.    The  plan,  it  was  thought,  would  eliminate  the  movement  of  more  than  2,000,000 
tons  of  Pocohontas  coal  to  Chicago  and  other  western  points  over  a  haul  of  660  miles. 
Chicago,  then,  under  the  plan,  would  be  compelled  to  obtain  that  amount  instead  largely 
from  southern  Illinois  mines,  an  average  haul  of  312  miles.     This  change  alone  meant, 
allowing  for  the  differences   in   quality  in  the  two   coals,   a   saving  of  11,400,000  car- 
miles,  or  285,000  car-days.     Such  a  saving,  if  utilized  in  West  Virginia  mines,  wouM 
permit  14  additional  round  trips  of  20  days  each  and  an  additional  production  of  at 
least  700,000  tons  of  Pocohontas  coal. 

In  like  manner  it  was  figured  that  in  the  movement  of  550,000  tons  annually  from 
Kanawha  districts  to  Wisconsin  points  there  could  be  saved  2,500,000  car-miles,  with 
a  consequent  increased  production  of  about  300,000  tons.  A  saving  of  800,000  car-miles 
in  the  movement  from  southeastern  Kentucky  to  Chicago  was  calculated  to  increase  pro- 
duction 50,000  tons.  Still  another  elimination  of  the  Indiana  to  Iowa  movement  was 
figured  to  save  1,600,000  car-miles  and  permit  100,000  tons  additional  production. 


164  HISTORY   OF  PRICES   DURING  THE   WAR. 

crease  of  production  generally  the  primary  concern  in  the  coal  prob- 
lem. It  is  estimated,  in  a  general  way.  that  an  army  uses  10  tons  of 
steel  per  man  each  year.  But  since  it  requires,  on  an  average,  5  tons 
of  coal  to  produce  1  ton  of  steel,  50  tons  of  coal  are  needed  for  each 
soldier.1  The  situation  was  the  more  threatening  since  England, 
which  ordinarily  produces  coal  in  abundance,  had  difficulty  with  her 
coal-production  program  and  had  come  seriously  to  rely  upon  Ameri- 
can coal.  This  statement  is  true,  not  in  the  sense  that  England  took 
to  shipping  that  needed  supply  from  American  ports  to  her  own  in 
the  form  of  coal,  but  in  the  sense  that  she  came  in  large  ways  to  rely 
upon  our  steel,  which  could  be  shipped  with  a  lesser  tonnage. 

The  prices  fixed  tentatively  by  the  early  coal-production  committee 
were  not  accepted,  but  the  Peabody-Lane  agreement  succeeded  in  im- 
pressing industry  with  the  paramount  necessity  for  increasing  pro- 
duction. Mr.  John  F;  Fort,  of  the  Federal  Trade  Commission, 
indeed,  who  took  a  hand  in  the  Peabody-Lane  agreement  with  the 
operators  at  the  three-day  conference  beginning  June  26,  1917,  said 
frankly : 2 

When  we  were  considering  this  question  of  fixing  the  price,  the  question  of 
production  was  the  thing  that  entered  into  the  problem  most  seriously.  The 
coal  output  was  recognized  as  at  that  time  not  to  be  sufficient  to  meet  the  cur- 
rent demands.  The  business  interests  of  the  country  were  perfectly  willing 
to  pay  the  price  fixed  at  that  time,  and  were  paying  a  very  much  larger  price, 
and  to  them  the  question  of  getting  coal  was  more  important  than  the  price. 

The  Fuel  Administration,  facing  an  exceedingly  intricate  problem, 
recognized  in  the  coal  shortage  one  of  its  most  difficult  problems. 
There  has,  for  all  of  that,  been  made  a  charge  that  it  gave  too  much 
emphasis  to  the  price  phases  of  the  problem  and  too  slowly  turned  to 
the  production  phases,  and  that  this  error  resulted  later  in  a  serious 
coal  shortage  in  the  country.3  It  can  not  be  judged  whether  that  was 
true  or  not.  It  would  not,  if  true,  have  been  strange,  since  the  coun- 
try always  has  had  too  much  coal  quickly  to  appreciate  the  serious- 
ness of  a  shortage.  Nor  did  the  country  realize  how  dependent  the 
world  had  become  upon  the  American  supply  in  1917. 

There  is  especial  interest,  in  the  face  of  these  facts  and  with  a 
knowledge  of  the  steps  taken  to  alleviate  the  coal  situation,  to  note 
the  course  of  production  during  1917  and  later.  A  preceding 
table  in  this  chapter  shows  that  the  total  bituminous-coal  production 
in  the  month  of  May,  1917,  was,  in  round  numbers,  41,000,000  tons. 
It  jumped  the  following  month  to  47,000.000  and  remained  relatively 
near  that  figure  each  month  for  the  remainder  of  the  year,  except  for 

1  An  estimate  made  by  George  H.  Cushing. 

2  Senate  hearings  referred  to  above,  p.  854. 

3  This  notion  has  been  especially  urged  by  George  H.  Cushing,  in  the  Atlantic  Monthly 
for  November,  1917,  pp.  589-598. 


GOVERNMENT   CONTROL   OVER  PRICES.  165 

September,  when  it  fell  to  45,000,000,  and  for  December,  when  it  fell 
to  44,000,000.  The  1918  production  remained  near  or  above  50,000,000 
tons  per  month  from  March  until  November.  There  then  began  a 
slump  in  production  which  had  not  yet  disappeared  by  the  early 
summer  of  1919.  The  December,  1918.  production,  although  the  pre- 
ceding months  it  had  been  around  50,000,000,  fell  to  40,000,000  tons. 
In  February,  1919,  it  fell  to  31,000,000  and  did  not  rise  over  2,000,000 
tons  above  that  amount  either  in  April  or  May.  Altogether  1916, 
1917,  and  1918  were,  each  in  their  turn,  all  record,  years  for  the  indus- 
try. The  control  over  coal  production  did,  beyond  any  question, 
stimulate  production.  The  total  production  of  bituminous  coal  in 
this  country  in  1916,  before  Government  regulation  set  in,  was 
502.000.000  tons.  When  Government  control  began,  that  amount  was 
increased  to  551,000,000  tons  in  1917  and  to  585,000,000  tons  in  1918. 

CONTROL  OVER  CONSERVATION. 

It  is  of  passing  interest  in  a  price  inquiry  that  the  Fuel  Adminis- 
tration, though  on  a  much  less  extensive  scale  than  the  Food  Admin- 
istration, did  institute  a  coal  conservation  program.  That  program 
in  the  main,  went  little  further  than  a  cutting  down  of  fuel  for  cer- 
tain nonwar  industries,  the  advocacy  of  lightless  nights,  the  skip- 
stop  systems,  no-coal  days,  and  the  recommendations  against  uses  of 
coal  for  private  yachts  and  for  country  clubs. 

(5)   THE  CONTROL  OVER  COAL  PRICES. 

The  administration,  after  securing  power  from  Congress  to  act, 
found  itself  squarely  under  the  necessity  of  bringing  some  kind  of 
relief  to  the  coal  situation.  The  distribution  and  price  phases, 
whether  or  not  more  fundamental  than  increased  production,  were 
after  all  sorer  points  with  the  people  at  large,  and  they  were  the  first 
to  which  the  Government  turned.  It  is  of  especial  note  that  the 
President  himself,  after  analysis  of  the  Federal  Trade  Commission's 
cost  figures  at  the  White  House,  fixed  the  basic  prices  for  bituminous 
and  later  for  anthracite  coal,  as  well  as  jobbers'  margins,  before  ap- 
pointing a  Fuel  Administrator.  But  prior  even  to  his  putting  a 
hand  upon  the  alarming  rise  in  coal  prices,  the  President  sought  more 
efficaciously  to  distribute  coal  by  appointing  a  new  director  of  pri- 
ority of  -transportation  of  freight.1  The  new  director,  under  ap- 
proval of  the  President,  within  three  days  after  his  appointment,  di- 
rected that  rail  and  steamship  lines  give  bituminous  coal  shipments 
to  the  Northwest  preference  over  all  other  shipments.2  Now  that  a 

1  Judge  Robert  S.  Lovett,  appointed  Aug.  2  ,1917. 

2  A  full  account  and  copy  of  this  important  priority  order  may  be  found  in  the  Com- 
mercial and  Financial  Chronicle,  Aug.  25,  1917,  p.  766. 


166  HISTORY   OF   PRICES   DURING   THE    WAR. 

law  had  passed,  apparently  the  Government  meant  to  lose  no  time  be- 
fore controlling  the  distribution  and  prices  of  coal. 

An  inquiry  into  the  control  that  was  exercised  over  coal  prices 
leads  naturally  into  a  study  of  the  prices  fixed  for  bituminous  coal 
at  the  mine,  those  fixed  for  anthracite  coal  at  the  mine,  the  margins 
established  to  prevent  extortionate  profit  taking  by  middlemen,  the 
control  over  coal  at  retail,  and  the  peculiarly  refreshing  cost  data 
that  were  later  made  the  bases  for  coal  price  fixing. 

PKICE  FIXING   OF  BITUMINOUS   COAL  AT   THE  MINES. 

The  need  for  the  fixing  of  a  price  for  soft  or  bituminous  coal  in  the 
summer  of  1917  was,  perhaps,  more  pressing  than  for  fixing  one  for 
hard  or  anthracite  coal.  The  production  of  bituminous  coal,  at  any 
rate,  makes  up  in  bulk  well  above  three-quarters  of  our  annual  total 
500,000,000  tons  of  output  and  its  rises  in  price  were  far  more 
violent  than  those  of  hard  coal.  Of  the  total  bituminous  output, 
moreover,  about  80  per  cent  goes  to  the  railroad,  public  utility,  and 
manufacturing  industries  which  were  our  most  vital  secondary  war- 
making  weapons.  It  does  not  appear  that  the  President  entered 
again  into  protracted  conferences  with  the  industry,  such  as  the 
Peabody-Lane  conference  or  those  which  attended  the  later  price 
fixing  of  iron  and  steel,  while  formulating  the  basic  tentative  prices 
which  finally  he  announced  from  the  White  House  on  August  21, 1917. 

Prices  fxed  ~by  the  President. — The  President  upon  that  day  fixed 
a  schedule  of  prices  for  all  bituminous  coal  in  the  country,  f.  o.  b. 
mine  basis  for  tons  of  2,000  pounds,  "  subject  to  reconsideration  when 
the  whole  method  of  administering  the  fuel  supplies  of  the  country 
shall  have  been  satisfactorily  organized  and  put  into  operation." 
He  further  expressed  an  intention  soon  to  control  these  prices  not 
only  at  the  mines  but  at  wholesale  and  retail.  The  President,  in  the 
interest  of  fairness,  divided  the  country  into  29  coal  districts  and 
decreed  that  every  producer  in  each  district  should  market  his  coal 
at  the  particular  price  fixed  there  for  coal,  run  of  mine,  prepared 
sizes  and  slack  or  screenings.  These  newly  fixed  prices  ranged  in 
the  various  districts  from  $1.90  to  $3.25  for  run  of  mine,  $2.15  to 
$3.50  for  prepared  sizes,  and  $1.65  to  $3  for  slack  or  screenings.1 

1  Regarding  these  prices,  the  President's  statement  said : 

Figures  submitted  to  the  commission  *  *  *  show  that  most  of  the  present  prices 
now  charged  *  *  *  are  far  in  excess  of  cost  as  shown  by  the  operators'  bot>ks.  Many 
of  tho  operators  frankly  take  the  position  that,  they  are  trying  to  get  for  their  coal  the 
highest  prices  possible  under  the  present  demand  and  are  refraining,  even  at  prices  greatly 
increased  over  last  year,  from  contracting  their  output  to  the  extent  of  their  usual  cus- 
tom. They  defend  this  action  by  claiming  that  under  the  operations  of  the  law  of  supply 
and  demand  they  have  for  many  years  past  been  getting  little  more  for  their  coal  than 
the  bare  cost  of  production  ;  that  the  mining  of  bituminous  coal  during  that  period  has 
been  a  most  unprofitable  industry,  and  that  this  is  their  chance  to  recoup  themselves  for 
the  losses  of  several  years.  Accordingly,  they  are  demanding  prices  at  the  mine  to-day 
which  run  from  50  per  cent  to  several  hundred  per  cent  over  the  cost  of  their  output. 


GOVERNMENT   CONTROL   OVER   PRICES.  167 

These  prices  were,  so  the  President  said,  "  based  upon  the  actual  cost 
of  production  and  deemed  to  be  not  only  fair  but  liberal  as  well," 
and  "  under  them  the  industry  should  nowhere  lack  stimulation." * 

The  new  soft  coal  prices  ranged  from  20  to  35  per  cent  under  the 
maximum  prices  established  on  June  28,  previous  to  the  Peabody- 
Lane  agreement.  The  Peabody-Lane  prices  for  Pennsylvania  coal 
had  been  $3  for  mine  run  and  $3.50  for  domestic  lump,  egg,  and 
nut.  The  President's  prices  were  $2  for  mine  run  and  $2.25  for 
the  prepared  sizes.  The  Peabody-Lane  prices  for  West  Virginia 
coal  were  likewise  $3  for  mine  run  and  $3.50  for  domestic  lump, 
egg,  and  nut,  while  the  President's  prices  were  $2  and  $2.25,  respec- 
tively. The  Peabody-Lane  prices  for  Illinois  and  Indiana  coal  were 
$2.75  for  mine  run  and  steam  sizes,  and  $3.50  for  screened  domestic 
sizes.  The  President's  prices,  on  the  other  hand,  wrere  $1.95  for  mine 
run  and  $2.20  for  prepared  sizes.  The  new  prices  were,  indeed,  be- 
low the  price  tentatively  fixed  earlier  by  the  Navy  for  Virginia 
coal  at  $2.335.2  Mr.  C.  E.  Lesher,  delegated  from  the  Geological 
Survey  for  the  statistical  work  upon  coal  at  the  Fuel  Administra- 
tion, very  tersely  remarks  that  the  bituminous  prices  fixed  by  the 
President  on  August  21  were  as  far  below  the  Peabody-Lane  prices 
established  June  28,  as  they  in  turn  had  been  below  the  prevailing 
market.3 

Modifications  made  l)y  the  Fuel  Administrator. — The  President, 
in  his  announcement  of  bituminous  coal  prices  prior  to  his  appoint- 
ment of  a  Fuel  Administrator,  had  taken  especial  care  to  designate 
them  as  tentative  and  subject  to  change  by  any  fuel  agency  which 
might  be  created.  The  Fuel  Administrator  did,  in  point  of  fact, 
during  the  remainder  of  1917  and  particularly  in  1918,  make  con- 
siderable modifications  in  general,  and  in  particular  districts,  of  the 
original  prices.  The  Fuel  Administrator,  made  aware  of  serious 
demands  from  miners  for  wage  increases  in  West  Virginia,  Illinois, 
Indiana.  Ohio,  and  other  districts  early  in  the  fall,  wrote  the 
President 4  and  asked  that  bituminous  coal  prices  be  increased  by 
enough  to  allow  operators  to  satisfy  wage  demands.  The  President 
thereupon  issued  an  Executive  order,  on  October  27,  1917,  to  be 
effective  October  29,  1917,  allowing  producers  to  add  an  additional 

1  Letter  from  the  President,  announcing  the  new  coal  prices,  dated  Aug.  21,  1917. 

2  It  was  estimated  that  the  coal  producers,  under  the  new  price,  would  have  to  refund 
approximately  l.°,S  cents  per  ton  to  the  Government,  since  the  fixed  price  of  $2  per  short 
ton  was  calculated  as  equal  to  $2.20  per  long  ton.     The  Secretary  of  the  Navy,  when  in- 
formed of  the  new  Government  prices,  said  in  part :. 

"  The  Navy  will,  of  course,  get  back  any  excess  we  paid  in  the  $2.335  advance,  as  it  was 
agreed  that  this  was  merely  a  tentative  figure.  When  I  fixed  that  rate  I  took  the  highest 
price  suggested  by  any  one  whose  judgment  of  prices  at  the  mine  I  listened  to.  I  wanted 
to  be  sure  that  enough  was  paid,  and  resolved  all  doubt  in  favor  of  the  coal  dealers.  I 
hope  now  that  we  will  get  coal  at  a  reasonable  figure." 

3  "  Prices  of  Coal  and  Coke,"  by  C.  E.  Lesher,  W.  I.  B.  Price  Bulletin  No.  35. 

4  Oct.  26,  1917. 


168  HISTORY   OF  PRICES   DURING   THE   WAR. 

45  cents  for  the  bituminous  coal  at  the  mine  to  every  price  fixed  on 
August  21,  or  subsequently  modified.1  It  was  later  ruled  by  the 
Fuel  Administration 2  that  consumers  having  contracts  for  the  pur 
chase  of  coal,  made  before  August  21,  1917,  at  prices  below  the 
President's  prices,  need  not  add  45  cents  to  those  contract  prices, 
when  the  early  contracts  contained  no  provision  for  a  variation  in 
price  to  correspond  with  changes  in  the  wage  scale.  The  45-cent 
increase  for  bituminous  coal  was  made  generally  applicable  except 
for  Alabama,  a  nonunion  State.3  Alabama,  because  the  Fuel  Ad- 
ministration found  her  producers'  and  miners'  committees  in  agree- 
ment upon  a  scale  of  wages,  was  excepted  from  the  terms  of  the 
Washington  wage  agreement  of  October  C  and  the  Executive  order 
of  October  27,  1917.4 

The  Fuel  Administrator,  on  the  other  hand,  issued  an  order  May 
24,  1918,  and  effective  the  following  day,  reducing  the  price  of  all 
bituminous  coal  by  10  cents  per  net  ton  of  2,000  pounds,  f.  o.  b.  mines 
in  various  districts.  The  reduction  pertained  to  all  bituminous 
schedules,  irrespective  whether  there  had  or  had  not  been  modifica- 
tions of  the  President's  prices,  and  was  made  in  no  way  to  affect  the 
45-cent  increase  that  had  been  previously  allowed.5  This  reduction 
was  made  because  of  the  estimated  general  leveling  and  lowering 
of  costs  of  production,  accomplished  by  the  elimination  of  all  prefer- 

1  There  follows  in  full  a  copy  of  this  important  order,  increasing  the  fixed  price  for 
bituminous  coal  by  45  cents  subject  to  two  exceptions,  issued  Oct.  27,  1917  : 

The  scale  of  prices  prescribed  Aug.  21,  1917,  by  the  President  of  the  United  States  for 
bituminous  coal  at  the  mine,  as  adjusted  and  modified,  by  order  of  the  United  States  Fuel 
Administrator,  to  meet  exceptional  conditions  in  certain  localities,  is  hereby  amended  by 
adding  the  sum  of  45  cents  to  each  of  the  prices  so  prescribed  or  so  adjusted  and  modified, 
subject,  however,  to  the  following  express  exceptions : 

(1)  This  increase  in  prices  shall  not  apply  to  any  coal  sold  at  the  mine  under  an  exist- 
ing contract  containing  a  provision  for  an  increase  in  the  price  of  coal  thereunder  in  case 
of  an  increase  in  wages  paid  to  miners. 

(2)  This  increase  in  prices  shall  not  apply  in  any  district  in  which  the  operators  and 
miners  fail  to  agree  upon  a  penalty  provision,  satisfactory  to  the  Fuel  Administrator,  for 
the  automatic  collection  of  fines  in  the  spirit  of  the  agreement  entered  into  between  the 
operators  and  miners  at  Washington,  Oct.  6,  1917. 

This  order  shall  become  effective  at  7  a.  m.  on  Oct.  29,  1917. 
-Jan.  25,  1918. 

3  Alabama  was  excepted  by  order  from  the  Fuel  Administrator  dated  Oct.  31,  1917. 

4  Alabama  producers  and  miners,"  who  had  been  allowed  to  make  a  separate  and  satis- 
factory agreement  effective  Feb.  6,  1918,  came  to  a  new  agreement  on  Apr.  20,  and  they 
too  were  given  the  45-cent  increase  (as  of  the  order  of  Oct.  27,  1917)   effective  May  15, 
1918. 

E  The  effect  of  the  order  making  a  reduction  of  10  cents  per  net  ton  from  the  mine 
price  on  all  bituminous  coal  shipped  after  7  a.  m.,  May  25,  1918,  is  that  no  one  shall 
ask,  demand,  or  receive  more  than  the  applicable  Government  mine  price  thus  reduced 
for  any  coal  shipped  after  7  a.  m.,  May  25,  1918,  unless  the  same  was  shipped  pursuant 
to  a  bona  fide  contract  enforcible  at  law  entered  into  prior  to  Aug.  21,  1917.  Contracts 
made  between  Aug.  21,  1917,  and  Dec.  29,  1917,  do  not  authorize  any  exception  to  the 
above.  Contracts  made  after  Dec.  29,  1917,  must,  under  the  provisions  of  the  order 
dated  Dec.  24,  1917,  contained  in  Fuel  Administration  Publication  No.  16,  provide  that 
all  shipments  thereunder  shall  be  at  the  applicable  Government  mine  price  at  date  of 
shipment. 


GOVERNMENT   CONTROL   OVER   PRICES.  169 

ments  in  car  supply,  brought  about  by  the  President  acting  through 
the  United  States  Railroad  Administration. 

In  addition  to  the  above  general  increase  of  45  cents  above  the 
President's  prices,  and  later  decrease  of  10  cents  per  ton,  applicable 
virtually  to  the  whole  lot  of  bituminous  coal  in  the  country,  the 
Fuel  Administrator  made  numerous  lesser  modifications  of  the  Presi- 
dent's prices  within  various  particular  districts.  The  general  intent 
of  these  many  district  changes  was  to  adjust  more  precisely  the 
selling  prices  to  the  varying  costs  of  each  district  by  comparison 
with  other  districts,  and  of  various  sections  within  the  same  district. 
The  President,  for  example,  had  fixed  a  flat  price  of  $2,  run  of  mine, 
for  all  coal  in  Pennsylvania.  Mr.  Garfield,  at  different  times,  divided 
Pennsylvania  into  sections  on  the  basis  of  similarity  in  production 
costs,  and  not  only  assigned  each  section  of  the  district  a  separate 
fixed  price  in  accordance  with  its  costs  of  production,  but  increased 
those  prices  somewhat  above  the  President's  prices.  The  modified 
prices,  without  here  designating  the  districts,  ran  $2.25,  $2.75,  $2.60, 
$2.60,  $2,  $2.50,  $1.90,  and  $2.95,  respectively.  The  Ohio  prices 
which  the  President  had  fixed  at  $2,  run  of  mine  (thick  vein),  and 
$2.35  (thin  vein),  in  like  manner  were  modified  to  meet  the  costs 
instead  of  24  different  cost  districts,  and  the  prices  of  $3.75,  $3.25, 
$2,  $2.35,  $3,  $2.10,  $2.50,  $2.50,  $2.25,  $2.50,  $3,  $1.90,  $2.50,  $2.30, 
$2.95,  $2.05,  $2.45,  $2.45,  $2.20,  $2.45,  $2.95,  $1.90,  $2.05,  and  $2.50 
established.1  Perhaps  the  most  important  of  the  revisions  made  of 
the  original  prices  were  those  for  eastern  Kentucky;  Kanawha, 
W.  Va. ;  Georges  Creek,  Md. ;  central  Pennsylvania;  and  Hocking, 
Ohio.  These  typical  illustrations  and  others  which  may  be  made 
for  any  particular  coal  district,  show  that  the  Fuel  Administration 
did  allot  much  more  carefully  than  had  the  President,  prices  with 
respect  to  locality  costs,  and  that  it  generally  increased  the  Presi- 
dent's prices. 

A  comparison  of  prewar  and  -fixed  prices. — It  can  not  be  said  how 
much  the  fixing  of  bituminous-coal  prices  by  the  President  and  their 
subsequent  control  and  modification  by  the  Fuel  Administration  held 
prices  down.  It  would  be  inaccurate,  indeed,  to  compare  the  fixed 
prices  with  the  previously  tabulated  market  quotations  for  pre- 
regulation  months,  since  the  bulk  of  bituminous  coal  has  always  sold 
by  contract  and  at  much  below  the  "  spot "  market.  But  in  order 
that  there  might  be  afforded  some  rough  measure  of  the  actual  realiza- 
tion prices,  Mr.  C.  E.  Lesher  has  prepared  a  unique  scheme  for  the 
reduction  of  the  preceding  weighted  market  prices  to  theoretical 

JFor  a  more  detailed  designation  of  the  various  new  coal  districts  established  by 
the  Fuel  Administration,  and  a  comparison  of  the  many  modifications  made  of  the 
President's  prices,  one  should  refer  to  the  rules  and  regulations  of  the  Fuel  Administra- 
tion appended  to  this  inquiry. 


170 


HISTORY   OF   PRICES   DURING   THE   WAR. 


realization  prices.1  These  prices,  which,  perhaps,  represent  more 
accurately  the  true  status  of  the  weighted  average  bituminous  coal 
market  for  the  United  States  than  any  data  that  have  been  found, 
afford  the  best  known  basis  for  u  comparison  of  bituminous  prices 
before  and  after  control.  They  give  a  fair  measure  of  the  actual 
movement  of  coal  prices  up  to  September,  1917,  when  price  fixing 
had  begun,  and.  therefore,  a  measure  by  which  to  compare  the  subse- 
quent fixed  prices. 

WEIGHTED  REALIZATION  TRICES   OF   ALT,  BITUMINOUS   COAL    IN  THE   UNITED 

STATES. 


ACTUAL   TRICES  PER  NET   TON. 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

?1  22 

$1.17 

SI.  16 

SI.  19 

SI.  48 

$2.19 

February                            .... 

.18 

1.16 

1.16 

.17 

1.48 

2.20 

March  

.17 

.16 

.15 

.15 

1.45 

2.21 

\pril 

.17 

.17 

.12 

.20 

2.30 

2.71 

May 

17 

.17 

1.12 

.20 

2.44 

2.75 

June                                  

.17 

.16 

1.11 

.20 

2.43 

2.66 

July 

17 

.16 

1.11 

.20 

2.30 

2.68 

\ugust                              

.18 

.17 

1.11 

.20 

2.31 

2.67 

September 

.18 

.16 

1.12 

.23 

2.12 

2.67 

October       .      

.19 

1.16 

1.12 

.29 

2.12 

2.67 

November 

19 

1.18 

1.13 

.45 

2.19 

2.67 

December  .            

1.18 

1.16 

1.16 

1.46 

2.19 

2.67 

Year... 

1.18 

1.10 

1.13 

1.24 

2.07 

2.56 

RELATIVE   PRICES. 


104 

'100 

99 

101 

125 

187 

February                                            ... 

101 

99 

99 

100 

126 

188 

March 

100 

99 

98 

98 

124 

188 

\pril                                   

100 

100 

95 

102 

196 

231 

May     . 

100 

100 

95 

102 

208 

234 

June                             •          

100 

99 

95 

102 

210 

227 

July 

100 

99 

95 

102 

196 

227 

August                                   

101 

100 

95 

102 

196 

228 

September 

101 

99 

95 

105 

181 

228 

October                       

101 

99 

95 

110 

181 

228 

November 

101 

99 

96 

124 

187 

228 

December                    

101 

99 

99 

124 

187 

228 

Year  

101 

99 

96 

106 

175 

218 

1  The  method  by  which  Mr.  C.  E.  Lesher,  of  the  United  States  Fuel  Administration, 
reduced  the  spot  prices,  which  are  quoted  previously  in  this  chapter,  to  theoretical 
average  realization  prices  was  as  follows : 

An  average  realization  per  ton  for  each  calendar  year  was  obtained  from  the  coal 
reports  of  the  Geological  Survey,  by  dividing  the  total  dollars  received  f.  o.  b.  mines 
by  the  total  tons  of  each  coal  produced.  This  figure  was  an  average  for  12  months 
and  if  charted  would  be  represented  by  a  straight  line,  showing  none  of  the  monthly 
fluctuations  which  really  took  place.  .  These  annual  averages,  moreover,  were  for 
calendar  years,  whereas  the  annual  break  in  average  realization  more  nearly  corresponds 
to  the  coal  year  beginning  with  Apr.  1.  These  annual  average  figures  of  realization,  there- 
fore, were  arbitrarily  moved  forward  3  months,  and  the  figures  for  the  calendar  year 
1914  considered  to  apply  to  the  12-month  period  beginning  Apr.  1,  1914,  and  ending 


GOVERNMENT    CONTROL   OVER   PRICES.  171 

The  comparison  is  facilitated  by  the  reduction  of  the  theoretical 
weighted  realization  prices  to  corresponding  relative  prices  by  adopt- 
ing the  average  realization  prices  for  the  prewar  year  (July  1.  1913, 
to  June  30,  1914)  as  a  base  equal  to  100. 

It  is  clear  from  this  statistical  picture  that  the  actual  reduction 
in  bituminous-coal  prices  for  the  bulk  of  production,  as  affected  by 
price  fixing,  was  much  less  than  might  be  supposed  on  looking  at 
any  compilation  of  market  quotations  for  spot  transactions.  Indeed, 
there  was  no  greater  reduction  than  32  cents  per  net  ton  from  May, 
well  before  regulation,  to  October,  1917,  after  control  had  begun. 
And  not  again  throughout  the  whole  period  of  fuel  control  does 
this  theoretical  realization  price  fall  as  low  as  the  October  price 
($2.12).  Instead,  it  begins  a  rise  which  reaches  a  record  peak  of 
$2.75  per  ton  in  May,  1918,  nearly  a  year  after  the  spot  prices  had 
reached  their  peak.  It  wrould  seem  clear  that  the  control  of  bitumi- 
nous coal  scaled  down  tremendously  the  enormous  and  unprece- 
dented rise  which  spot  coal  in  the  open  market  had  attained  during 
the  six  months  prior  to  price  fixing.  But  it  is  open  to  question 
whether  there  were  such  perceptible  scalings  in  the  sales  which  repre- 
sented the  bulk  of  bituminous  transactions.  The  record  height  of 
'these  actual  sales,  for  the  country  as  a  whole,  came  eight  months 
after  control  had  set  in.  Bituminous-coal  prices,  which  were  con- 
trolled in  part  to  stimulate  production,  judging  them  as  a  whole 
and  ignoring  exceptions  within  particular  districts,1  did  not  main- 
tain the  lower  level  to  which  they  were  scaled  by  price  fixing  in  the 
summer  of  1917.  They,  whether  measured  by  the  spot  prices  or  the 
realization  prices,  were  brought  down  through  price  fixing  to  $2.12 
per  ton  in  September,  1917,  but  rose  to  $2.75  by  May,  1918. 

Mar.  31,  1915.  Quite  without  regard  to  quantity  of  coal  produced  in  any  month,  the 
spot  prices  for  each  coal  year  were  reduced  or  raised  proportionately,  so  that  their 
nrithmetic  mean  would  equal  the  average  realization.  It  was  arbitrarily  assumed  that 
the  average  realization  was  represented  by  the  sale  price  of  coal  delivered  on  contract, 
that  the  modified  spot  prices  represented  the  price  on  current  sales,  and  that  three- 
quarters  of  the  coal  was  sold  on  contract  and  one-quarter  at  the  spot  market.  A  figure 
for  each  coal  for  each  month  was  thus  calculated,  i.  e.,  three-quarters  average  realization 
and  one-quarter  spot  prices  reduced  to  average  realization.  For  the  period  from 
September,  1917,  to  December,  1918,  the  prices  fixed  by  the  Government  were  considered 
spot  prices  and  from  April  to  December,  1918,  the  same  prices  were  taken  for  the 
spot  reduced  to  average  realization,  since  the  actual  realization  for  1918  was  not  yet 
available.  It  is  believed  that  these  figures  record  more  accurately  the  true  price  status 
of  the  coal  market  than  do  the  spot  prices.  They  are,  at  any  rate,  based  upon  the 
actual  annual  average  return  per  ton  of  coal. 

1 A  study  of  the  stabilizing  effects  of  coal  regulation  may  be  made  within  each 
bituminous  district  by  use  of  materials  already  segregated  in  "  Prices  of  Coal  and  Coke," 
by  C.  E.  Lesher. 


172  HISTORY   OF   PRICES   DURING   THE   WAR. 

PRICE  FIXING  OF  ANTHRACITE  COAL  AT  THE  MINE. 

It  is  to  be  remembered  that  hard  or  anthracite  coal,  which  is  used 
in  the  main  by  householders,  constitutes  only  15  per  cent  of  our  total 
coal  production,  and  was  not  regulated  by  the  earlier  Peabody-Lane 
agreements  or  by  the  coal-production  committee.  The  Federal  Trade 
Commission,  on  the  other  hand,  undertook  during  the  spring  of 
1917  arnj  until  the  President  fixed  anthracite  prices,  to  control  the 
prices  of  anthracite  coal  by  various  voluntary  agreements  which 
were  entered  into  with  the  anthracite  producers.1  Anthracite  prices, 
as  a  whole,  were  thus  well  under  control  by  the  summer  of  1917,  at 
the  direction  of  Congress.  These  full  data  were  presented  to  the 
President  on  August  22,  and  on  August  23,  1917,  he  fixed  the  prices 
of  anthracite  coal  for  the  country. 

1  There  follows  a  chronological  review  in  brief,  authorized  by  the  Federal  Trade  Com- 
mission, of  each  important  agreement  looking  to  a  regulation  of  anthracite  coal  prices, 
between  the  Federal  Trade  Commission  and  the  anthracite  producers  up  to  the  time  of 
the  President's  prices  (Aug.  23,  1917)  : 

1.  See  letter  of  commission  dated  Mar.  12,  1917,  to  25  principal  anthracite  oplrators 
concerning  rumored  suspension  of  spring  discounts  (see  Exhibit  I,  p.  371,  S.  Doc.  No.  50, 
65th  Cong.,  Isfsess.).     With  this  letter  the  commission  inaugurated  a  policy  of  endeavor- 
ing to  limit  the  price  of  anthracite  to  domestic  consumers. 

2.  The  May  price  on  anthracite  egg,  stove,  and  chestnut  sizes  virtually  was  fixed  for 
coal  produced  by  railroad  coal  companies  through  publication  of  the  commission's  interim 
report  to  the  Senate  (see  Schedule  Exhibit  II,  p.  373,  S.  Doc.  No.  50).     This  report  fol- 
lowed conferences  with  the  so-called  railroad  coal  company  operators  early  in  May.     To 
May  prices  add  10  cents  per  ton  of  2,240  pounds  each  succeeding  month,  up  to  and  includ- 
ing August,  1917,  to  ascertain  approximate  f.  o.  b.  mine  prices  on  the  sizes  mentioned, 
charged  by  the  railroad  coal  companies.     By  adding  another  10  cents,  the  price  fixed  by 
the  President  on  these  sizes,  effective  Sept.  1,  1917,  is  obtained.     Broken,  pea,  and  buck- 
wheat sizes  were  not  the  subject  of  agreement,  since  they  have  a  large  industrial  use,  and 
the  commission  was  concerned  principally  with  the  prices  of  sizes  most  in  use  by  domestic 
consumers. 

3.  Later  in  May   (about  the  llth)  a  conference  was  held  with  individual  operators  to 
discuss  their  prices,  since  the  individual  output  continued  to  go  out  at  high  prices  (reach- 
ing as  high  as  $8  and  $8.50  per  ton  of  2,240  pounds  f.  o.  b.  mines  in  some  instances). 
This  conference  is  discussed  in  Commissioner  Colver's  testimony,  par.  1,  p.  264,  Pt.  I  of 
the  hearing  before  the  Committee  on  Interstate  Commerce.     Jobbers'  and  retailers'  rep- 
resentatives also  were  present  at  this  conference.     No  fixed  price  was  agreed  on  with  indi- 
vidual operators  at  this  conference,  but  high  prices  realized  by  individual  operators  were 
severely  criticized  by  the  commission. 

4.  The  commission's  letter  of  May  14,  1917,  Exhibit  IV,  pp.  374,  375,  Senate  Document 
No.  50,  and  the  form  of  weekly  report  printed  on  p.  376,  that  was  required  of  individual 
operators  for  the  last  part  of  May,  1917,  was  the  first  intimation  given  them  concerning 
what  the  commission  considered  the  maximum  permissible  f.  o.  b.  mine  prices  for  their 
output  of  egg,  stove,  chestnut,  and  pea  sizes,  when  sold  for  domestic  consumption.     This 
price  (May)  was  35  cents  per  gross  ton  above  the  railroad  coal  company  prices  already 
referred  to  on  egg,  stove,  and  chestnut  (no  price  for  pea  was  agreed  on  with  the  railroad 
coal  companies). 

Subsequently  it  was  found  that  it  would  be  difficult  or  impossible  to  hold  all  individual 
operators  to  these  prices,  and  the  June  reports  for  individual  operators  (printed  on  p. 
877,  S.  Doc.  No.  50)  provided  for  a  maximum  differential  of  75  cents  per  gross  ton  over 
the  railroad  coal  company  prices.  Ten  cents  per  ton  of  2,240  pounds  was  added  for 
each  month  up  to  and  including  August,  1917.  In  this  connection  it  should  be  noted 
that  all  individual  operators  did  not  avail  themselves  of  the  full  differential.  For  in- 
stance, the  Kingston  Coal  Co.,  the  largest  individual  operator,  with  a  total  yearly  ton- 
nage (all  sizes)  of  1,200,000  tons,  at  no  time  took  more  than  35  cents.  It  was  agreed 
with  representatives  of  the  individual  operators  that  this  differential  should  not  at  that 
time  be  made  applicable  to  egg  and  pea  coal  sold  for  industrial  use,  provided  that  the 


GOVERNMENT   CONTROL   OVER   PRICES.  173 

Prices  fixed  ~by  the  President ',  August  23  ^  1917. — The  President's 
maximum  prices  for  anthracite  coal,  announced  like  those  for  bi- 
tuminous coal  before  he  had  appointed  his  Fuel  Administrator,  *•  were 
to  be  effective  September  1.  They  were  virtually  the  same  as  the 
prices  then  charged  at  the  mines  under  the  voluntary  agreement  made 
by  the  producers  with  the  Federal  Trade  Commission,  if  indeed  not 
slightly  higher.2  The  one  exception  to  this  rule  was  pea  coal,  which 
was  increased  above  the  market  upon  recommendation  of  the  Federal 
Trade  Commission,  but  which  was  subsequently  reduced  by  60  cents 

normal  percentage  of  the  total  output  of  each  operator  sold  for  these  purposes  were 
not  exceeded,  and  that  no  attempt  should  then  be  made  to  limit  the  price  on  broken  and 
buckwheat  sizes,  generally  used  in  the  industries. 

For  the  purposes  of  observing  the  proportion  of  controlled  and  uncontrolled  sizes 
produced  by  individual  operators,  monthly  reports  were  required  ;  and  these  were  checked 
with  the  percentages  of  the  different  sizes  that  were  normally  produced  (see  Forms  3  and 
3A,  reproduced  on  p.  879,  S.  Doc.  No.  50). 

It  should  be  remarked  that  some  independent  operators  voluntarily  abrogated  contracts 
made  at  higher  prices  than  those  suggested  as  the  limitation  maximum,  and  shipped  the 
coal  so  contracted  for  at  the  lower  prices  suggested  as  permissible  maxima  by  the  com- 
mission. 

The  commission's  views  respecting  limitation  maximum  f.  o.  b.  mine  prices  were  rein- 
forced by  agents  in  the  anthracite  fields-  who  frequently  called  upon  operators  for  inspec- 
tion of  their  sales  records,  consultations,  etc. 

5.  Several   jobbers  attended   the   conference   of   May    11    by    invitation,   and   while   no 
agreement  was  then  made  respecting  a  limitation  jobbers'  margin  on  anthracite  coal,  the 
commission's   views    respecting   exorbitant   margins,    and   on   mterbuying  among   jobbers 
with  the  consequent  multiplication  of  jobbers'  margins,  were  made  known  to  them. 

About  the  middle  of  May  or  shortly  afterwards,  the  commission  began  to  express  in- 
formally to  leading  jobbers  its  view  that  20  cents  per  ton  of  2,240  pounds  should  be  the 
maximum  jobbers'  margin  on  anthracite  shipped  to  Buffalo,  or  points  east  of  Buffalo, 
that  25  or  30  cents  should  be  the  maximum  on  shipments  west  of  Buffalo,  and  that  the 
combined  margins,  of  any  number  of  jobbers  handling  a  given  shipment,  should  not  exceed 
these  maxima. 

A  system  of  weekly  reports  from  jobbers  also  was  inaugurated  in  May.  (See  letter 
of  commission  to  jobbers  and  report  required,  reproduced  as  Exhibit  VIII,  pp.  382,  383, 
384,  S.  Doc.  No.  50.) 

The  commission's  views  respecting  limitation  jobbers'  margins  on  anthracite  were  com- 
municated to  all  anthracite  jobbers  in.  its.  letter  of  June  9.  (See  Exhibit  IX,  p.  385,  S. 
Doc.  No.  50.) 

Field  agents  of  the  commission  reinforced  the  commission's  views  as  to  jobbers'  margins 
by  frequent  inspection  of  jobbers'  records,  interviews,  etc. 

6.  At  the  conference  of  May  11  several  representatives  of  retailers'  associations  were 
present  by  invitation.     They  were  given  an  opportunity  to  hear  the  commission's  views 
on    excessive    prices,    but    no    agreement    was    attempted    respecting    retailers'    margins. 

Subsequently  the  commission  sent  to  retailers  in  many  different  cities  letters  and  forms 
similar  to  those  shown  in  Exhibit  X,  pp.  385,  386,  387,  388  of  Senate  Document  No.  50. 
From  these  forms  comparative  statements  of  tonnage  received  in  given  cities  or  towns 
during  stated  periods  were  compiled,  the  gross  margins  of  retailers  in  those  towns  or 
cities  were  computed,  and  the  results  given  publication  through  the  local  press.  The  com- 
mission counted  on  such  publicity  to  restrain  retail  dealers'  margins  to  a  certain  extent, 
?.nd  while  no  names  were  published,  except  in  Washington  and  Indianapolis,  these 
press  statements  no  doubt  had  some  effect  in  restricting  retail  margins  and  prices  during 
the  summer  and  fall  of  1917. 

7.  The  commission's  activities  in  the  matter  of  anthracite  pea  control  were  placed  fully 
before  the  President  on  Aug.  22,  before  the  anthracite  prices  effective  Sept.  1,  1917,  were 
fixed  by  him. 

1  Mr.  Harry  A.  Garfield,  president  of  Williams  College  and  chairman  of  the  wheat  price- 
fixing  committee  of  the  Food  Administration,  was  appointed  the  same  day  (Aug.  23,  1917). 

2  Mr.  David  L.  Wing  of  the  Federal  Trade  Commission,   in   his  testimony  at  the  coal 
hearings  referred  to  previously,  declared  that  the  President's  prices  were  found  by  adding 
10  cents.     (See  Exhibit  No.  272,  p.  914  of  printed  hearings,  pursuant  to  S.  Res.  163,  Coth 
Cong.  2d  sess.) 


174  HISTORY   OF   PRICES   DURING   THE   WAR. 

per  gross  ton  by  the  Fuel  Administration  on  October  1,  1917.  The 
new  anthracite  prices,  fixed  for  broken,  egg,  stove,  chestnut,  and 
pea  coal  under  each  of  the  three  grades,  white  ash,  red  ash,  and 
Lykens  Valley,  varied  from  $1  to  $1.50  per  ton  of  2,240  pounds  f.  o. 
b.  cars  at  the  mine.  The  President,  curiously,  made  the  new  prices 
explicable  specifically  to  16  leading  Pennsylvania  anthracite  pro- 
ducers whom  he  named  in  the  price-fixing  announcement.  It  was 
then  provided  that  anthracite  producers,  other  than  the  16  named, 
should  not  sell  anthracite  coal  at  prices  to  exceed  by  more  than  75 
cents  per  ton  the  schedule  established  for  the  larger  producers.1  The 
anthracite  schedule  of  fixed  prices  showed  important  and  interesting 
variations  in  practice  from  the  earlier  bituminuous  schedule. 

Modifications  made  "by  the  Fuel  Administrator. — The  Fuel  Admin- 
istrator made  more  modifications  of  a  general  character  in  the  Presi- 
dent's anthracite  prices  than  in  his  bituminous  prices.  The  whole 
schedule  of  anthracite  prices,  as  fixed  by  the  President  August  23, 
was  increased  by  Executive  order  to  be  effective  December  1,  1917, 
to  allow  an  addition  of  35  cents  per  gross  ton  for  each  fixed  price. 
That  modification  was  made  to  provide  for  wage  increases  author- 
ized by  the  President.  The  usual  summer  reductions  in  the  prices  of 

1  Thero  follows  so  much  of  the  President's  order  of  Aug.  23,  1917,  as  pertains  to  the 
fixing  of  anthracite  coal  prices  at  the  mine  : 

4.  Effectiv6  Sept.  1,  1917,  the  maximum  prices  per  ton  of  2,240  pounds  free  on  board* 
cars  at  the  mines  for  the  grades  and  sizes  of  anthracite  coal  hereinafter  specified  shall  not 
exceed  the  prices  indicated  in  par.  5  when  such  coal  is  produced  and  sold  by  the  Phila- 
delphia &  Reading  Coal  &  Iron  Co.,  Lehigh  Coal  &  Navigation  Co.,  Lehigh  &  Wilkes- 
Barre  Coal  Co.,  Hudson  Coal  Co.,  Delaware  &  Hudson  Co.,  Scranton  Coal  Co.,  Lehigh  Val- 
ley Coal  Co.,  Coxe  Bros.  &  Co.,  Pennsylvania  Coal  Co.,  Hillside  Coal  &  Iron  Co.,  Delaware, 
Lackawanna  &  Western  Railroad  Co.,  Delaware,  Lackawanna  &  Western  Coal  Co.,  Susque- 
hanna  Coal  Co.,  Susquehanna  Collieries  Co.,  Lytle  Coal  Co.,  or  the  M.  A.  Hanna  Coal  Co. 

5.  The  grades  and  sizes  for  which  the  maximum  prices  are  specified  are  as  follows  : 
White  ash  anthracite  coal  of  the  grade  that  between  Jan.  1,  1915,  and  Jan.  1,  1917,  was 
uniformly  sold  and  recognized  in  the  coal  trade  as  coal  of  white-ash  grade;  red-ash 
anthracite  coal  of  the  grade  that  between  Jan.  1,  1915,  and  Jan.  1,  1917,  was  uniformly 
sold  and  recognized  in  the  trade  as  coal  of  red-ash  grade  ;  and  Lykens  Valley  anthracite 
coal  that  is  mined  exclusively  from  the  Lykens  Valley  seams  and  of  the  grade  that  between 
Jan.  1,  1915,  and  Jan.  1,  1917,  was  uniformly  sold  and  recognized  in  the  coal  trade  as 
coal  of  Lykens  Valley  grade. 


White-ash  grade : 

Broken $4.  ,55 

Egg 4.45 

Stove 4.70 

Chestnut 4.80 

Pea—  4. 00 


Red-ash  grade : 

Broken $4.  75 

Egg 4.65 

Stove 4.90 

Chestnut 4.  90 

Pea__  4.  10 


Lykens  Valley  grade  : 

Broken $5.  00 

Egg 4.90 

Stove 5.30 

Chestnut 5.  30 

Pea—  4.  35 


6.  Producers  of  anthracite  coal  who  are  not  specified  in  par.  4  shall  not  sell  the  various 
grades  and  sizes  of  anthracite  coal  at  prices  that  exceed  by  more  than  75  cents  per  ton 
of  2,240  pounds  free  on  board  cars  at  the  mines  the  prices  enumerated  in  par.  5 ;  provided 
that  any  producer  of  anthracite  coal  who  incurs  the  expense  of  rescreening  it  at  Atlantic 
or  Lake  ports  for  transshipment  by  water  may  increase  the  price  thereof  by  not  more 
than  5  cents  per  ton  of  2,240  pounds. 

7.  Producers  of  anthracite  coal  specified  in  par.  4  of  these  regulations  shall  not  sell 
anthracite  coal  to  producers  of  anthracite  coal  not  specified  in  par.  4. 

8.  Dealers  and  selling  agents  shall  not  sell  coal  produced  by  the  producers  included  in 
par.  4  on  the  basis  of  the  prices  fixed  at  the  mine  for  coal  produced  by  producers  not 
specified  in  said  paragraph. 


GOVERNMENT   CONTROL   OVER   PRICES.  175 

domestic  sizes  were  offered  to  the  trade  by  the  producers  in  1918, 
although  not  required  by  the  Fuel  Administrator.  Still  a  further 
and  much  greater  increase,  $1.05  per  gross  ton,  was  allowed  to  the 
prevailing  maximum  prices  for  Pennsylvania  anthracite  coal  by  the 
Fuel  Administrator  after  November  1, 1918.  This  modification,  too, 
was  made  to  provide  for  increased  costs  of  production  and  for  wage 
increases.1  Two  weeks  later  (November  15)  a  maximum  price  for 
steam  sizes  of  anthracite  coal  was  fixed  for  the  first  time  by  the 
President.2 

A  comparison  of  prewar  and  -fixed  prices. — The  stabilizing  effects 
of  coal  regulation  upon  the  prices  of  anthracite  can  be  more  easily 
measured  than  those  of  bituminous  coal.  There  are,  however,  certain 
very  marked  seasonal  fluctuations  in  the  prices  of  anthracite  which 
must  be  held  firmly  in  mind  while  attempting  any  measure.  The 
anthracite  producers,  in  order  to  make  for  uniform  operations  at  the 
mines  during  the  slack  part  of  each  year,  have  for  years  offered  a 
reduction  of  50  cents  a  gross  ton  each  April  for  all  purchases  of 
domestic  sizes,  followed  by  a  reduction  of  40  cents  in  May  and  a 
30  cents  reduction  in  June,  20  cents  in  July,  and  so  on  until  Septem- 
ber, when  the  normal  price  would  be  again  reached.  These  summer 
reductions  have  become  so  much  a  factor  in  the  general  level  of  an- 
thracite coal  prices  that  they  constitute  the  primary  fluctuation  dur- 
ing the  year.  Prices  of  anthracite  coal  ordinarily  remain  fairly  level 
until  April,  fall  several  per  cent,  and  come  gradually  back  to  normal, 
reaching  their  level  again  in  September.  But  these  important  sea- 
sonal fluctuations  of  anthraciate  coal  are  concealed  by  the  much 
larger  and  more  irregular  fluctuations  since  the.  latter  part  of  1916. 

The  only  available  method  by  which  to  judge  the  stabilizing  effects 
of  price  fixing  upon  the  prices  of  anthracite  coal,  as  was  the  case 
with  bituminous  coal,  is  to  compare  the  prices  before  and  after  con- 
trol. It  can  not,  of  course,  be  concluded  hastily  from  that  compari- 
sion  whether  coal  regulation  was  or  was  not  effective,  since  there 
was  presented  to  it  the  problem  not  only  of  stabilizing  prices,  but 
of  stimulating  production.  The  theoretical  realization  prices  for 
nil  anthracite  coal  in  the  United  States,  in  contrast  to  those  prices 

1  The  engineers  committee  of  the  Fuel  Administration,  through  Mr.  R.  V.  Norris,  makes 
tiio  following  summary  and  observations  relative  to  labor  increases  which  entered  into 
the  prices  of  anthracite  coal : 

Effective  Dec.  1,  1917,  a  labor  war  bonus,  ranging  from  60  cents  to  $1.10  per  day  for 
labor  and  25  per  cent  for  contract  miners  was  granted  over  and  above  the  wage  scales 
effective  by  agreement  Apr.  1,  1916,  expiring  Apr.  1,  1920,  and  the  prices  fixed  Aug.  23, 
1917,  and  modified  Oct.  1,  1917,  by  reducing  pea  coal  60  cents  per  ton,  were  increased  by 
35  cents  per  ton  to  compensate  for  this  labor  increase.  The  actual  reported  increase  in 
labor  cost  due  to  this  advance  was  figured  by  the  Federal  Trade  Commission  from  the 
operators'  reports  to  be  60.3  cents.  From  the  actual  pay-roll  figures  later  obtained  by 
the  TJ.  S.  Fuel  Administration,  this  increase  was  found  to  be  76.3  cents  per  ton. 

2  The  maximum  price  thus  established  was  50  cents  a  ton  less  than  that  fixed  for  pea 
coal. 


176 


HISTORY   OF   PRICES   DURING   THE   WAR. 


for  bituminous  coal,  show  a  rise  very  similar  to  the  spot  prices. 
There  are  printed  here,  therefore,  only  the  relative  prices,  taking 
the  prewar  year  (July  1,  1913,  to  June  30,  1914)  as  a  base  equal 
to  100,  for  the  series  of  realization  prices.1  because  of  the  marked 
similarity  between  them  and  the  less  adequate  spot  prices. 

WEIGHTED    REALIZATION    PRICES    OF    ALL    ANTHRACITE    COAL    IN    THE    UNITED 

STATES. 


ACTUAL  TRICES  PER   GROSS   TON. 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January 

$2.  69 

$2.  66 

$2.58 

$2.60 

$3  08 

$3  63 

February  .  .                 .                        .... 

2.64 

2.65 

2.57 

2.59 

3.09 

3.60 

March 

2.63 

2.65 

2.56 

2.58 

2.97 

3  63 

April... 

2.50 

2.44 

2.44 

2.70 

3.08 

.31 

May... 

2.52 

2.47 

2.46 

2.66 

3.45 

31 

June  

2.56 

2.49 

2.48 

2.67 

3.36 

.34 

July.. 

2.57 

2.52 

2  49 

2.71 

3.37 

30 

August  

2.61 

2.55 

2.52 

2.75 

3.39 

.33 

September 

2.65 

2.58 

2.57 

2.79 

3.47 

54 

October  

2.65 

2.58 

2.58 

2.84 

3.47 

.54 

November.  ... 

2.65 

2.58 

2.58 

3  09 

3.50 

5.30 

December 

2  65 

2  58 

2  59 

2  99 

3  63 

5  30 

Year . 


2.60 


2.56 


2.  .54 


2.74 


3.32 


4.35 


RELATIVE   PRICES. 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January.  .  . 

104 

103 

99 

100 

119 

140 

February  .  . 

102 

102 

99 

100 

119 

139 

March... 

101 

102 

99 

99 

114 

140 

April 

99 

94 

94 

104 

119 

166 

May  

97 

95 

95 

103 

132 

166 

June 

99 

96 

96 

103 

129 

167 

July..     . 

99 

97 

% 

104 

130 

166 

August  

101 

98 

97 

106 

131 

167 

September,  

102 

99 

99 

108 

134 

175 

October 

102 

99 

99 

109 

134 

175 

November  

102 

99 

99 

119 

135 

204 

December 

102 

99 

100 

115 

140 

204 

Year                           ., 

101 

99 

97 

106 

128 

It  7 

The  weighted  average  realization  prices  for  all  anthracite  coal 
sold  in  the  United  States,  made  by  abstracting  some  5,000  quota- 
tions and  reducing  them  to  a  basis  at  which,  it  is  estimated,  the  bulk 
of  sales  were  made,  shows  an  exceedingly  steady  market  during  1913, 
1914,  and  1915.  Anthracite  coal  in  the  latter  part  of  1916,  however, 
began  a  rise  which  continued  steadily  in  the  main  until  the  end  of 
1918.  The  general  price  held  steady  for  a  brief  space  only  at  $3.47 
per  ton,  following  the  President's  first  announcement,  and  then  rose 
in  the  latter  part  of  1917  by  reason  of  the  increase  of  35  cents  per 
ton  that  was  allowed,  effective  December  1.  The  price  rose  from  $3.63 
per  ton  in  December,  1917,  and  January,  1918,  steadily,  except  for 
slight  reductions  during  the  summer,  to  the,  latter  part  of  1918,  when 

1  These  realization  prices  were  made  by  C.  E.  Lesher  in  like  manner  to  the  realization 
prices  previously  printed  for  bituminous  coal.  A  study  of  the  spot  or  market  prices  for 
anthracite  coal  may  le  made  from  Mr.  Lesher's  pamphlet. 


GOVERNMENT    CONTROL    OVER   PRICES.  177 

another  increase  of  $1.05  was  allowed.  The  price  realized  for  an- 
thracite coal  throughout  the  country  as  a  whole,  thus  advanced  rather 
steadily  under  Government  regulation,  from  the  time  control  set  in 
until  after  the  signing  of  the  armistice.  It  made  during  that  time 
a  gain  from  $3.47  per  ton  in  September,  1917,  to  $5.30  in  Novem- 
ber, 1918. 

CONTROL  OVER  THE  PRICES   OF  COAT,  MIDDLEMEN. 

Jobbers'  margins. — It  must  have  been  obvious  to  the  President  at 
the  outset  that,  while  the  fixing  of  fair  prices  for  coal  at  the  mine 
would  stimulate  production,  it  would  not  insure  against  extortionate 
profits  to  middlemen.  He,  in  his  first  announcement  of  bituminous 
prices,  gave  promise  soon  of  a  fair  and  equitable  control  of  prices 
for  sales  by  middlemen  and  retailers.  The  President's  order  of 
August  23,  fixing  prices  of  bituminous  coal  at  the  mine,  left  middle- 
men and  retailers  a  free  hand  to  charge  consumers  what  they  would. 
But  on  August  23,  1917,  in  the  same -order  by  which  he  also  fixed 
anthracite  coal  prices,  the  President  set  certain  jobber  margins. 
Bituminous  coal  jobbers,  by  that  order,  were  not  allowed  to  add  to 
their  purchase  price  a  gross  margin  above  the  fixed  price  in  excess 
of  15  cents  per  ton  of  2,000  pounds,  nor  were  the  combined  gross 
margins  of  a  number  of  jobbers  allowed  to  exceed  that  amount.  An- 
thracite coal  jobbers  were  not  allowed  a  gross  margin  above  the  fixed 
price  in  excess  of  20  cents  per  ton  of  2,240  pounds  when  delivery 
was  at  or  east  of  Buffalo,  or  in  excess  of  30  cents  for  deliv^y  west 
of  Buffalo.1  The  modifications  of  these  original  margins  made  by 
the  Fuel  Administration  were  of  less  importance  than  its  changes  in 
prices  fixed  by  the  President.2 

1  The  sections  of  the  President's  order  of  Aug.   23,   1917,   which   relate  to  bituminous 
and  anthracite  jobber  margins  follow  : 

1.  A  coal  jobber  is  defined  as  a  person    (or  other  agency)    who  purchases  and  resells 
coal  to  coal  dealers  or  to  consumers  without  physically  handling  it  on,  over,  or  through 
his  own  vehicle,  dock,  trestle,  or  yard. 

2.  For  the  buying  and  selling  of  bituminous  coal  a  jobber  shall  not  add  to  his  pur- 
chase price  a  gross  margin  in  excess  of  15  cents  per  ton  of  2,000  pounds,  nor  shall  the 
combined  gross  margins  of  any  number  of  jobbers  who  buy  and  sell  a  given  shipment 
or  shipments  of  bituminous  coal  exceed  15  cents  per  ton  of  2,000  pounds. 

3.  For  buying  and  selling  anthracite  coal  a  jobber  shall  not  add  to  his  purchase  price 
a  gross  margin  in  excess  of  20  cents  per  ton  of  2,240  pounds  when  delivery  of  such  coal 
is  to  be  effected  at  or  east  of  Buffalo.    For  buying  or  selling  anthracite  coal  for  delivery 
west  of  Buffalo  a  jobber  shall   not  add  to  his  purchase  price  a  gross  margin  in  excess 
of  30  cents  per  ton  of  2,240  pounds.     The  combined   gross  margins  of  any  number  of 
jobbers  who  buy  and  sell  a  given  shipment  or  shipments  of  anthracite  coal  for  delivery 
at  or  east  of  Buffalo  shall   not   exceed  20   cents  per   ton  of   2,240   pounds,   nor   shall 
combined  margins  exceed  30  cents  per  ton  of  2,240  pounds  for  the  delivery  of  anthra- 
cite coal  west  of  Buffalo.     Provided  that  a  jobber's  gross  margin  realized  on  a  given 
shipment  or  shipments  of  anthracite  coal  may  be  increased  by  not  more  than  5  cents 
per   ton    of   2,240   pounds    when    the    jobber   incurs    the    expense    of    rescreening    it   at 
Atlantic  or  Lake  ports  for  transshipment  by  water. 

.t  *For  a  full  compilation  of  all  subsequent  orders  relating  to  jobbers'  margins,  one 
should  consult  "  General  Orders,  Regulations,  and  Rulings  "  of  the  Fuel  Administration, 
Chapter  III,  Title  IX ;  Chapter  II,  Title  IV;  Chapter  III,  Title  VII ;  and  notes  under  each, 

125547°— 20 12 


178  HISTORY   OF  PEICES   DURING  THE   WAR, 

Distributors*  nwrgntv. — It  became  necessary  in  the  spring  of  1918 
to  bring  certain  distributors  under  license  control  in  order  to  admin- 
ister regulation  more  effectively.  A  presidential  proclamation,1  ac- 
cordingly, was  issued  requiring  all  distributors  of  coal  or  coke  as 
jobber,  broker,  selling  agent,  or  "  in  any  capacity  whatever,"  to  se- 
cure a  license  on  or  before  April  1,  1918,2  from  the  Fuel  Administra- 
tor and  under  such  conditions  as  might  be  prescribed  by  him. 

Mr.  Garfield  then  issued  an  order  with  the  approval  of  the  Presi- 
dent, prescribing  that  licensees  who  sell  coal  or  coke  without  phy- 
sically handling  it  should  not  ask  more  than  the  prevailing  fixed 
price  plus  5  cents  per  ton  of  -2,^40;  and  licensees  who  act  as  purchas- 
ing agents  without  becoming  the  owner  might  charge  a  purchasing 
commission  not  in  excess  of  15  cents  per  ton  of  2,000  pounds  of  bitu- 
minous coal,  or  20  cents  per  ton  of  2,240  pounds  of  anthracite  coal 
for  delivery  at  or  east  of  Buffalo  and  30  cents  for  delivery  west.3 

CONTROL  QVER  COAL  AT  RETAIL. 

One  of  the  most  difficult  tasks  of  the  war-time  control  over  fuel 
was  the  regulation  of  the  retail  prices  of  coal.  The  Fuel  .Adminis- 
trator, realizing  the  prime  necessity  of  assuring  stable  prices  to  the 
small  purchasers  and  consumers,  set  forth  a  scheme  for  the  control 
of  retail  coal  prices  as  early  as  October  1,  1917.  The  administration 
of  the  plan  involved,  of  course,  the  assistance  of  the  State  and  local 
committees,  of  whom  there  were  legion.4 

No  retail  dealer  under  the  plan  was  allowed  to  charge  consumers 
a  retail  gross  margin  of  coal  or  coke  in  excess  of  the  average  gross 
margin,  above  his  average  cost,  added  by  the  same  dealer  during 
1915,  plus  30  per  cent  of  the  1915  margin.5 

A  measure  of  the  movement  of  retail  prices,  before  and  after  regu- 
lation, is  given  in  the  table  below.  This  table  shows  average  and 
relative  retail  prices,  as  compiled  by  the  Bureau  of  Labor  Statistics, 
for  Pennsylvania  white-ash  coal,  both  stove  and  chestnut  sizes,  and 
bituminous  coal  for  the  United  States  on  January  15  of  each  year, 
1913  to  1919,  inclusive.  An  average  price  for  the  year  1913  has  been 
made  from  the  averages  for  January  and  July  of  that  year.  This 

1  This  proclamation,   issued  under  authority  of  the  food  and  fuel  act,  ^vas   made  Mar. 
15V  1918. 

2  An.   exception    was    made   to    those   specifically   exempted   by    the    food   and    fuel   act, 
producers  and  miners  of  coal   and   manufacturers  of  coke,  distributing  exclusively  their 
own  product,  and  retail  dealers,  as   denned   in  the  Fuel  Administrator's  order  of  Oct.   1, 
1917. 

3  A  full  listing  of  all   orders  relating   to  licensed   distributors   may   be  found  in   Fuel 
Administration  "General   Orders,  Regulations  and   Rulings,"  Chap  III.  Title  IX,  sec.  2. 

4  See  fuel  orders   referred   to  above,   Chap.   II,  Title  VI,   for   full   retail   price   regula- 
tions. 

5  Provided  that   the  retail  gross  maigin  added  by  any   retail  dealer   should  in  no  case 
exceed  the  average  added  by  such  dealer  for  the  same  size  and  grade  during  July,  1917. 


GOVERNMENT    CONTROL   OVER   PRICES. 


179 


average  price  for  the  year  1913  has  been  divided  into  the  average 
price  for  January  of  each  subsequent  year  to  obtain  the  relative 
prices. 

Since  January,  1913,  Pennsylvania  white-ash  stove  coal  has  ad- 
vanced 44  per  cent,  chestnut  42  per  cent,  and  bituminous  coal  44  per 
cent.  The  first  big  jump  in  the  price  of  all  kinds  of  coal  came  in  the 
year  from  January  15,  1917,  to  January  15,  1918.  Another  interest- 
ing fact  is  that  in  the  last  year,  from  January  15,  1918,  to  January  15, 
1919,  stove  coal  increased  17  per  cent,  chestnut  16  per  cent,  while 
bituminous  coal  increased  only  3  per  cent. 

AVERAGE  AND  RELATIVE   RETAIL   PRICES  OF  COAL  IN  TON  LOTS,   FOR  HOUSE- 
HOLD  USE.   JAN.    15   OF  EACH  YEAR,   1913  TO   1919,    INCLUSIVE. 

[Average  price  for  year  1913=100.] 


Period. 

Pennsylvania  anthracite,  white  ash. 

Bituminous. 

Stove. 

Chestnut. 

Average 
price. 

Relative 
price. 

Average 
price. 

Relative 
price. 

Average 
price. 

Relative 
price. 

Yvera^e  for  year  1913 

$7.73 
7.99 
7.80 
7.83 
7.93 
9.29 
9.88 
11.52 

100 
103 
101 
101 
103 
120 
128 
149 

$7.91 
8.15 
8.00 
7.99 
8.13 
9.40 
10.03 
11.61 

100 
103 
101 
101 
103 
119 
127 
147 

$5.41 
5.48 
5.97 
5.71 
5.69 
6.96 
7.68 
7.90 

100 
101 
110 
106 
105 
129 
142 
146 

Jail.  15,  1913                                      

Jan  15  1914 

Jan  .  1  5,  191  5  

Jan.  15,  1916                                           

Jan.  15,  1917 

Tan.  15,  1918  

Jen.  15,  1919  

SPECIAL  PRICES,  PREMIUMS,  AND  CHARGES. 

In  addition  to  the  prices  fixed  at  the  mine,  margins  for  middlemen 
and  retailers,  various  special  prices,  premiums,  and  charges  deter- 
mined by  the  Fuel  Administration  were 'also  established.1  These 
in  the  main  pertained  to  smithing  coal,  cannel  coal,  export  and 
bunker  coal,  coal  at  Lake  Michigan  and  Lake  Superior  docks,  and 
coal  from  wagon  mines,  prices  of  specially  prepared  coal  and  coal 
not  properly  picked  or  cleaned,  and  miscellaneous  orders  affecting 
the  delivered  price  of  coal. 

COSTS  MADE  THE  BASIS  OF  PRICE  FIXING. 

The  coal  prices  fixed  by  the  Fuel  Administration  were  based  upon, 
scientific  analyses  of  costs  conducted  by  a  special  committee.  Neither 
the  price-fixing  committee  nor  the  Food  Administration  to  any 
extent  availed  themselves  of  a  detached  scientific  committee  whose 
business  it  was  to  analyze  for  them  and  interpret  the  cost  sheets 
prepared  by  the  Federal  Trade  Commission.  The  Fuel  Adminis- 


1  See  fuel  orders  referred  to  above,  Chap.  II,  Title  IV,  sees.  1,  2,  3,  4,  5,  6,  and  7. 


180  HISTORY   OF  PRICES   DURING   THE   WAR. 

tration,  indeed,  during  1917  and  until  early  in  January,  1918,  took 
the  President's  tentative  prices  as  the  basis  for  all  revisions  and 
adjustments  without  serious  inquiry  into  their  justice.1  But  early 
in  1918  the  Fuel  Administrator  appointed  his  notable  committee  of 
engineers  to  make  a  painstaking  and  general  review  of  all  coal- 
production  costs  in  the  United  States  and  to  recommend  to  him 
scientific  verification  or  revision  of  each  price  tentatively  fixed.2 
The  Fuel  Administration  thus,  more  than  any  other  of  the  larger 
price-control  agencies,  made  intensive  and  highly  specialized  studies 
of  production  costs.  It,  unlike  either  the  price-fixing  committee  or 
the  Food  Administration,  was  concerned  primarily  with  the  price 
fixing  of  but  a  single  commodity — coal — and  could  make  close 
analyses  of  costs  for  various  parts  of  the  country.  The  elaborate 
confidential  cost  tables  worked  out  by  the  engineers'  committee  for 
Mr.  Garfield,  though  happily  as  often  useful  to  verify  as  to  revise 
former  prices,  gave  very  comprehensive  bases  for  the  fixing  of 
bituminous  and  anthracite  coal  prices. 

The  engineers'  committee  at  the  outset  determined  upon  a  method 
for  arriving  at  a  fair  price  for  coal.  It  considered  the  (a)  straight 
cost-plus  method — the  actual  cost  at  each  colliery  plus  a  fixed  sum 
or  percentage  of  profit;  (b)  modified  cost-plus  method — the  actual 
cost  at  each  colliery  plus  a  graduated  profit  decreasing  as  costs 
increase;  (<?)  average  cost  methods — prices  fixed  on  the  average 
cost  in  each  district ;  and,  (d)  pooling  methods — all  coal  sold  at  the 
average  cost  of  each  district  plus  a  profit,  and  the  returns  to  each 
colliery  adjusted  through  a  clearing  house  .at  a  price  proportioned 
to  its  cost  of  production.3 

1  These  prices,  though  perhaps  made  upon  a  belter  body  of  fact  than  were  a  majority 
of  prices  fixed,  were  based  on  average  figures  of  approximately  100,000,000  tons'  produc- 
tion, prepared  by  the  Federal  Trade  Commission.     They  were  relatively  meager  data,  com- 
prising generally  costs  from  the  larger  and  lower-cost  operators  of  each  district. 

2  In  January,  1918,  Mr.  Garfield  appointed  three  mining  engineers,  Mr.  Cyrus  Garnsey, 
jr.,  Mr.  R.  V.  Norris,  and  Mr.  J.  H.  Allport,  to  constitute  the  engineers'  committee  of  the 
Fuel  Administration.     They  were  men   of  scientific   training  and   considerable  practical 
experience.     The  committee  was  not  authorized  itself  to  fix  prices  of  coal,  but  to  study  and 
report  upon  methods  of  price  fixing  and  to  present  the  Fuel  Administrator  with  compre- 
hensive cost  data. 

3  Mr.  Cyrus  Garnsey,  jr.,  Mr.   R.  V.  Norris,  and  Mr.  J.   II.  Allport,  in  Publication  No. 
29,   of  the  Fuel   Administration,   issued    September  20,    1918,   outline   the   following   ad- 
vantages and  disadvantages  of  each  of  these  methods  : 

1.  Straight  cost-plus  method — Advantages.  —  (a)  All  producers  would  receive  the  same 
profit,  and  no  one  would  have  an  advantage  over  another  in  this  respect.  (6)  Apparently 
simple  in  plan  and  execution. 

Disadvantages. — Impracticable  of  application,  by  reason  of:  (a)  Resultant  multiplicity 
of  prices,  with  grave  disturbance  of  markets.  (&)  Continual  changing  of  prices  due  to 
inevitable  variations  in  each  producer's  costs,  (c)  Instability  of  the  industry,  due  to 
the  natural  disposition  of  consumers  to  purchase  the  lowest-price  coal,  (d)  Inefficiency 
in  operation  always  resulting  from  lack  of  incentive  in  cost-plus  operations,  (c)  Mate- 
rial reduction  in  output  and  reduction  in  quality,  due  to  the  natural  tendency  to  mine 
the  poorer  and  more  expensive  coal  with  a  guaranteed  profit,  and  to  leave  the  better 
and  cheaper  coal  in  reserve  to  be  mined  on  the  return  of  normal  conditions.  (f)  Con- 
tinual increase  in  all  costs  incident  to  extravagant  methods  encouraged  by  guaranteed 


GOVERNMENT   CONTROL   OVER  PRICES.  181 

It  seemed  to  the  engineers'  committee  that  they  must  find  a  system 
of  price  fixing  which  would  meet  especially  these  requirements : 

1.  A  price  fair  to  the  public. 

2.  Prevent  excessive  prices  or  profiteering. 

3.  Prevent  a  multiplicity  of  prices  in  any  district. 

4.  Encourage  legitimate  production. 

5.  Discourage  production  from  inefficient  and  unduly  costly  opera- 
tions. 

profits.  (g)  Labor  unrest  and  constant  demands  for  increases  due  to  the  knowledge 
of  a  guaranteed  profit  regardless  of  cost.  (h)  Practical  impossibility  of  arriving  with 
technical  accuracy  at  the  costs  of  each  separate  operation,  (f)  Impracticability  of  the 
Government's  policing  the  mines  and  securing  the  same  efficient  operation  and  pro- 
duction attained  by  the  individual  producer  under  the  stimulus  of  increased  profits. 
(j)  Illogical,  in  that  the  better  planned  and  managed  operations  are  discouraged,  as 
compared  with  poor  and  inefficiently  managed  properties. 

2.  Modified  cost-plus  method. — This  is  but  a  modification  of  the  preceding,  and  the  same 
discussion   applies,   modified   only   by  the  inclusion   of   a   somewhat   greater   incentive   to 
the  better  and  more  economical  operations. 

3.  Average  cost  methods — Advantages. — A  minimum  uniform  price  for  each  district  or, 
if  desired,  for  the  entire  country.     Disadvantages. —  (a)   The  average  cost  is  necessarily 
less  than  the  cost  of  about  half  the  total  tonnage.     Hence,  a  reasonable  profit  put  on 
the  average  cost  would  not  produce  the  necessary  tonnage.      (&)   The  tonnage  below  and 
up  to  the  average  cost  is  actually  produced  by  less  than  30  per  cent  of  the  operators  of 
the  country.     Hence,  the  great  majority  of  the  operators  producing  at  above  average  cost 
would  be  put  out  of  business  by  a  price  based  on  the  average. 

4.  Pooling  methods. — Pooling  may  be  done  on  either  cost-plus,   modified  cost-plus,  or 
on  the  prices  established  by  the  United  States  Fuel  Administration.     Advantages. —  (a)  A 
uniform  price  to  consumers  for  sections  and,  if  desired,  for  the  entire  country.      (6)   A 
present  lower  price  to  consumers  based  on  weighted  average  cost,     (c)  A  simplification  of 
all  present  pooling  arrangements,  as  all  coal  to  each  pool  would  have,  or  could  be  ar- 
ranged to  have,  the  same  price,     (d)  A  return  to  the  consideration  of  quality  instead  of 
cost,  as,  with  all  coal  at  the  same  price  to  consumers,  the  higher  qualities  would  naturally 
be   preferred.      Disadvantages   of  pooling  cost-phis    or  modified   cost-plus   methods. —  (a) 
Continual  variation  in  pool  prices,  due  to  inevitable  variations  in  producers'  costs.      (6) 
Unfair  and  illogical,  in  that  the  better  located  and  managed  operations  are  made  to  pay 
tribute  to  the  poor  and  badly  managed  one?,      (c)    A  general  and  considerable  increase  in 
cost  inevitably  resulting  from  any  method  involving  guaranteed  profits  with  a  disregard 
of  economy,      (d)   A  material  reduction  in  output,  due  to  lack  of  incentive  and  resulting 
inefficient  methods,   the  employment  of  unnecessary   labor,   the  mining  of  the  more  ex- 
pensive and  less  desirable  qualities  of  coal  for  the  ultimate  benefit  of  the  mines,  and  the 
execution  of  development  not  immediately  needed,     (e)   A  slackening  of  the  efforts  of  em- 
ployees, which  is  the  usual  result  of  a  lack  of  incentive  to  the  producer,  with  the  re- 
sulting lack  of  interest,      (f)    Tfie  installation  of  an  unsound  policy  tending  to  encourage 
the  inefficient  and   discourage   the   efficient  producer,      (g)   The   ever-present  temptation 
to  allow  costs  to  increase  with  the  hope  of  readjustment  of  prices,      (h)   Dissatisfaction 
to  both  labor  and  to  producers  from  the  knowledge  that  other  and  less  efficient  operations 
have  higher  limits  of  price.     The   disadvantage  of  pooling  on   the   prices   fixed   by   the 
United  States  Fuel  Administration  are  the  same  as  suggested  above,  without  some  of  the 
special  disadvantages  of  cost-plus  methods.     Disadvantage  of  pooling  in  general. —  (a)   A. 
very   large   capital   required   to  handle  such   stupendous  operations,      (b)    Enormous  and 
extended  credits  required  to  finance  the  producers,      (c)    Lack  of  organization  to  handle 
this    new    business.       (d)   Undesirability    of    creating    an    organization    with    its    army 
of  additional  employees  at  the  present  time,      (c)   Inadvisability  of  putting  a  new  and 
untried   plan   into   operation   at  the  present  time,      (f)    Impossibility   of  obtaining,  with 
sufficient  promptness.,   the  costs  necessary   to  fix   pooling  prices  with   the  necessary   ac- 
curacy,     (g)    Interference    with    present    established    methods    of    handling    coal,    with 
serious  risk  of  crippling  its  distribution  and  unnecessarily   creating  a  shortage. 

None  of  these  suggested  methods  seemed  to  fill  the  peculiar  conditions  incident  to 
price-fixing  of  coal  at  the  mines,  and  it  devolved  upon  the  engineers'  committee  to  de- 
velop some  method  better  suited  to  the  conditions  of  the  problem. 


182  HISTORY   OF   PRICES   DURING   THE   AVAR. 

G.  Insure  to  the  producer  "  the  cost  of  production,  including  the 
expense  of  operation,  maintenance,  depreciation,  and  depletion,  with 
a  just  and  reasonable  profit,"  as  required  by  the  Lever  Act. 

The  committee  determined  finally  that  it  could  best  attain  these 
ends  by  finding  the  bulk  line  of  production,  and  allowing  the  Fuel 
Administrator  personally  to  add  whatever  margin  in  his  judgment 
each  district  required.  Costs,  accordingly,  were  obtained  from  the 
Federal  Trade  Commission  as  filed  by  each  operator  in  the  country, 
and  were  studied  by  the  committee,  listed  and  adjusted1  for  price 
fixing.  These  data,  together  with  the  percentages  of  each  cost  in  the 
total  production  of  each  district,  were  plotted  to  show  graphically  the 
range  and  extent  of  variation  in  each  district.  Then,  upon  these 
diagrams,  was  drawn  the  bulk  line,  showing  the  indispensable  ton- 
nage required  from  that  district.2 

When  the  committee  set  about  its  inquiry  early  in  1918,  it  had 
costs  for  the  production  of  coal  in  the  United  States  during  August 
and  September,  1917.  These  data,  together  with  later  reports,  were 
generally  used  as  a  basis  of  costs.3 

BUummous  costs. — The  committee,  confronted  with  a  confusing 
mass  of  cost  figures  representing  95  per  cent  of  the  bituminous  pro- 
duction of  the  country,  evolved  a  scheme  of  unique  graphic  pre- 
sentation which  made  comparisons  simple.  It  made  for  each  coal 

1  Many,  especially  of  the  small   operators,  were  inexperienced  in  bookkeeping,  and  sub- 
mitted   cost   sheets   which,    while   accurate   in    totajs,    were   grievously    mixed   in   details. 
The  most   common  of  the  cost  adjustments  which  were   made  .pertained  to   supplies,   re- 
serves,   salaries,    special    charges,    outside   profits,    and    fuel    charges    for   colliery    power. 
These  adjustments  of  the  Federal  Trade  Commission  cost  figures  were  made  simply  to  put 
all  costs  on  the  same  basis. 

2  Since  the   "  bulk  line "   of  production,   adopted  by  the  Fuel   Administration,   came  so 
prominently    into    the   consideration    also  of-  the   price-fixing   committee,    it    is   of  especial 
interest  to  note  the  following  frank  outline  of  its  merits  and  demerits  by  the  engineers' 
committee,  who  recommended  it  to  the  Fuel  Administration. 

Advantages  of  the  "  Imlk  line  "  system. — The  method  of  fixing  prices  by  the  "bulk  line" 
principle  recognizes  the  economic  syllogism  that  "  the  price  of  any  article  necessary  to  a 
community  will  be  fixed  by  tho  cost  of  producing  that  necessary  portion  of  such  article 
involving  the  greatest  expense."  fa)  This  assures  to  all  producers  profits  dependent 
upon  their  ability  and  exertions,  only  limited  by  the  establishment  of  a  reasonable  price 
to  the-  consumer.  (*>)  It  does  not  unduly  increase  the  price  of  coal  to  the  consumer  over 
the  minimum  price  possible  under*  other  methods.  (c)  It  tends  to  encourage  maximum 
production  and  necessary  development  by  allowing  to  the  producer  the  benefit  of  reduced 
costs  due  to  greater  production.  (<1)  It  avoids  bad  feeling  among  the  producers  and 
among  the  workmen  by  allowing  a  fixed  price  in  each  district  and  not  apparently  show- 
ing favoritism  to  special  producers,  (e)  It  tends  to  encourage  the  fit  and  discourage 
the  unfit,  (f)  The  method  is  susceptible  of  refinement  and  extension,  making  it  possible 
to  eliminate  undue  profits  to  the  producer  and  adjust  prices  from  time  to  time  to  the 
ultimate  advantage  of  the  consumer. 

Disadvantage  of  the  "bulk  line"  system. —  (a)  Considerable  profits  to  the  lowest-cost 
operators,  (fi)  A  price  for  coal  greater  than  one  based  on  the  average  cost,  by  the 
amount  by  which  the  "bulk  line"  exceeds  such  average. 

This  method  appeared  to  be  better  suited  to  the  conditions  than  any  of  the  others 
suggested,  and  after  a  careful  study  by  the  United  States  Furl  Administrator  it  was 
adopted. 

3  It  is  of  interest  that  the  committee  later  found,  when  cost  data  for  extended  periods 
were  had,  that  the  two  months  mentioned  above  were  fairly  representative,  as  to  cost, 
of  the  average  year. 


GOVERNMENT   CONTROL  OVER   PRICES.  183 

district  in  the  country,  of  which  there  were  99,  a  graph  showing 
horizontally  from  left  to  right  various  percentages  of  production 
from  0  to  100.  That  same  graph?  when  read  vertically  from  the 
lower  left  corner,  showed  various  unit  costs  of  production  per  ton 
from  0  to  the  highest  cost  found.  There  were  then  drawn  upon 
each  chart  the  total  costs  for  the  district,  as  reported  and  also  as 
adjusted,  beginning  at  the  lowest  cost  and  the  tonnage  which  could 
be  produced  at  that  unit  cost.  The  two  cost  lines  thence  (i.  e.,  the 
reported  and  adjusted  cost  lines)  were  made  gradually  to  rise  from 
this  lowest  to  the  very  highest  cost  in  the  district,  showing  con- 
stantly the  increased  production  that  could  be  had  with  each  in- 
crease in  cost.  The  bulk  line,  between  these  two  extremes,  repre- 
sented the  percentage  of  production  required  and  marked,  there- 
fore, the  basis  for  fixing  a  price.  The  bulk  line  usually  was  fixed 
at  a  point  to  assure  the  production  at  a  minimum  of  profit,  of  90 
per  cent  of  the  total  capacity,  thus  cutting  off  the  upper  crust  of 
high-cost  producers.1  The  bulk  line  of  the  chart,  after  adding 
whatever  margin  was  determined  upon  by  the  Fuel  Administrator, 
gave  the  necessary  realization  for  run-of-mine  coal  in  that  district. 
Spreads  were,  however,  frequently  added  to  this  price  to  make  pos- 
sible screening  and  special  prices  for  prepared  sizes. 

A  study  of  the  average  costs,  bulk  line,  and  prices  fixed  for  84 
per  cent  of  the  bituminous  coal  production  in  the  United  States 
during  August  and  September,  1917,  gives  interesting  generaliza- 
tions.2 The  weighted  average  margin  between  costs  and  the  prices 
fixed  for  substantially  the  entire  bituminous  production  of  the  coun- 
try was  45.6  cents.  It  is  of  equal  interest  that  the  weighted  average 
margin  between  the  bulk  line,  which  represents  the  highest  price 
necessary  to  produce  any  part  of  the  necessary  coal,  and  the  prices 
fixed  by  the  Fuel  Administrator  was  26  cents.3 

1  These  include  :  Mines  which  have  failed  under  normal  competitive  conditions  and  have 
been    reopened    under   the   stimulus   of   the   high   prices   preceding   Government    control ; 
mines  abandoned  as  exhausted  and  reopened  for  the  few  remaining  pillars :   new  enter- 
prises in   the  development   stage  :   mines  opened  on  heds  so  thin  or  of  such  poor  quality 
that  they  could  not  operate  under  normal  conditions;  sinall  mines  on  outcrop  coal,  often 
of   poor   quality,    which    have   neither    capital    nor    equipment   for   economical    working ; 
mines  which  have  encountered  faults  or  in  which  the  coal  has  thinned  or  split,  or  the 
quality  has  so   deteriorated  as  to  prevent  working  at  a  reasonable  cost ;   and,   not  the 
least    of    this    group,    mines    so    badly    managed    as    to    show    unwarrantable    costs    of 
operation. 

•All  these  classes  of  mines  are  unjustifiable  under  war  conditions.  They  use  labor 
inefficiently.  Often  their  records  show  less  than  half  the  tonnage  per  employee  usually 
obtained  in  their  district,  and  their  elimination  is  an  economical  advantage  to  a  district 
in  releasing  labor  to  more  efficient  mines. 

In  this  high-cost  group  occasionally  are  found  mines  which,  have  a  coal  of  unusually 
high  quality  or  fitted  for  special  use,  for  which  a  market  at  prices  above  those  of  the 
district  has  always  existed.  Such  mines,  on  proving  their  special  conditions,  may  re- 
ceive consideration  for  special  prices  sufficient  to  allow  a  fair  profit  on  their  higher  costs. 

2  See  bituminous  chart  in  section  on  "  The  determination  of  a  fixed  price." 
*  The  engineers'  committee  add  that : 

The  average  cost  of  the  84  per  cent  of  the  total  coal  represented  for  the  two  months 
of  August  and  September,  1917,  was  reported  to  be  $1.696.  The  adjustments  heretofore 


184 


HISTORY  OF  PRICES  DURING  THE   WAR, 


Anthracite  costs. — The  inquiry  into  the  costs  of  mining  anthracite 
coal,  which  followed  that  for  bituminous,  covered  costs  for  the  vari- 
ous sizes  of  white-ash  anthracite,  red  ash,  and  Lykens  Valley  coals 
for  the  six  months'  period,  December,  1917,  to  May,  1918,  inclusive. 
The  anthracite  field  covers  a  smaller  district,  is  indeed  itself  a  single 
district,  and  gave  relatively  few  problems  in  the  adjustment  of  re- 
ported costs  to  a  price-fixing  basis.1  But  the  spread  in  anthracite 
prices  of  the  varying  sizes,  which  for  the  chosen  period  ranged. from 
$5.244  for  nut  to  $2.074  for  barley  coal,  made  vital  the  question  of 
the  percentage  of  sizes  produced  at  the  different  collieries.  The 
percentage  of  prepared  coal  reported  from  different  collieries,  more- 
over, varied  from  over  80  per  cent  to  below  30  per  cent  for  fresh- 
mined  coal,  and  the  spread  in  prices  for  the  various  sizes  had  to  be 
predicated  upon  some  percentage  to  allow  for  variations.2 

described  raised  this  reported  cost  to  $1.706,  a  very  strong  indorsement  of  the  honesty 
of  the  reports  made  by  the  operators. 

The  average  "  bulk  line  "  was  fixed  at  $1.002,  or  19.6  cents  above  the  average  adjusted 
cost.  This  represents  the  margin  required  to  assure  the  mining  of  the  necessary  coal,  as 
compared  with  the  average  cost,  which,  of  course,  involves  the  mining  of  only  coal  up  to 
or  below  the  average  cost ;  in  other  words,  half  the  available  output. 

The  weighted  average  of  all  prices  fixed  is  $2.162  per  ton  and  the  average  margin 
above  the  "  bulk  line  "  is  26  cents,  representing  all  the  above  mentioned  charges  and  all 
profit  for  the  higher  cost  necessary  mines ;  the  margin  above  the  average  weighted  cost 
for  the  whole  country  is  45.6  cents  per  ton,  which,  compared  with  profits  in  other  busi- 
nesses, certainly  does  not  show  any  signs  of  profiteering  in  the  coal  business  as  a  whole. 
The  prices  fixed  are  also  sufficient,  on  the  basis  of  the  reported  costs,  to  permit  the  mining 
of  98.4  per  cent  of  all  available  coal,  without  loss. 

1  Mr.  R.  V.  Norris,  a  member  of  the  engineers'  committee  of  the  Fuel  Administration 
and  also  of  the  price-fixing  committee,  has  prepared  an  interesting  paper  on  "  Anthracite 
mining  costs,"  which  was  printed  in  Bulletin  No.  146,  by  th'e  A.  I.  M.   S.,  in  February, 
1919,  by  the  Fuel  Administration. 

2  Mr.  Norris  explains  the  method  of  making  these  adjustments  as  follows : 

The  logical  method  of  adjustment  is  to  calculate  actual  costs  to  costs  as  of  the  stand- 
ard percentage  of  sizes,  so  that  the  margin  between  the  adjusted  costs  and  the  average 
realization  shall  be  the  actual  margin  for  each  colliery  between  its  actual  costs  and  actual 
realization  due  to  its  particular  percentage  of  sizes.  As  a  basis  for  realization  the 
actual  percentage  of  sizes  for  fresh-mined  coal  for  the  6-month  period  was  adopted. 
This  percentage  is  given  below. 


Size  of  coal. 

Mesh,  in  inches. 

Percentage  of  sizes. 

Through, 
round. 

Over, 
round. 

Fresh 
mined. 

Washery. 

Fresh 
mined 
and 
washery. 

Broken                                                        

4; 

!! 

53 
"» 

31    31 

6.8 
14.6 
19.6 
24.7 
9.1 
11.6 
3.2 
4.9 
3.9 
1.6 

0.4 
1.2 
2.3 
10.1 
10.0 
21.4 
14.9 
27.5 
8.8 
3.4 

6.2 
13.5 
18.2 
23.5 
9.2 
12.4 
4.2 
6.8 
4.3 
1.7 

Egg  .                                    

n 

Stove                                                         

Nut                  

Pea 

Buckwheat 

Rice 

TT*  -A 

~h~  T5 

Barley                                      

Boiler                                                                 

For  adjustment  as  a  base  for  fixing  a  spread  of  prices  the  percentages  used  were, 
taken  at  even  figures,  prepared,  65  per  cent ;  pea,  9  per  cent ;  buckwheat,  12  per  cent ; 
and  smaller,  14  per  cent. 

The  adjustment  finally  arrived  at  after  long  study  was  tested  on  actual  reports  from 
collieries  having  percentages  that  varied  from  over  80  per  cent  to  under  30  per  cent  pre- 


GOVERNMENT   CONTROL   OVER   PRICES. 


185 


The  engineers'  committee,  when  it  came  finally  to  overhaul  the 
earlier  prices  that  had  been  fixed  for  the  three  important  grades  of 
anthracite  coal,  made  charts  to  show  the  reported  and  adjusted  costs 
for  white  ash,  red  ash,  and  Lykens  Valley  coal.1  They  found,  after 


pared  coal  and  was  found  to  be  correct  within  a  maximum  variation  of  less  than   IS  per 
cent.     It  was  as  follows  : 


For  each  1  per  cent  variation. 

Above 
standard 
per  cent 
deduc- 
tion. 

Below 
standard 
per  cent 
addition. 

1.20 

1.20 

Pea                                                                 

.85 

.85 

.75 

.75 

Smaller... 

.50 

.50 

As   examples   of   the   working  of   this   adjustment   with   prices   assumed    at   about    the 
average  for  the  6  months  and  taking  mines  well  away  from  average  percentage  of  sizes. 


Size. 

Base 
per 
cent 
sizes. 

Base 
price. 

Realiza- 
tion. 

Mine  A 
per 

cent 
sizes. 

Correc- 
tion 
percent. 

Actual    Mi»erB 

r^liza-       cPent 
tlon-        sizes. 

Correc- 
tion 
pier  cent. 

Reali- 
zation. 

Prepared       .          .  . 

Co 

$5.10 

$5.315 

73.1 

-9.72 

$3.730         55.1 

+  11.880 

$2.  810 

Pea 

9 

3.70 

.333 

6.4 

+2.21 

.237  :       15.3 

-  5.355 

.566 

Buckwheat  

12 

3.20 

.384 

10.4 

+1.20 

.333         13.7 

-  1.275 

.438 

Smaller 

14 

2.20 

.308 

10.1 

+1.95 

.222         15.9 

-     .950 

.350 

Total 

100 

4.340 

100.0 

-4.36 

4.522       100.0 

+  4.30 

4.164 

I 

Assumed  cost  for  each  mine $4. 000  $4. 000 

Actual  margin 522  . 164 

Standard  realization *.  340  4. 340 

C  alculated  cost  as  of  standard  per  cent  sizes- 
Mine  A— $4X0.9564  per  cent 3. 826  4. 172 

Mine  B— $4X104.30  per  cent 

Calculated  margin , 


514        .168 

The  correction  for  mine  A  is  then  4.36  per  cent  and  the  adjusted  cost  $3.826,  showing 
51.4  cents  margin  on  the  .$4.34  standard  realization  against  52.2  cents  actual  margin. 
Similarly  for  mine  B,  the  correction  is  4.30  per  cent,  giving  an  adjusted  cost  of  $4.172 
and  a  margin  of  16.8  cents,  as  compared  with  the  actual  margin  of  16.4  cents.  Thus  the 
adjusted  costs  on  the  chart  bear  a  true  relation  to  the  realization  received  from  a  scale 
of  prices  for  the  various  sizes  based  on  the  standard  or  average  percentage  of  sizes 
adopted  as  a  base,  regardless  of  the  actual  percentage  of  sizes  produced  by  each  opera- 
tion, and  prices  can  be  fixed  from  the  chart  line  of  adjusted  costs  which  will  result 
in  giving  each  mine  its  intended  margin.  The  correction,  of  course,  is  an  allocation  based 
on  realization  from  the  different  sizes  and  could  be  made  more  accurately  by  taking 
into  account  each  size  produced,  but  at  the  cost  of  more  time  than  was  available  for 
the  work.  With  a  material  variation  in  price,  different  factors  of  correction  should  be 
calculated. 

1  See  anthracite  chart  in  section  on  "  The  determination  of  a  fixed  price." 


186 


HISTORY   OF   PRICES   DURIXG   THE   WAR. 


making  weight-ex!  averages,  the  following  average  and  bulk-line  costs 
for  standard  fresh-mined  white  ash  anthracite: 


Description. 

Costs, 
averages 
returned. 

Costs, 
adjusted. 

Cost,  90 
per  cent 
bulk  line. 

Excluding  wasliery  coal: 
AH  operations,  each  coJlierv  separate         .        

$3.85 
3.71 
4.37 

.",.  sr> 

3.57 

S3.  91 
3.79 
4.36 
3.91 

3.77 

$4.80 
4.65 
4.97 
4.38 

4.M 

All  company  operations  each  colliery  separate 

All  independent  operations,  each  colliery  separate  

All  operations,  each  company  operating  2  or  more  collieries  consolidated  . 
Including  washery  coal. 
All  operations,  each  company  operating  2  or  more  collieries  consolidated  . 

A  differential  of  75  cents  per  ton,  as  had  been  made  by  the  Presi- 
dent on  August  23, 1917,  was  made  for  pea  size  and  above  (equivalent 
to  52.95  cents  per  ton  for  all  sizes)  for  the  independent  operators 
over  certain  companies  with  railroad  affiliation,  known  as  the  "  com- 
panies/' It  is  of  interest,  in  connection  with  the  above  table  of 
average  and  bulk-line  costs,  to  study  the  prices  received  for  white- 
ash  anthracite  as  prepared  by  the  engineers'  committee.1 

It  is  noteworthy  that,  despite  the  elaborate  anthracite  cost  analyses 
later  made  by  the  engineers'  committee,  the  prices  of  anthracite  coal 
were  left  substantially  as  fixed  by  the  President  save  for  two  labor 
increases  and  the  early  reduction  in  the  price  of  pea  coal.  The  tables 
following  make  possible  a  comparison  of  anthracite  prices  as  origi- 

1  The  prices  received  by  the  companies  and  independents  have  not  been  separately 
averaged,  as  were  the  costs,  but  calculating  on  the  differential  and  assuming  the  per- 
centages the  same  for  companies  and  independents,  which  is  only  approximately  the  case, 
the  selling  price  of  fresh  mined  coal  would  average  for  companies  $4.287  and  for  inde- 
pendents $4.817.  Margins  over  reported  costs  of  companies  would  be  58  cents  and  for 
independents  45  cents,  with  a  general  average  margin  for  all  fresh  mined  coal  of  56 
cents  and  for  all  coal  including  washery  of  71  cents  per  ton,  and  under  "  bulk-line " 
costs  fresh  mined  companies,  36  cents ;  independents,  15  cents ;  total,  39  cents,  including 
washeries  consolidated  sheets  total  of  7.5  cents. 

These  margins  include  all  expenditures  for  Federal  income  and  excess-profits  taxes, 
selling  expenses,  interest  charges,  expenditures  for  improvements,  and  developments  to 
increase  output,  excess  of  capital  expenditures  over  normal  cost,  and  all  profit  on  the  in- 
vestment of  about  $8  per  ton  annual  output. 


Size. 

Fresh  mined  coal. 

Bank  coal. 

Total,  including 
banks. 

Percent. 

Average 
price. 

Per  cent. 

Average 
price. 

Per  cent. 

Average 
price. 

Broken 

68 
14.6 
19.6 
24.7 
9.1 

$4.889 
5.028 
5.161 
5.244 
3.687 

0.4 
1.2 
2.3 
10.1 
10.0 

$4.416 
4.815 
5.060 
5.246 
3.696 

6.2 
13.5 
18.2 
23.5 
9.2 

$4.886 
5.  027 
5.160 
5.244 
3.698 

Fgg  

Stove 

Nut 

Pea      ..                            . 

Total  and  weighted  average  pre- 
pared and  pea  

74.8 

4.959 

24.0 

4.544 

3.213 
2.452 
1.767 
2.123 
1.555 

70.6 

4.947 

Buckwheat 

11.6 
3.2 
4.9 
3.9 
1.6 

3.342 
2.482 
2.231 
2.341 

2.202 

21.4 
14.9 
27.5 

8.8 
3.4 

12.4 
4.2 
6.8 
4.3 
1.7 

3.324 
2.473 
2.874 
2.304 
2.162 

Rice  

Barley 

Boiler    

pcro.p.Tjvngs 

Total  and  weighted  average  small 
sizes.  

25.2 

2.795 

76.0 

2.  339 

29.4 
100.0 

2.697 

Grand  total  

100.0 

4.414 

100.0 

2.868 

4.285 

GOVERNMENT    CONTROL   OVER   PRICES. 


187 


nally  fixed  by  the  President  and  as  they  stood  after  the  signing  of 
the  armistice.1 

PRICES  FIXED  BY  THE  PRESIDENT  AUG.  23,  1917. 


White  ash. 

Red  ash. 

Lykens  Valley. 

Company. 

Independ- 
ent. 

Company. 

Independ- 
ent. 

Company. 

Independ- 
ent. 

$4.55 
4.45 
4.70 
4.80 
4.00 

$5.30 
5.20 
5.45 
5.  55 
4.75 

$4.75 

4.65 
4.90 
4.90 
4.10 

$5.50 

5.40 
5.  Co 
5.  65 

4.85 

$5.00 
4.90 
5.30 
5.30 
4.35 

$5.75 
5.65 
6.05 
0.05 
5.10 

Egg              .   .  .             

Stove 

Chestnut  

Pea  

FIXED  PRICES,  DEC.  31,  1918. 


White  ash. 

Red  ash. 

Lykens  Valley. 

Company. 

Independ- 
ent. 

Company. 

Independ- 
ent. 

Company. 

Independ- 
ent. 

Broken    

$595 
5.85 
6.10 
6.20 
4.80 

$6.70 
6.60 
6.85 
6.95 
5.35 

$6.15 
6.05 
6.30 
6.30 
4.90 

$6.90 
6.80 
7.05 
7.05 
5.75 

$6.40 
6.30 
6.70 
6.70 
5.15 

$7.15 
7.05 
7.45 

7.45 
5.90 

Egg                      

Stove 

Chestnut 

Pea  

The  average  costs  of  producing  anthracite  coal,  as  they  were  re- 
ported for  the  six-month  period  from  December,  1917,  to  May,  1918, 
including  the  increase  of  December  1,  1917,  but  not  that  of  Novem- 
ber 1,  1918,  follows : 2 

AVERAGE  ANTHRACITE  COST,  DECEMBER,  1917,  TO  MAY,  1918. 

— 

Cost  per  ton. 


Fresh 
mined  coal, 
35,256,550 
tons. 

Washery 
operations. 
3,431,916 
tons. 

Total,  in- 
cludinsr 
washeries, 
38,688,466 
tons. 

Labor                                                                                                     

$2.  593 

$0.  687 

$2.423 

Supplies 

.616 

.260 

.584 

Transportation,  mine  to  breaker    

.004 

.007 

.004 

Royalty  current  .". 

.153 

.102 

.148 

Royalty  advance  ... 

.002 

.002 

Depletion  

.099 

.077 

.097 

014 

.024 

.016 

Depreciation 

.091 

.086 

.090 

Pro  rata  suspended  cost  of  stripping  .  .           

.023 

.021 

Contract  stripping  End  loading  

.009 

.009 

Taxes  local 

.054 

.034 

.052 

Insurance,  current  .                                       

.016 

.014 

.016 

Insurance'  liability                                                      

.058 

.018 

.055 

Officers'  salaries  and  expenses 

.030 

.019 

.029 

.048 

.024 

.045 

Legal  expenses  ....                                                   

.005 

.003 

.005 

Miscellaneous                                                                         

.026 

.023 

.026 

Total                                                                           

3.841 

1.37S 

3.622 

Increase  over  M*ty  to  November  1917                                         

.764 

.365 

.719 

1Mr.  R.  V.  Norris,  backed  by  the  engineers'  committee,  concludes  from  these  tables 
that  "  the  selling  price  of  anthracite  has  been  increased  but  3O.5  per  cent  over  the 
prewar  price,  while  the  cost  of  production  has  gone  up  52  per  cent,  the  difference  having 
been  absorbed  by  the  operators." 

2  Fuel  Bulletin  No.  146. 


188  HISTORY   OF   PRICES   DURING   THE    WAR. 

The  final  realization  for  all  companies  and  all  sizes,  including 
washery  coal  and  both  of  the  labor  increases,  was  calculated  to  aver- 
age  $5.13  per  ton,  while  the  bulk  line,  as  shown  previously,  plus  the 
November,  1918,  labor  increase,  amounts  to  $5.32. 1 

(6)   THE  CONTROL  OVER  COKE.  2 

It  has  already  been  noted  that  the  market  prices  of  coke,  so  closely 
allied  with  iron  and  steel,  rose  to  unprecedented  heights  during  the 
summer  of  1917.  The  wholesale  price  for  Connellsville  coke,  furnace, 
prompt  shipment,  f.  o.  b.  ovens,  which  just  a  year  before  had  stood  at 
$2.75,  shot  to  $13.42  in  August,  1917.  The  War  Industries  Board, 
by  reason  of  its  concern  in  the  stabilization  of  iron  and  steel  prices, 
had  rescued  coke  quotations  from  a  runaway  market  by  fixing  them 
definitely  at  a  flat  rate  of  $6  per  ton  on  September  24,  1917.  It  is  of 
interest  that  the  Fuel  Administration  later  confirmed  this  price  and 
upon  it  as  a  basis  figured  numerous  differentials  and  special  prices 
for  various  districts.3  The  Fuel  Administrator  on  November  9,  1917, 
without  any  specific  mention  of  previous  price  fixing,  established 
maximum  prices  to  be  effective  the  following  day.  These  maximum 
prices  for  coke  made  in  ovens  without  by-product  recovery  east  of 
the  Mississippi  River  were : 

Blast   furnace $6.  00 

Foundry  coke,  72-hour  selected 7.00 

Crushed  coke,  over  1-inch  size 7.'30 

These  prices  were  made  applicable  per  ton  of  2,000  pounds  f.  o.  b. 
cars' at  the  plant  where  coke  was  manufactured.  It  was  declared 
that  the  maximum  prices  for  various  grades  of  beehive  coke  made  in 
districts  other  than  these  should  bear  the  same  ratio  to  the  estab- 
lished price  of  the  coal  from  which  the  coke  was  made  as  the  aver- 
age contract  prices  of  the  same  grades  of  coke  had  to  the  average 
contract  prices  of  coal  during  the  years  1912  and  1913. 

It  is  estimated  that  10  per  cent  only  of  the  total  output  of  coke 
is  sold  on  the  open  market,  and  there  is  no  satisfactory  measure 
from  market  quotations,  therefore,  of  the  relative  point  at  which 
coke  prices  were  fixed  or  the  effect  of  price  fixing  upon  the  general 
market  level  as  realized  for  the  bulk  of  sales.  There  can  be  no  ques- 
tion that  the  September  price  fixing  had  a  tremendous  influence  in 
the  pulling  of  the  market  price  from  its  historic  peak  in  August  and 
holding  it  at  a  lower  level  thereafter.  But  if  one  would  measure  the 
effects  of  price  fixing  upon  the  remaining  90  per  cent  of  the  total 

!R.  V.  Norrifc. 

2  See  also  chapter  on  "  Iron  and  steel,"  under  the  War  Industries  Board  controls. 
8  See    "  General    Orders,    Regulations,    and    Rulings "    of    the   Fuel    Administration,    Ch. 
VI,  Title  I,  sec.  1. 


GOVERNMENT   CONTROL,   OVER   PRICES. 


189 


output,  he  must  compare  the  fixed  price  with  previous  contract 
prices.  There  have  been  ca]culated  below  so-called  realization  prices 
for  the  United  States  from  the  spot  quotations  and  the  average 
annual  realization  reported  by  the  Geological  Survey.1  The  com- 
parison has  been  facilitated  by  turning  the  weighted  realization 
prices  into  relative  prices,  by  letting  the  base  price  from  July  1,  1913, 
to  June  30,  1914,  equal  100. 

The  accompanying  table  of  "  spot "  prices  presents  a  marked  con- 
trast to  the  realization  price  table.2  Price  fixing  beyond  doubt  scaled 
the  market  quotations  from  unprecedented  heights  for  the  smaller 
percentage  of  coke  sales.  The  effect  of  price  fixing  upon  the  great 
bulk  of  sales  by  contract  is,  however,  not  so  clear.  The  realization 
prices,  indeed,  went  far  beyond  their  1917  peak  several  months  after 
control  had  set  in,  and  not  during  the  whole  of  1918  did  they  come 
down  from  that  height. 

WEIGHTED   REALIZATION   PRICES   FOR   ALL   CONNELLSVILLE   COKE. 
ACTUAL  PRICES  PER  NET  TON. 


Month. 

1913 

1914 

1915 

1916 

1017 

1918 

January  

S2.  51 

52.12 

$2.03 

$2.65 

$4.87 

$6  03 

February     .        .               .... 

2.38 

2.12 

2  03 

2  68 

4  88 

6  03 

March 

2  37 

2  12 

2  03 

2  69 

4  88 

6  03 

April  

2.34 

2.12 

2.03 

2.61 

4.77 

6  03 

May 

2.34 

2.11 

2  03 

2  60 

4  79 

G  03 

June  '  

2.34 

2.10 

2.04 

2.62 

4.97 

6.03 

July                

2.37 

2.10 

2.05 

2  64 

5  04 

6  03 

\ugu^t 

2  38 

2  10 

2  03 

2  64 

5  09 

6  03 

September  

2.36 

2.09 

2.05 

2.65 

4.96 

6  03 

October 

2.33 

2.08 

2  09 

2  78 

4  69 

6  03 

November 

2  31 

2  08 

2  12 

2  93 

4  69 

6  03 

December  

2.30 

2.07 

2.17 

3.03 

4  69 

6  03 

Year  

2.36 

2.10 

2.06 

2.71 

4.86 

6.03 

RELATIVE  PRICES. 


January      

113 

95 

91 

119 

218 

2?0 

February 

107 

95 

91 

120 

219 

270 

March 

106 

95 

91 

121 

219 

270 

\pril       

105 

95 

91 

117 

214 

270 

Alay 

105 

95 

91 

117 

215 

270 

June        

105 

94 

91 

117 

223 

270 

July                  

106 

94 

92 

318 

226 

270 

August 

107 

94 

91 

118 

228 

270 

September   

106 

94 

92 

119 

222 

270 

October 

104 

93 

94 

126 

210 

1?70 

November  

104 

93 

'95 

131 

210 

270 

December            

103 

93 

97 

136 

210 

270 

Year        

106 

94 

92 

122 

218 

270 

1  These  realization  prices,  figured  by  Mr.  C.  E.  Lesher,  were  found  in  the  same  manner 
as  those  for  bituminous  coal,  except  that  the  assumption  was  made  that  10  per  cent  of 
the  total  output  was  sold  on  the  market  and  90  per  cent  under  contract,  and  that  the 
coke  year  was  from   January   to  December.     The   prices   for  furnace  and  foundry  coke 
were  averaged  in  accordance  with  the  relative  production  of  each  in  1916,  as  reported  to 
the  Geological  Survey  by  the  producers. 

2  Both  of  these  series  are  presented  with  more  detail  in  "  The  Prices  of  Coal  and  Coke," 
by  C.  E.  Lesher,  W.  I.  B.  Bulletin  No.  35. 


190 


HISTORY   OF   PRICES   DURING  THE   WAR. 


WEIGHTED  "SPOT"  PRICES  OF  ALL  CONNELLSVILLE  COKE. 

ACTUAL  PRICES  PER  NET  TON. 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January 

$3.90 

$1.87 

$1  52 

$2  96 

$9.51 

$6  03 

February  .  . 

2.54 

1.87 

1.52 

3.38 

9.66 

6.03 

March 

2.42 

1.92 

1  52 

3.48 

9.66 

6  03 

April 

2  18 

1  88 

1  52 

2  44 

7  43 

6  03 

May--- 

2.15 

1.79 

1  52 

2  33 

7  83 

6  03 

June 

2  13 

1  77 

1  57 

2  51 

11  26 

6  03 

July 

2  46 

1  76 

1  65 

2  76 

12  76 

6  03 

August 

2  51 

1  72 

1  52 

2  82 

13  59 

6  03 

September 

2.31 

1  66 

1  62 

2  95 

11  14 

6  03 

October 

2  10 

1  61 

2  04 

4  85 

6  00 

6  03 

November  . 

1.84 

1.53 

2.30 

6  91 

6  03 

6  03 

December 

1  77 

1  51 

2  65 

8  39 

6  03 

6  03 

Year 

2.36 

1.74 

1  75 

3  89 

9  24 

6  03 

RELATIVE   PRICES. 


January  

194 

93 

76 

147 

474 

300 

February 

127 

93 

76 

168 

481 

300 

March  

121 

96 

76 

173 

481 

300 

April 

109 

94 

76 

122 

•   370 

300 

May  

107 

89 

76 

116 

390 

300 

June 

106 

88 

78 

125 

06! 

300 

July  .... 

123 

88 

82 

137 

638 

300 

August 

125 

86 

78 

140 

677 

300 

September  

115 

83 

81 

147 

555 

300 

October 

105 

80 

102 

149 

299 

300 

November  

92 

76 

115 

344 

300 

300 

December 

88 

75 

132 

418 

300 

300 

Year 

118 

87 

87 

I'M) 

460 

300 

(7)  THE  CONTROL  OVER  CHARCOAL. 

The  Fuel  Administrator  did  not  bring  charcoal  under  formal  price 
control  until  the  middle  of  191 8. l  Maximum  prices  were  then  fixed 
for  charcoal  f .  o.  b.  cars  at  the  point  of  shipment  as  follows : 

Cents. 

Lump  in  bulk,  per  bushel  (20  pounds) 20 

Lump  in  bags,  per  bushel  (20  pounds) 22 

Screening  in  bags,  per  bushel   (20  pounds) - 20 

A  reasonable  charge,  subject  to  the  approval  of  the  Fuel  Admin- 
istration, was  allowed  for  handling  and  delivery  where  wagon  de- 
liveries were  made  from  the  producer  to  the  purchaser. 

(8)   CONTROL  OVER  FUEL  WOOD. 

It  is  of  interest  that  the  Fuel  Administration  on  October  29,  1918, 
authorized  the  Federal  fuel  administrators  in  the  various  States  to 
establish  such  reasonable  regulations  as  to  the  length  of  rail  ship- 
ments of  fuel  wood  cut  within  the  State  as  they  deemed  necessary, 
and  to  stipulate  the  conditions  of  such  shipments. 


9. 


GOVERNMENT   CONTROL   OVER   PRICES. 


191 


(9)   THE  CONTROL  OVER  PETROLEUM. 
THE  EARLY  WAR  SITUATION. 

The  tremendous  demands  for  petroleum  and  its  products  during 
the  past  decade  brought  the  industry  by  1915  to  face  a  consumption 
demand  which  surpassed  the  annual  domestic  output.  Indeed,  for 
more  than  a  year  prior  to  the  declaration  of  war  by  the  United  States 
we  had  been  drawing  upon  reserve  stocks  and  imports  from  Mexico 
in  order  to  supply  our  needs.1  The  war,  of  course,  both  through  the 
acceleration  of  industries  and  the  large  military  consumption,  in- 
creased the  demand  for  petroleum  products  of  all  kinds.  Moreover, 
the  acute  coal  shortage  and  the  transportation  congestion  of  the 
winter  of  1917-18  encouraged  the  substitution  of  fuel  oil  for  other 
kinds  of  fuel.  The  demand  for  fuel  oil,  as  might  be  expected,  in- 
creased until  a  shortage  developed  and  prices  soared.  Fuel  oil, 
Avhich  had  previously  been  of  secondary  importance  in  the  refining 
of  petroleum,  took  the  lead  among  the  various  products. 

THE  REGULATION  OF  PRICES. 

The  rise  in  the  price  of  fuel  oil  wTas  naturally  reflected  in  the  price 
of  crude  petroleum,  and  market  quotations  for  the  latter  soon  reached 
a  level  100  per  cent  higher  than  the  prewar  average.2  (See  chart  on 
p.  195.)  It  soon  became  apparent,  both  to  the  petroleum  industry 
and  the  various  governmental  agencies,  that  something  would  have 
to  be  done  toward  stabilizing  prices.  Several  suggestions  were  made 
relative  to  governmental  intervention.  The  opinion  of  the  trade 
was  that  the  "  price  of  petroleum  products  be  fixed  in  the  same  way 

1  A  review  of  the  petroleum  situation  in  the  United  States  immediately   prior  to  our 
entrance    into    the    war    is    presented    at    length    in    Bulletin    30    of    the    present    series, 
"  Prices  of  Petroleum  and  Its  Products,"  by  Joseph  E.  Pogue,  assisted  by  Isador  Lubin. 
(W.  I.  B.  Price  Bulletin  No.  36.) 

2  The  following  data  present  the  course  of  the  fuel  oil  and  crude  petroleum  prices  for 
the  (5  years  1913  to  1918.     Fuel  oil  spot  quotations  are  not  as  representative  of  typical 
conditions  as  might  be  desirable,  since  the  greater  part  of  our  supply  is  sold  under  con- 
tract.    Tables  of  actual  and  relative  realizations  at  a   centrally   located  refinery,   there- 
fore,  are   appended   in  order  that  the  reader   may  obtain   a   truer   picture  of  the  price 
situation. 

ACTUAL  REALIZED  PRICES  OF  FUEL  OIL  JANUARY,  1913-DECEMBER,  1918. 

[Per  barrel.] 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January  . 

$2  15 

$1  90 

$1  55 

$3  26 

S3  74 

9  A    7C 

February  .  .  . 

2.  15 

90 

1  50 

3  26 

3  gg 

4  76 

March..l  

2  15 

90 

1  50 

3  26 

3  98 

4  76 

April... 

2  15 

67 

1  50 

3  02 

q  qa 

c   oc 

Mav  

2  15 

55 

1  50 

2  79 

3  45 

*>  36 

June  

1  67 

55 

1  50 

2  79 

3  45 

C    OC 

July.... 

1  67 

55 

1  50 

2  79 

o  4  = 

August  

1  67 

67 

1  96 

2  30 

3.  93 

5  36 

September  

1.67 

.67 

2  20 

2  30 

3  93 

5  36 

October  ,.. 

1  67 

55 

2  31 

2  30 

3  93 

5  36 

November  

1  67 

55 

2  79 

2  30 

3  93 

c  oc 

December  

1.90 

55 

3  26 

3  26 

3  93 

5  36 

Footnote  continued  on  page  192. 


192 


HISTORY   OF   PEICES   DURING   THE   WAR. 


that  iron  and  steel  prices  were  fixed."  *  It  was  not  until  August  18, 
however,  that  any  definite  action  was  taken  in  the  matter,  and  on 
that  date  the  plan  (1)  to  stabilize  the  price  paid  for  crude  oil;  (2) 
to  maintain  the  continued  and  uninterrupted  flow  of  crude  oil  in  its 
present  channels  in  so  far  as  is  practicable  and  just  to  the  interests 
involved  through  the  voluntary  action  and  cooperation  of  the  indus- 
try itself  was  inaugurated.  This  system  of  voluntary  price  fixing 
was  nothing  more  than  a  voluntary  agreement  made  by  the  trade 
whereby  the  prevailing  market  prices  were  to  be  continued  without 
increase,  and  premiums  were  to  be  limited  to  certain  fixed  maxima.2 
The  amount  allowed  for  premiums  varied  from  10  cents  per  barrel 
of  crude  oil  in  the  Appalachian  districts  to  $1.50  for  certain  parts  of 
the  Mid-Continent. 

Footnote  continued  from  page  191. 

RELATIVE  REALIZED  PRICES  OF  FUEL  OIL  JANUARY,  1913-DECEMBER,  1918. 


Month.    • 

1913 

1914 

1915 

1916 

1917 

1918 

January  . 

125 

110 

90 

189 

217 

276 

February  

125 

110 

87 

189 

231 

276 

March... 

125 

110 

87 

189 

231 

276 

\pril 

195 

97 

87 

175 

231 

311 

May.... 

125 

90 

87 

162 

200 

311 

June  .  . 

97 

90 

87 

162 

200 

311 

July  ... 

97 

90 

87 

162 

200 

311 

Aueust... 

97 

97 

114 

133 

228 

311 

September  

97 

97 

127 

133 

228 

311 

October 

97 

% 

134 

133 

228 

311 

November  

97 

90 

'     162 

133 

228 

311 

December. 

110 

90 

189 

189 

228 

311 

1  The  solution  of  the  problems  relating  to  petroleum  was  centered  in  the  hands  of  'the 
Oil  Division  of  the  Fuel  Administration,  which  was  established  on   Jan.   10,   1918,  with 
Mr.  M.  L.  Requa  as  general  director.     From  the  very  beginning  he  placed  considerable  em- 
phasis upon  the  price  situation.     Through  his  efforts  the  problem  of  petroleum  prices  was 
settled  with  a  minimum  of  administrative  interference.     On  Apr.   25,  he  approached  the 
War  Industries  Board  with  the  request  that  action  be  taken  along  the  lines  adopted  for 
other  essential  commodities.     The  attitude  of  the  petroleum  industry  toward  this  matter 
is  madft  evident  in  the  following  extract  from  Mr.  Requa's  letter  to  Mr.  Baruch  : 

"  The  petroleum  war  service  commitee,  as  a  result  of  an  extended  conference  with  me 
on  the  subject  of  prices,  have  requested  that  prices  of  petroleum  products  be  fixed  in 
the  same  way  that  steel  prices  were  fixed.  If  this  be  done,  it  will  greatly  simplify  the 
matter  of  allocation  of  purchases." 

No  action,  however,  was  taken  by  the  War  Industries  Board  at  this  time.  Again  on 
July  15,  the  price-fixing  committee  was  asked  to  fix  the  price  of  fuel  oil,  especially  for 
Navy  purchases,  but,  this  request  also  was  followed  by  no  action,  since  it  was  the  opinion 
of  the  committee  that  adequate  power  to  regulate  prices  of  fuels  lay  in  the  hands  of  the 
Fuel  Administration. 

2  Many  small  refiners  are  in  the  habit  of  paying  certain  premiums  above  posted  market 
prices  of  crude  petroleum  in  order  that  they  may  obtain  sufficient  supplies.     Mr.  Requa 
in   approving   the  plan   referred   to   these   premiums    and   their   relation    to  the   price   of 
petroleum  products  as  follows : 

"  I  want  first  to  say  that  it  is  the  understanding  of  this  department  that  the  pre- 
miums mentioned  are  to  be  maximum  and  are  not  to  be  paid  unless  absolutely  necessary; 
are  not  to  be  used  in  justification  for  a  demand  for  increased  prices  for  refined 
products  and  that  prices  above  existing  posted  prices,  if  justified  at.  all,  can  only  be 
BO  upon  the  score  of  existing  trade  practices'  making  such  premiums  necessary  to  permit 
the  small  purchaser  to  secure  his  crude.  If  Government  control  and  direction  finally 
follow  as  a  national  need,  premiums,  I  believe,  will  be  entirely  wiped  out,  as  present 
posted  prices  are  in  themselves  ample  to  stimulate  and  encourage  production." 

Moreover,  the  industry  was  given  to  understand  that  should  the  occasion  arise  for  any 
readjustments  in  the  prices  of  petroleum  products,  adequate  proof  of  such  necessity  would 
have  to  be  furnished.  Mr.  Requa  goes  on  to  say  : 

"  Broadly  speaking,  it  is  the  hope  of  the  Fuel  Administration  Oil  Division  that 
further  advances  in  finished  products  will  not  be  necessary  ;  but  should  it  prove  4;hat 


GOVEE^MENT   CONTROL   OVER  PRICES.  193 

The  administration  of  this  agreement  was  left  entirely  in  the 
hands  of  the  trade  and  through  a  series  of  local  and  national  com- 
mittees all  points  of  issue  were  settled.  Appeal  to  Washington 
was  made  "  only  as  the  last  resort  after  all  means  of  settlement  had 
been  exhausted." 1  The  established  prices  were  to  affect  all  contracts 
existing  on  August  8  which  had  been  entered  into  after  May  17, 
1918,  and  were  to  be  in  force  until  November  1,  1918,  when  they  were 
further  extended  to  December  16.2 

THE  LICENSING  OF  THE  PETROLEUM  INDUSTBY. 

On  January  31,  1918,  a  presidential  proclamation  required  the 
licensing  of  "all  firms,  corporations,  and  associations  engaged  in  the 
business  of  both  manufacturing  and  distributing  fuel  oil"  whose  gross 
sales  were  more  than  100,000  barrels  per  year.  The  purpose  of  such 
licensing  appears  to  have  been  the  regulation  of  the  distribution  of 
fuel  oil  in  order  that  various  essential  consumers  such  as  the  Rail- 
road Administration,  the  Shipping  Board,  and  the  war  agencies 
might  have  sufficient  supplies  to  meet  their  needs.3  A  system  of  de- 
livery priorities  was  inaugurated  and  distributors  w^re  forbidden  to 
deliver  fuel  oil  to  any  customer  in  any  class  before  fulfilling  the  de- 
mands of  customers  in  those  classes  which  had  prior  rating. 

In  September  the  need  for  still  further  control  of  the  petroleum 
industry  led  to  the  licensing  of  virtually  all  members  of  the  trade 
with  the  exception  of  those  retailers  whose  sales  were  below  $100.000. 
Whereas  formerly  only  dealers  and  producers  of  fuel  oil  were  un- 
der direct  control,  now  all  importers,  manufacturers,  distributors, 
marketers,  and  transporters  of  petroleum  and  its  products  were 
placed  under  license.  Licensees  were  not  allowed  to  make  unjust 
profits  or  commissions  and  were  limited  even  in  the  storage  rates 
they  could  charge.  Resales  and  the  cornering  of  supplies  were  for- 
bidden. Regulations  as  to  methods  of  manufacturing  gasoline 
were  also  put  in  force,  so  that  the  Army  and  Navy  might  have  suf- 
ficient supplies  of  the  type  necessary  for  their  operations;  and  cer- 
tain refiners  were  compelled  to  produce  a  specified  proportion  of 
their  gasoline  in  accordance  with  Army  and  Navy  specifications. 

this  is  not  the  case  it  means  that  such  proof  must  be  carefully,  completely,  and  accurately 
made  and  presented  to  this  department  before  any  acquiescence  or  approval  can  be 
expected. 

1  See  letter  of  Mr.  Requa  to  Mr.  A.  C.  Bedford  of  the  national  petroleum  war  service 
committee  Aug.  8,  1918. 

2 The  prices  fixed  in  the  respective  fields  were:  Pennsylvania,  $4;  Illinois,  $2.32; 
Mid-Continent,  $2.25  ;  Gulf,  $1.35  ;  California,  $1.26.  The  price  for  the  Gulf  fields  was 
later  increased  by  Mr.  Requa  to  $1.80  and  a  10-cent  per  barrel  increase  was  allowed 
for  Illinois.  An  increase  was  also  allowed  in  the  late  summer  for  oils  mined  in  north 
Louisiana. 

3  Indeed,  the  order  of  the  Fuel  Administrator  establishing  the  rules  governing 
licensees  engaged  in  the  distribution  of  fuel  oil  specifically  states : 

"  These  rules  and  regulations  are  promulgated  *  *  *  for  the  purpose  of  assuring 
an  adequate  supply  and  equitable  distribution  of  fuel  oil  for  the  purposes  vitally  essential 
to  the  national  socurity  and  to  the  successful  prosecution  of  the  war." 

125547°— 20 18 


194 


HISTORY  OF  PRICES   DURING   THE   WAR. 


THE  GASOLINE  EMERGENCY. 

Even  licensing,  however,  did  not  meet  all  the  necessary  require- 
ments of  the  emergency.  Every  effort  had  been  made  toward  the 
production  and  marketing  of  more  crude  oil,  so  that  refiners  who 
had  been  compelled  constantly  to  increase  their  plants  might  be  as- 
sured adequate  supplies.  Yet  the  extended  use  of  motor  trucks, 
the  demands  of  our  submarine  chasers,  and  our  air  fleet  continued 
to  draw  more  and  more  upon  our  resources.  Our  gasoline  reserves 
were  being  depleted.  Talk  of  gasoline  allocation  for  essential  use 
became  rife,  and  conservation  data  were  distributed  far  and  wide. 
Finally,  beginning  September  1,  "  gasless  Sunday  "  was  inaugurated 
and  operators  of  gasoline-consuming  vehicles  east  of  the  Mississippi 
River  were  "requested"  to  refrain  from  using  gasoline  on  Sundays. 
In  addition  the  refinery  output  of  gasoline  was  restricted  as  far  as 
possible  to  essential  uses,  and  producers  under  the  license  regula- 
tions were  forbidden  to  make  deliveries  of  gasoline  to  any  cus- 
tomer until  all  orders  for  export  to  the  United  States  Army  or 
Navy  or  to  the  Allies  had  been  delivered.1 

CONTROL  AND  ITS  EFFECT  UPON  PRICES. 

The  signing  of  the  armistice,  followed  by  the  cancellation  of  Gov- 
ernment contracts,  put  an  almost  immediate  end  to  the  activities  of 
the  Oil  Division  of  the  Fuel  Administration  on  December  7.  On 
this  date  many  of  the  license  restrictions  were  removed  and  nine 
days  later  the  price  agreement  of  the  previous  summer  terminated. 
On  May  15,  1919,  all  restrictions  upon  the  petroleum  industry  were 
removed. 

The  leveling  effect  of  the  price  agreement  of  the  summer  of  1918 
is  prominently  brought  out  by  the  contrast  between  the  price  tend- 
encies of  both  crude  petroleum  and  its  most  important  products, 
gasoline  and  fuel  oil,  during  the  period  of  its  operation  and  beforo 
that  time.  Still  more  significant,  however,  is  the  comparison  between 
the  price  level  of  the  direct  petroleum  products  and  such  by-products 
as  paraffin  and  petrolatum. 

1  See  Fuel  Administration  order  governing  manufacturers  of  kerosene  and  gasoline, 
Oct.  30,  1918. 

The  above  regulations  and  "  requests "  were  no  doubt  instrumental  in  alleviating  a 
situation  which  had  become  exceedingly  acute,  as  is  evidenced  by  a  comparison  of  sup- 
plies on  hand  at  the  end  of  the  several  months  of  the  early  autumn  in  1917  and  1918. 
Stocks  were  consistently  smaller  in  1918  than  in  the  preceding  year  in  spite  of  in- 
creased production,  conservation  measures,  and  the  direction  of  distribution. 

STOCKS  OF  GASOLINE  HELD  IN  THE  UNITED  STATES. 


Date. 

1917 

1918 

Date. 

1917 

1918 

July  31 

Gallons. 
345  199  195 

Gallons. 
349  928  604 

Sept.  30 

Gallons. 
287.758,562 

Gallons. 
269,772.723 

Aug.  31  

298,548,699 

285,446,538 

Oct.  31  

320,203,770 

250,328,329 

4.  THE  WAR  INDUSTRIES  BOARD. 


L  OIL 

IN 

JANUARY   I©I3  "  DECEMBER  1910 

AVERAGE:  QUOTED' PRICES  juLYi9i3'~juNE.i9i4-ioo 


The  War  Industries  Board  was  the  industrial  pivot  about  which 
war-time  controls  turned.  From  an  idea,  and  then  a  committee 
within  the  Council  of  National  Defense,  it  grew  quickly  into  the 
most  powerful  arm  of  the  President  for  converting  the  industries 
into  war  uses.  It  was  the  meeting  point  of  the  war  machine  and 
industry.  It  at  once  cleared  requirements  for  the  Government  war 
agencies,  allocated  to  the  trade 
the  output  of  commodities 
required  immediately  or  in  the 
future,  assigned  priority  of 
production  and  delivery  to 
war  materials,  curtailed  non- 
essential  production,  conserved 
wasteful  production  by  vari- 
ous restrictions,  and  controlled 
prices.  The  ramifications  of 
these  controls,  within  the  Gov- 
ernment and  out,  make  them 
relate  intimately  to  prices. 
The  price  control  exercised  by 
the  board  proper,  or  that  ex- 
ercised by  the  price-fixing 
committee,  can  not  be  dis- 
cussed without  first  under- 
standing the  relations  of  these 
other  controls  over  industry. 

(i)  THE  DEVELOPMENT  OF  A 
CONTROL  OVER  WAR  IN- 
DUSTRIES. 


Relative  prices. — Petroleum,  5  fields ;  Fuel 
oil,  5  cities ;  Gasoline,  5  cities. — By 
months,  Januaty,  1913,  to  December,  1918. 
(Average  quoted  prices,  July,  1913,  to 
June,  1914=100.) 


The  growth  of  a  fuller  con- 
trol over  industries  was  a  more 
gradual  thing  than  would 
seem  from  an  examination  simply  of  the  finished  monument.  The 
Government,  though  educated  in  the  doings  of  Europe  for  the 
three  years  previous,  had  not  appreciated  that  it  too  might  enter 
the  combat,  and  had  not  yet  prepared  itself  when  war  came.  The 
Cabinet,  high  officials  of  the  Government,  and  lower  officials,  went 
into  all-day  and  evening  conferences,  inside  the  Government  and 

195 


196  HISTORY   OF   PRICES   DURING  THE   WAR. 

out,  to  learn  their  problem  and  solve  it.  There  was  no  conviction, 
aside  from  the  need  for  soldiers  and  ammunition,  that  pressed 
more  insistently  upon  the  Government  than  the  need  for  some 
form  of  control  over  industry.  The  gradual  evolution  of  the  ma- 
chinery of  war-time  industrial  control  was  one  of  the  greatest  of 
the  nonmilitary  developments  within  the  Government.  A  full 
story  of  the  rise  of  the  War  Industries  Board,  which  was  the  center 
of  that  control,  falls  into  three  separate  parts:  (1)  The  early  work 
of  the  general  munitions  board,  the  committee  on  supplies,  and  the 
committee  on  raw  "materials,  minerals  and  metals  within  the  Council 
of  National  Defense;  (2)  the  creation  of  the  War  Industries  Board 
within  the  Council  of  National  Defense  on  July  28,  1917;  (3)  and, 
finally,  the  creation  of  the  War  Industries  Board  as  an  independent 
organization  under  the  Overman  Act  on  May  28,  1918. 

THE  EARLY  WORK  OF  THE  COUNCIL  or  NATIONAL  DEFENSE. 

A  comprehension  of  how  the  War  Industries  Board  came  into  its 
control  over  industry  can  not  be  had  without  tracing  its  earlier 
growth  from  a  mere  committee  of  the  Council  of  National  Defense 
to  an  independent  board.  The  Council  of  National  Defense  was  con- 
ceived, and  later  authorized  under  the  Army  appropriation  bill  of 
August  29,  1916,  simply  as  a  peace-time  body  to  work  broadly  upon 
preparedness  for  war.  The  act  itself  declared  it  to  be  established 
"  for  the  coordination  of  industries  and  resources  for  the  national 
security  and  welfare,"  and  made  it  the  duty  of  the  Council  of  Na- 
tional Defense  "to  supervise  and  direct  investigations  and  make 
recommendations  to  the  President  and  the  heads  of  executive  de- 
partments as  to  the  location  of  railroads  with  reference  to  the 
frontier  of  the  United  States  so  as  to  render  possible  expeditious 
concentration  of  troops  and  supplies  to  points  of  defense ;  the  coordi- 
nation of  military,  industrial,  and  commercial  purposes  in  the  loca- 
tion of  extensive  highways  and  branch  lines  of  railroad ;  the  utiliza- 
tion of  waterways ;  the  mobilization  of  military  and  naval  resources 
for  defense;  the  increase  of  domestic  production  of  articles  and  ma- 
terials essential  to  the  support  of  armies  and  of  the  people  during 
the  interruption  of  foreign  commerce;  the  development  of  seagoing 
transportation;  data  as  to  amounts,  location,  method  and  means  of 
production,  and  availability  of  military  supplies;  the  giving  of  in- 
formation to  producers  and  manufacturers  as  to  the  class  of  supplies 
needed  by  the  military  and  other  services  of  the  Government,  the 
requirements  relating  thereto,  and  the  creation  of  relations  which 
will  render  possible  in  time  of  need  the  immediate  concentration  and 
utilization  of  the  resources  of  the  Nation." 


GOVERNMENT   CONTROL   OVER   PRICES.  197 

The  Council  of  National  Defense  (consisting  of  the  Secretary  of 
War,  the  Secretary  of  the  Navy,  the  Secretary  of  the  Interior,  the 
Secretary  of  Agriculture,  the  Secretary  of  Commerce,  and  the  Secre- 
tary of  Labor)  and  its  advisory  commission1  had  only  the  above 
general  powers,  as  a  basis  in  law.  for  the  structure  of  control  which 
it  later  built.2 

Our  determination  to  enter  upon  war  caught  the  country,  except 
for  the  paper-organized  Council  of  National  Defense,  quite  without 
a  Government  organism  to  assume  contiol  over  its  industries.  The 
need  for  an  organized  industrial  fabric,  moreover,  was  then  our 
paramount  one.  The  Allies  needed  our  munitions,  metals,  foods,  and 
manufactures  more  immediately  than  they  needed  our  men.  The 
Council  of  National  Defense,  thus  long  before  authorized  as  a  peace-  w_ 
time  body,  was  formally  organized  on  March  X  1917,  and  was  seized  ,* 
upon  as  the  best  available  organ  for  the  control  of  industry.  The  -^ 
council,  which  represented  virtually  the  President's  Cabinet,  with'* 
the  Secretary  of  War  acting  as  chairman,  and  the  advisory  commis- 
sion met  several  times  each  week  during  the  spring  after  our  en- 
trance into  war  and  planned  how  best  to  meet  the  war  emergencies. 
A  surprising  number  of  the  more  important  war  agencies  grew  out 
of  their  early  plans  and  their  early  committees.  The  Council  of 
National  Defense  made  the  initial  survey  of  the  food  problem  which 
developed  into  the  formation  of  a  Food  Administration;  it  created 
the  Aircraft  Production  Board  which  later  became  separate ;  it  cre- 
ated an  important  committee  on  coal  production  which  later  went 
into  the  Fuel  Administration ;  it  established  the  commercial  economy 
board ;  and  the  munitions  standards  board.  But  the  three  most  im- 
portant committees  which  grew  up  under  the  newly  organized  Coun- 
cil of  National  Defense,  and  those  which  relate  peculiarly  to  later 
price  control,  were  the  general  munitions  board,  the  committee  on 
supplies,  apd  the  committee  on  raw  materials,  minerals  and  metals. 

The  general  munitions  board. — The  general  munitions  board,  cre- 
ated on  March  31,  1917,  and  going  for  several  days  under  the  name 
of  the  purchasing  commission,  began  three  days  after  we  entered  the 
war  to  coordinate  purchases  for  the  Army  and  Navy,  to  assist  them 
in  the  procurement  of  raw  materials,  and  to  assign  to  war  orders 
priorities  as  between  the  Government  departments  and  between  the 
Government  and  industry.  Since  the  board  was  destined  ultimately 

1  The  Council  of  National  Defense,  by  authority  of  the  statute,  appointed  an  advisory 
commission  of  7  members  who  administered  the  work  of  the  council,  as  follows  :  Daniel 
Willard    (chairman),   transportation   and   communications;    Howard   E.    Coffin,   munitions 
and    manufacturing ;    Julius    Rosenwald,    supplies ;    Bernard    M.    Baruch,    raw    materials, 
minerals,  and  metals;  Hollis  Godfrey,  engineering  and  education;  Samuel  Gompers,  labor: 
Franklin  Martin,  medicine  and  surgery. 

2  See  section  2  of  H.  R.   37498,  known   as  the  Army   appropriation   act. 


198  HISTOKY   OF   PRICES   DURING   THE   WAR. 

to  grow  into  the  War  Industries  Board,  it  is  of  peculiar  interest  to 
note  the  resolution  by  the  Council  of  National  Defense  creating  the 
general  munitions  board : 

Such  committee  shall  have  no  authority  at  this  time  to  issue  purchase  orders, 
make  contracts  or  bind  the  Government  in  its  purchases;  all  these  things  to 
be  done,  as  at  present,  by  the  respective  departments.  The  chairman  of  the 
committee,  however,  shall  have  authority  to  require,  when  necessary,  that  cer- 
tain (conflicting)  purchases  be  not  made  until  the  same,  with  a  full  statement 

of  the  facts,  have  been  submitted  to  the  Secretaries  of  the  War  and  Navy.1 

• 

The  general  munitions  board,  moreover,  at  its  initial  meeting  con- 
ceived as  its  purpose — 

to  assume  the  prompt  equipping  and  arming  with  the  least  possible  disadjust- 
ment of  normal  industrial  conditions,  of  whatever  forces  may  be  called  into  the 
service  of  the  country.  The  immediate  efforts  of  the  board  will  be  directed  on 
lines  calculated  to  coordinate  the  making  of  purchases  by  the  Army  and  Navy ; 
to  assist  in  the  acquirement  of  raw  materials  and  of  manufacturing  facilities ; 
and  to  establish  the  precedence  of  orders  between  the  departments  of  War 
and  of  the  Navy  and  between  the  military  and  industrial  needs  of  the  country.3 

A  perusal  of  the  original  minutes  of  the  general  munitions  board 
shows  that  the  board,  despite  its  assigned  narrower  task,  became 
peculiarly  concerned  with  prices  and  their  informal  control.  The 
board  attacked,  and  virtually  eliminated,  competitive  bidding  by  the 
Army  and  Navy  for  the  same  materials.  It  developed  policies  for 
the  procurement  of  commodities  required  by  war  agents.  It  recog- 
nized from  the  outset  that  the  Government,  if  it  procured  the  esti- 
mated requirements,  was  confronted  with  the  necessity  of  cutting 
down  some  and  directing  much  of  the  industrial  output,  clearing 
all  Government  requirements  over  one  table,  and  assigning  priority 
of  production  and  delivery  to  war  materials.  It  helped  to  develop 
sources  for  rifles  and  other  small  arms,  machine  guns,  ordnance, 
ammunition,  gun  forgings,  carriages,  limbers,  caissons,  forge  wagons, 
military  vehicles,  steel  helmets,  armor-piercing  shells,  surgical  sup- 
plies, optical  glass  and  gauges,  tools,  and  dies.  Especial  progress 
was  made  toward  the  production  of  the  estimated  requirements  (gun 
forgings,  small  arms,  ammunition,  lumber  for  Army  vehicles,  and 
machine  guns)  of  the  Army  and  Navy.  The  real  beginnings  of  the 
price-control  problem  came  with  the  purchase  of  these  materials, 
when  the  general  munitions  board  advised  the  military  departments 
how  to  determine  prices  and  itself  considered  whether  prices  should 
be  made  a  flat  rate  to  the  Government,  or  based  upon  cost  plus  a 
percentage  of  profit. 

1  The  general  munitions  board  began  work  on  Apr.  9,  1917,  under  the  chairmanship  of 
Frank  A.  Scott,  and  by  June  30  was  composed  of  17  representatives  from  the  War  and 
Navy  Departments  and  6  other  civilians. 

2  See  minutes  of  general  munitions  board  for  Apr.  9,  1917. 


GOVERNMENT   CONTROL   OVER   PRICES.  199 

No  doubt  the  first  important  recognition,  or  grant  of  authority, 
which  enabled  the  general  munitions  board  to  influence  prices  was 
that  given  on  April  17, 1917,  by  the  Secretary  of  War,  then  chairman 
of  the  Council  of  National  Defense : 

The  general  munitions  board,  having  been  appointed  by  the  Council  of 
National  Defense,  and  having  been  called  upon  to  perform,  among  other  duties, 
that  of  determining  what  are  fair  and  just  prices  to  be  paid  by  the  Government 
for  munitions  and  related  supplies,  I  authorize  the  general  munitions  board 
to  act  on  questions  involving  the  determination  of  fair  and  just  prices  for 
munitions  and  related  supplies,  when  called  to  do  so  by  a  Department  head.1 

This  edict  gave  the  munitions  board,  in  so  far  as  it  could  win  coop- 
eration from  any  Government  department,  a  free  hand  to  determine 
upon  and  recommend  "  fair  and  just "  prices  for  war  materials. 

An  inquiry,  at  a  very  early  date,  was  made  by  the  general  muni- 
tions board  into  the  more  technical  questions  of  how  to  determine 
"  fair  and  just "  prices  and  what  understanding  was  to  be  made 
with  the  trade,  pending  that  determination  for  purchases  needed 
immediately.  The  board  after  a  time,  concluded  that  where  a  flat 
rate  could  not  be  agreed  upon  a  cost  plus  percentage  basis  'should  be 
followed.2  It  frequently  happened  that  certain  purchases  were  re- 
quired so  promptly  that  deliveries  were  delayed  awaiting  the  de- 
termination of  a  fair  price.  The  board,  in  order  to  hasten  deliveries, 
was  authorized  in  such  cases  to  assure  the  manufacturers  a  price  of 
actual  cost  plus  10  per  cent  of  profit.3  That  general  practice  was 
often  followed,  in  a  modified  form,  in  the  later  price  fixing. 

1  Minutes  of  general  munitions  board  for  Apr.  17,  1917. 

2  The  general  munitions  board,  after  hearing  the  report  of  its  price  committee,  adopted 
the  following  policy  on  Apr.  25,  1917  : 

That  whenever  experience  or  public  or  competitive  quotations  make  it  possible  for 
the  department  to  be  assured  of  the  reasonableness  of  the  price,  a  straight  price  method 
is  to  be  preferred.  * 

In  cases  where  a  flat  price  can  not  be  agreed  upon,  it  is  suggested  that  a  cost  plus 
percentage  basis  be  followed  ;  the  method  of  figuring  cost  to  be  the  one  laid  down  in  the 
present  law  providing  for  the  payment  of  a  munitions  tax. 

In  cases  where  it  is  desirable  to  use  the  cost  plus  percentage  basis,  but  where  the 
Government  and  contractor  are  already  aware  of  a  fair  Average  cost  for  producing  the 
article  the  method  might  be  cost  plus  percentage,  providing  that  if  the  cost  falls  below 
the  average  amount  prescribed,  the  contractor  shall  receive  half  of  the  saving.  If  the 
cost  passes  above  the  amount  prescribed,  half  the  excess  will  be  deducted  from  the 
contractor's  percentage  of  profit. 

3  The  minutes  of  the  general   munitions  board   for  May   5,    1917.   show   the  following 
resolution  made  then  a  policy  by  the  board  : 

"  Resolved,  That  where  prices  of  material,  machinery,  manufactured  articles,  etc., 
named  by  the  manufacturers  are  in  excess  of  those  recently  paid  for  similar  material, 
and  prompt  action  is  necessary  to  prevent  delay  in  actual  work  of  manufacture,  the 
orders  for  such  material  may  be  placed  immediately  with  such  manufacturers  and  the 
actual  prices  to  be  paid  settled  after  further  investigation,  provided  that  the  manu- 
facturer is  assured  of  a  price  of  actual  cost  plus  10  per  cent  after  submitting  com- 
plete and  satisfactory  data  as  to  items  controlling  increase  in  cost  and  an  affidavit  as 
to  accuracy  of  data." 


200  HISTORY   OF   PRICES   DURING   THE   WAR. 

Another  important  step  toward  the  final  plan  of  price  control 
was  the  authorization  given  by  the  munitions  board  for  its  sub- 
committee (on  prices)  to  "  fix  specific  prices  "  in  cases  of  emergency. 
The  writing  of  that  informal  power  into  its  minute  book,  though 
without  any  authority  in  statute,  was  a  leap  peculiarly  significant 
as  paving  the  way  to  future  control.  This  resolution  of  the  general 
munitions  board,  adopted  May  1,  1917,  says: 

That  all  questions  regarding  prices  be  laid  before  a  general  meeting  of  the 
board,  except  in  cases  where  specific  power  is  delegated  by  the  board.  How- 
ever, in  case  of  emergency  the  chairman  shall  be,  and  he  is  hereby,  empowered 
to  appoint  a  committee  to  fix  specific  prices. 

The  more  or  less  formal  records  of  the  general  munitions  board, 
quite  apart  from  the  many  unwritten  tales  that  are  passed  from  ear 
to  ear,  show  clearly  that  the  beginnings  of  price  control  date  back 
not  only  before  the  creation  of  the  price-fixing  committee  but  be- 
fore the  creation  of  the  War  Industries  Board.  The  general  muni- 
tions board,  created  by  the  Council  of  National  Defense  on  March 
jH,  1917, "for  the  purpose  of  coordinating  war  purchases,  of  its  own 
initiative  concerned  itself  with  prices.  It,  without  the  authority  of 
a  statute,  studied  how  prices  ought  to  be  controlled  and,  more  and 
more,  assumed  an  informal  control  over  them.  The  policies  then 
elaborated  comprehend  to  a  surprising  degree  the  essentials  of  the 
later  price  control. 

The  committee  on  supplies. — The  Council  of  National  Defense, 
two  months  before  we  declared  war,  created  a  committee  on  supplies 
to  advise  with  the  purchasing  officers  of  the  War  and  Navy  Depart- 
ments and  to  help  them  coordinate  their  requirements  for  clothing, 
equipment,  and  subsistence. 

This  committee,  one  of  the  first  seriously  to  give  its  attention  to 
the  question  of  stabilizing  prices,  was  the  first  to  ask  the  Secre- 
tary of  War  to  abandon  the  peace-time  Army  and  Navy  practice 
of  advertising  for  bids.  It  believed  that  advertisements  for  enor- 
mous quantities  of  staples  would  disturb  industrj^  and  stimulate  the 
inflation  of  prices.  This  change  effected,  the  Government  was  en- 
abled to  go  over  the  heads  of  the  middlemen  directly  to  the  manu- 
facturers for  its  purchases.  In  the  past,  when  these  middlemen  heard 
of  proposed  Government  purchases,  they  commonly  secured  options 
in  advance  upon  such  supplies  and  then  quoted  them  to  the  Govern- 
ment at  increased  prices. 

The  committee  on  supplies  organized  various  subcommittees  from 
every  trade  (notably  cotton  goods,  woolen  goods,  knit  goods,  shoes, 
leather  equipment,  and  canned  goods),  which  later  were  made  into 
commodity  sections  and  assisted  materially  in  the  turning  of  manu- 
facturing plants  into  Government  uses. 


GOVERNMENT    CONTROL   OVER   PRICES.  201 

The  committee,  in  a  word,  concerned  itself  primarily  with  com- 
modities difficult  to  secure  because .  of  the  excessive  requirements 
of  the  Government,  shortage  of  raw  material  involved  in  their 
manufacture,  or  of  the  competition  for  civilian  uses.  It  opened  a 
way  to  later  price  control,  in  a  sense,  by  its  experience  at  securing 
options,  the  "  pegging "  of  prices  by  various  informal  methods,  the 
allocation  of  requirements  to  the  industry,  and  by  the  reduction  of 
competition  between  Government  departments  for  the  same  goods.1 

The  committee  on  raw  materials,  minerals,  and  metals. — The  com- 
mittee on  raw  materials,  minerals,  and  metals  under  the  direction 
of  Bernard  M.  Baruch,  which  was  the  nucleus  about  which  the  com- 
modity sections  of  the  War  Industries  Board  later  grew,  was  created 
to  survey  the  supply  of  raw  materials  available  for  our  own  and 
allied  uses.  The  European  war  needs,  prior  to  our  entrance  into 
war,  had^exTiausted  many  of  our  surplus  stocks  and  our  prewar  busi- 
ness contracts  had  tied  up  immense  quantities  of  the  remaining 
stocks.  Those  limitations,  coupled  with  the  reduction  in  shipping 
space  for  imports,  made  the  problem  before  the  Baruch  committee 
one  of  the  most  pressing  of  that  time. 

It  soon  became  apparent  to  the  committee  on  raw  materials,  min- 
erals, and  metals,  after  several  initial  inquiries,2  that  the  satisfac- 
tion of  all  Government  and  allied  commodity  needs  would  require 
a  thorough-going  organization  of  industry.  Mr.  Baruch,  himself  a 
man  of  business  viewpoint,  put  supreme  confidence  in  widely  re- 
spected business  men  and  organized  a  series  of  cooperative  com- 
mittees under  their  leadership.  It  was  largely  through  these  early 
contacts  with  the  trade  that  hf ,  and  his  committee,  were  able  to 
strike  agreements  for  the  placement  of  Government  orders  at  lower 
than  market  prices.  The  committee  gave  marked  impetus  to  the 
later  work  by  the  prompt  organization  of  commodity  committees  for 
the  alcohol,  aluminum,  anthracite  and  bituminous  coa'l,  asbestos, 
magnesia,  roofing,  brass,  cement,  chemicals,  copper,  lead,  lumber, 
mica,  nickel,  oil,  rubber,  steel,  and  steel  products,  and  zinc  indus- 
tries.3 The  chief  services,  perhaps,  of  these  commodity  committees 
as  a  working  part  of  the  raw  materials  committee,  were  their,  help, 
in  providing  trade  information  relative  to  supplies,  their  technical 
advice  pertaining  to  the  procurement  of  requirements,  and  their 
ability  to  hasten  deliveries. 
1 • 

1  These  data  are  taken  from  the  first  annual  report  of  the  Council  of  National  Defense 
for  the  year  ended  June  30,  1917. 

"  The  committee  studied  the  situation  relative  to  the  more-  important  import  articles 
such  as  nitrates,  pyrites,  rubber,  mica,  tin,  platinum,  and  palm  oil. 

3  Advisory  committees  were  also  appointed  to  cover  large  numbers  of  the  various  special 
constituent  fields,  as,  for  example,  in  respect  to  the  following  products :  Pig  iron,  iron 
ore,  tin  plate,  sheet  steel,  wire  rope,  malleable  castings,  ferroalloys,  tubular  products, 
cold-rolled  and  cold-drawn  steel,  pig  iron,  wire  products,  and  scrap  iron  and  steel. 


202  HISTORY   OF   PRICES   DURING   THE   WAR. 

The  foregoing  beginnings  of  industrial  control  form  a  background 
of  all  control  over  prices  later  exercised  by  the  War  Industries 
Board.  The  committee  on  raw  materials  early  recognized  the  need 
for  stabilization  of  the  market  and  for  the  purchase  of  Government 
requirements  at  reasonable  prices.  The  committee  itself,  for  example, 
as  early  as  March,  1917,  arranged  informally  for  the  purchase  of 
45,000,000  pounds  of  copper  at  16|  cents  at  a  time  when  the  prevailing 
market  price  was  35  cents.  Soon  afterwards  a  trade  agreement  was 
made  for  the  purchase  of  500,000  tons  of  steel  at  a  price  over  one- 
third  below  the  market  price;  and  large  purchases  of  zinc  and  lead 
were  also  bought  at  like  reductions.  The  committee,  through  the 
cooperative  subcommittee  on  lumber,  "  pegged  "  lumber  prices  below 
the  prevailing  market  and  effected  an  estimated  saving  to  the  Gov- 
ernment of  SlOjOOO^OO.1  These  and  other  similar  agreements  all,  it 
should  be  emphasized,  were  of  a  highly  informal  character.  But, 
as  such  perhaps,  they  served  the  more  to  impress  the  Government  and 
the  trade  with  a  confidence  in  prices  jointly  made.  That  belief, 
whether  for  better  or  worse,  played  a  leading  role  in  the  subsequent 
system  of  price  control. 

THE  WAE  INDUSTRIES  BOARD  CREATED  UNDER  THE  COUNCIL  ON  JULY  28,  1917. 

The  Council  of  National  Defense,  recognizing  shortly  the  need 
for  a  broader  control  over  industry,  created  the  War  Industries 
Board  on  July  28,  1917.  The  creation  of  the  new  board,  approved 
by  the  President,  emphasized  simply  the  urgency  for  more  control 
than  the  general  munitions  board,  the  committee  on  supplies,  and 
the  committee  on  raw  materials,  minerals  and  metals  had  been  ex- 
ercising. It,  therefore,  was  empowered  to  exercise  control  over  more 
industries  than  had  the  general  munitions  board  and  to  take  over 
bodily  the  whole  of  the  committee  on  supplies,  and  that  on  raw  ma- 
terials with  the  numerous  commodity  committees  under  it.2  In  these 
three  early  committees  of  the  Council  of  National  Defense  the  newly 
created  War  Industries  Board  had  its  nucleus. 

The  official  announcement  of  the  creation  of  the  War  Industries 
Board  declared  that  it  was  to  act  "  as  a  clearing  house  for  the 
war-industry  needs  of  the  Government,  determine  the  most  effective 
ways  of  meeting  them,  and  the  best  means  and  methods  of  increasing 
production,  including  the  creation  or  extension  of  industries  de- 
manded by  the  emergency,  the  sequence  and  relative  urgency  of  the 

1  These  data  are  set  "forth  in  the  first  annual   report  of  the  Council   of  National  De- 
fense, issu'ed  for  the  fiscal  year  ended  June  30,  1917. 

2  Mr.  Frank  A.  Scott,   who  had  been  chairman  of  the  general   munitions  board   of  the 
council,   was  retained  as  chairman  of  the  new  board.     The  chairmanship,   later   in  the 
fall,  was  given  to  Mr.  Daniel  Willard. 


GOVERNMENT   CONTROL   OVER   PRICES.  203 

needs  of  the  different  Government  services,  and  consider  price  fac- 
tors." The  board,  under  this  definition  of  powers,  after  taking  juris- 
diction over  the  work  of  the  various  advisory  committees  on  raw 
materials  and  supplies,  within  a  few  months  re-formed  those  com- 
mittees into  what  later  became  commodity  sections.1 

The  appointment  of  Chairman  Baruch'. — A  noteworthy  reorgani- 
zation of  the  internal  work  of  the  War  Industries  Board,  and  one 
which  went  far  toward  placing  it  upon  its  final  basis,  occurred  when 
the  President  asked  Mr.  Bernard  M.  Baruch  to  become  its  chairman 
on  March  4, 1918.  The  President  had  by  then  become  impressed  with 
the  need  for  even  a  more  far-reaching  control  over  industry  than 
the  law  specifically  provided  or  than  had  been  yet  exercised  by  the 
Council  of  National  Defense  or  the  7-month-old  War  Industries 
Board.  He,  therefore,  upon  the  apointment  of  Mr.  Baruch,  redefined 
the  functions  of  the  board  and  read  into  them  a  number  of  sweeping 
war  powers.  This  broad  survey  of  powers  to  be  exercised  made  Mr. 
Baruch  "  the  general  eye  of  all  supply  departments  in  the  field  of 
industry,"  responsible  to  anticipate  prospective  requirements  of  the 
Government  and  to  turn  the  full  capacity  of  the  country  to  their 
production.  It  made  his  board  responsible  to  create  new  facilities 
and  to  find  new  sources  of  supply;  to  advise  the  Government  pur- 

1  There  follows  a  statement  in  full  of  the  official  outline  of  the  powers  and  organi- 
zations of  the  War  Industries  Board  as  created  on  July  28,  1917  : 

The  board  will  act  as  a  clearing  house  for  the  war-industry  needs  of  the  Government, 
determine  the  most  effective  ways  of  meeting  them,  and  the  best  means  and  methods  of 
increasing  production,  including  the  creation  or  extension  of  industries  demanded  by  the 
emergency,  the  sequence  and  relative  urgency  of  the  needs  of  the  different  Government 
services,  and  consider  price  factors  and,  in  the  first  instance,  the  industrial  and  labor 
aspects  of  problems  involved  and  the  general  questions  affecting  the  purchase  of 
commodities. 

Of  this  board  Mr.  Baruch  will  give  his  attention  particularly  to  raw  materials,  Mr. 
Brookings  to  finished  products,  and  Mr.  Lovett  to  matters  of  priority.  These  three 
members,  in  association  with  Mr.  Hoover  so  far  as  foodstuffs  are  involved,  will  con- 
stitute a  commission  to  arrange  purchases  in  accordance  with  the  general  policies  formu- 
lated and  approved. 

The  Council  of  National  Defense  and  the  advisory  commission  will  continue  un- 
changed and  will  discharge  the  duties  imposed  upon  them  by  law.  The  committees  here- 
tofore created  immediately  subordinate  to  the  Council  of  National  Defense,  namely, 
labor,  transportation  and  communication,  shipping,  medicine  and  surgery,  women's  de- 
fense work,  cooperation  with  State  councils,  research  and  inventions,  engineering  and 
education,  commercial  economy,  administration  and  statistics,,  and  inland  transportation, 
will  continue  their  activities  under  the  direction  and  control  of  the  council.  Those  whose 
work  is  related  to  the  duties  of  the  War  Industries  Board  will  cooperate  with  it.  The 
subcommittees  advising  on  particular  industries  and  materials,  both  raw  and  finished, 
heretofore  created,  will  also  continue  in  existence  and  be  available  to  furnish  assistance 
to  the  War  Industries  Board.  The  purpose  of  this  action  is  to  expedite  the  work  of  the 
Government,  to  furnish  needed  assistance  to  the  departments  engaged  in  making  war 
purchases,  to  devolve  clearly  and  definitely  the  important  tasks  indicated  upon  represen- 
tatives of  the  Government  not  interested  in  commercial  and  industrial  activities  with 
which  they  will  be  called  upon  to  deal,  and  to  make  clear  that  there  is  total  disassocia- 
tion  of  the  industrial  committees  from  the  actual  arrangement  of  purchases  on  behalf 
of  the  Government.  It  will  lodge  responsibility  for  effective  action  as  definitely  as  is 
possible  under  existing  law.  It  does  not  minimize  or  dispense  with  the  splendid  service 
which  representatives  of  industry  and  labor  have  so  unselfishly  placed  at  the  disposal  of 
the  Government. 


204  HISTORY   OF   PRICES   DURING   THE    WAR. 

chasing  agents  relative  to  prices  that  ought  to  be  paid;  and  to  de- 
termine priorities  in  production  and  delivery.  It  is  of  especial  inter- 
est that  in  this  letter  the  President  asked  Mr.  Baruch,  as  chairman, 
to  be  governed  in  his  determination  of  prices  by  a  committee  sitting 
with  him,  and  consisting  of  members  of  the  board  charged  with  the 
study  of  raw  materials  and  manufactured  products,  the  labor  mem- 
bers of  the  board,  the  chairman  of  the  Federal  Trade  Commission, 
the  chairman  of  the  Tariff  Commission,  and  the  Fuel  Administrator.1 

1  There  follows  a  copy  in  full  of  the  letter  written  to  Mr.  Bernard  M.  Baruch  from 
the  White  House  on  Mar.  4,  1918,  and  redefining  the  work  to  be  done  by  the  War  In- 
dustries Board  under  his  chairmanship  : 

MY  DEAR  MR.  BARUCH  :  I  am  writing  to  ask  if  you  will  not  accept  appointment  as 
chairman  of  the  War  Industries  Board,  and  I  am  going  to  take  the  liberty  at  the  same 
time  of  outlining  the  functions,  the  constitution,  and  action  of  the  board  as  I  think  they 
should  now  be  established. 

The  functions  of  the  board  should  be: 

(1)  The   creation    of   new    facilities   and    the   disclosing,    if   necessary    the    opening  -up, 
of  new  or  additional  sources  of  supply  ; 

(2)  The  conversion  of  existing  facilities,  where  necessary,  to  new  uses  ; 

(3)  The  studious  conservation  of  resources  and  facilities  by  scientific,  commercial,  and 
industrial  economies ; 

(4)  Advice  to  the  several  purchasing  agencies  of  the  Government  with  regard  to  the 
prices  to  be  paid  ; 

(5)  The  determination,  wherever  necessary,  of  priorities  of  production  and  of  delivery 
and   of  the  proportions   of  any   given   agencies   when   the   supply   of   that   article   is    in- 
sufficient, either  temporarily  or  permanently ; 

(6)  The  making  of  purchases  for  the  Allies. 

The  board  should  be  constituted  as  at  present  and  should  retain  as  far  as  necessary 
and  so  far  as  consistent  with  the  character  and  purposes  of  the  reorganization,  its 
present  advisory  agencies,  but  the  ultimate  decision  of  all  questions,  except  the  de- 
termination of  prices,  should  rest  always  with  the  chairman,  the  other  members  acting 
in  a  cooperative  and  advisory  capacity.  The  further  organization  of  advice  I  will  in- 
dicate below.  • 

In  the  determination  of  priorities  or  production,  when  it  is  not  possible  to  have  the 
full  supply  of  any  article  that  is  needed  produced  at  once,  the  chairman  should  be 
assisted,  and  so  far  as  practicable  guided,  by  the  present  priorities  organization  or  its 
equivalent. 

In  the  determination  of  priorities  of  delivery,  when  they  must  be  determined,  he  should 
be  assisted  when  necessary,  in  addition  to  the  present  advisory  priorities  organization,  by 
the  advice  and  cooperation  of  a  committee  constituted  for  the  purpose  and  consisting 
of  official  representatives  of  the  Food  Administration,  the  Fuel  Administration,  the 
Railway  Administration,  the  Shipping  Board,  and  the  War  Trade  Board,  in  order  that 
when  a  priority  of  delivery  has  been  determined  there  may  be  common,  consistent,  and 
concerted  action  to  carry  it.  into  effect. 

In  the  determination  of  prices  the  chairman  should  be  governed  by  the  advice  of  a 
committee  consisting,  besides  himself,  of  the  members  of  the  board  immediately  charged 
with  the  study  of  raw  materials  and  of  manufactured  products,  of  the  labor  member 
of  the  board,  or  the  chairman  of  the  Federal  Trade  Commission,  the  chairman  of  the 
Tariff  Commission,  and  the  Fuel  Administrator. 

The  chairman  should  be  constantly  and  systematically  informed  of  all  contracts,  pur- 
chases, and  deliveries,  in  order  that  he  may  have  always  before  him  a  schematized  an- 
alysis of  the  progress  of  business  in  the  several  supply  divisions  of  the  Government  in  all 
departments. 

The  duties  of  the  chairman : 

(1)  To  act  for  the  joint  and  several  benefit  of  all  supply   departments  of  the  Gov- 
ernment ; 

(2)  To  let  alone  wfcat,  is  being  successfully   done   and   interfere   as   little  as   possible 
with  the  present  normal  processes  of  purchases  and  delivery  in  the  several  departments ; 

(3)  To   guide  and    assist  wherever   the   need   for   guidance  or   assistance   may   be   re- 


GOVERNMENT   CONTROL   OVER   PRICES.  205 

THE  WAR  INDUSTRIES  BOARD  MADE  INDEPENDENT  UNDER  THE  OVERMAN  ACT  ON 

MAY  28,  1918. 

A  still  further  independence  was  given  the  War  Industries  Board 
on  May  28.  1918,  when,  by  the  authority  of  the  Overman  Act,  the 
President  separated  the  board  from  the  Council  of  National  Defense. 
There  were,  it  appears,  no  additional  powers  over  industry  granted 
to  the  board  in  law  or  in  proclamation  by  virtue  of  its  new  inde- 
pendent status.  It  was  set  apart  from  the  Council  of  National  De- 
fense, and  given  its  independence,  by  an  Executive  order.  But  that 
order  did  not  itself,  nor  did  any  accompanying  proclamation,  set  up 
new  functions  or  powers.  The  order,  indeed,  specifically  referred  to 
the  previous  letter  written  to  Mr.  Baruch  on  March  4,  1918,  and  de- 
clared that  the  functions,  duties,  and  powers  of  the  War  Industries 
Board,  as  outlined  there,  "  shall  be  and  hereby  are  continued  in  full 
force  and  effect." 

(2)  THE  POWERS  AND  POLICIES   OF  THE  WAR  INDUSTRIES   BOARD. 

A  search  after  the  powers  and  policies  of  the  War  Industries  Board 
leads  to  such  a  dearth  of  material  that  it  is  curious  how  industry 
was  put  under  control  so  easily.  That  board,  though  charged  with 
the  control  of  all  industry  save  food  and  fuel,  had  a  more  doubtful 
statutory  basis  for  pushing  rigid  control  policies  than  any  other  war 
board.  It  had  fewer  specific  powers  in  law  than  either  of  the  boards 
responsible  for  controlling  simply  the  food  and  fuel  phases  of  in- 
dustry respectively.  But,  despite  all,  the  War  Industries  Board 
gradually  assumed  the  functions  of  coordinating  Government  pur- 
chases and  of  maintaining  a  widespread  and  effective  control  over 
industry.  It  is  of  interest  to  trace  the  basis  in  law  for  all  of  this 
war-time  control,  the  policy  of  control  which  Mr.  Baruch  sponsored, 
the  scheme  of  organization  he  administered,  and  finally,  the  relation 
which  the  work  of  the  board  itself  bore  to  the  regulation  of  prices. 

vealed ;    for  example,    in   the   allocation   of   contracts,    in    obtaining   access   to    materials 
in  any  way  preempted,  or  in  the  disclosure  of  sources  of  supply  ; 

(4)  To  determine  what  is  to  be  done  when  there  is  any  competitive  or  other  conflict  of 
interest  between  departments  in  the  matter  of  supplies ;  for  example,  when  there  is  not 
a  sufficient  immediate  supply  for  all  and  there  must  be  a  decision  as  to  priority  of  need  or 
delivery,  or  when  there  is  competition  for  the  same  sources  of  manufacture  or  supply,  or 
when   contracts   have  not  been   placed   in  such   a  way  as  to  get  advantage  of  the  full 
productive  capacity  of  the  country; 

(5)  To  see  that  contracts  and  deliveries  are  followed  up  where  such  assistance  as  is 
indicated  under  (3)  and  (4)  above  has  proved  necessary; 

(6)  To   anticipate   the   prospective   needs   of   the   several    supply    departments   of   the 
Government  and  their  feasible  adjustment  to  the  industry  of  the  country  as  far  in  ad- 
vance  as   possible,   in   order  that  as   definite   an   outlook    and    opportunity   for    planning 
as  possible  may  be  afforded  the  business  men  of  the  country. 

In  brief,  he  should  act  as  the  general  eye  of  all  supply  departments  in  the  field  of 
industry. 

Cordially  and  sincerely  yours, 

(Signed)  WOODROW  WILSON. 


206  HISTORY    OF   PRICES   DURING   THE   WAR. 

ITS  BASIS  IN  LAW. 

It  is  not  difficult  to  find  all  of  the  basic  powers  that  were  given 
to,  and  taken  by,  the  War  Industries  Board  to  authorize  its  controls. 
The  mandates  of  the  War  Industries  Board,  with  scarcely  a  single 
exception,  were  accepted  throughout  the  Nation,  as  authoritative 
arrangements  for  the  general  good,  without  question  as  to  the  author- 
ity upon  which  they  were  issued.  The  war-time  spirit  of  the  country 
and  its  industry  was,  in  the  main,  weapon  enough  to  enforce  any 
regulation  necessary  for  the  common  weal.  But,  withal,  the  com- 
pulsory forces  behind  the  war-industry  controls  exercised  by  the 
board  were  not  altogether  lacking.  They  came,  directly  or  indi- 
rectly, from  the  Army  appropriation  act,  which  was  made  law  on 
August  29,  1916  and  authorized  the  creation  of  a  Council  of  National 
Defense;  the  President's  well  known  letter  of  March  4,  1918;  the 
Overman  Act ;  and  other  grants  of  lesser  importance.1 

The  Army  appropriation  act,  of  which  the  pertinent  section  was 
analyzed  earlier  in  the  chapter,  authorized  the  creation  of  a  Council 
of  National  Defense.2  It  was  given  power  to  investigate  and  rec- 
ommend to  the  President  and  heads,  of  the  executive  departments 
in  matters  relating  to  the  location  of  railroads  to  help  concentrate 
troops  and  supplies  most  expeditiously ;  the  coordination  of  military, 
industrial,  and  commercial  purposes  in  the  location  of  highways; 
the  utilization  of  waterways ;  the  increase  of  domestic  production  of 
articles  and  materials  essential  to  the  support  of  armies  and  of  the 
people  during  the  interruption  of  foreign  commerce;  the  develop- 
ment of  sea-going  transportation;  data  as  to  amounts,  location, 

1  A  brief  digest  is  here  given  of  the  various  statutes  from  which  the  War  Industries 
Board  claimed  power  to  enforce  its  mandates  either  directly  or  indirectly. 

The  Council  of  National  Defense  act  (39  Stat.,  619)  authorized  the  President  to  take 
possession  and  assume  control  of  systems  of  transportation.  The  naval  emergency  fund 
act  (39  Stat.,  1168)  authorized  the  requisition  of  raw  materials  for  the  Navy  and,  in  so 
far  as  they  pertained  to  aircraft,  for  the  Army.  The  emergency  shipping  fund  act  (40 
Stat.,  182)  authorized  requisition  of  materials  for  ships  ;  the  food  control  act  (40  Stat., 
276)  granted  requisitory  powers  over  foods,  fuels,  and  other  supplies  necessary  to  the 
support  of  the  Army,  the  maintenance  of  the  Navy,  or  any  other  public  use  connected 
with  the  common  defense,  over  storage  facilities  for  supplies,  over  plants  for  the  pro- 
duction of  such  supplies,  over  plants  for  production  or  merchandising  of  coal  and  coke, 
and  over  distilled  spirits.  A  power  of  compulsory  order  with  penalties  for  refusal  was 
granted  in  the  national  defense  act  (39  Stat.,  166).  These,  with  various,  powers  of 
regulation  and  license  granted  in  the  food  and  fuel  acts,  the  espionage  and  trading- 
with-the-enemy  act  (40  Stat.,  225;  and  40  Stat.,  411),  and  the  power  of  regulation  of 
prices  granted  in  the  former  act,  and  of  priorities  in  transportation  iinder  the  priority 
in  transportation  act  of  Aug.  10,  1917 — lodged  in  various  agencies  of  the  Government 
such  power  to  vitalize  governmental  preferences  in  particular  fields  as  to  render  a  com- 
plete system  of  such  preferences  practicable.  While  these  powers  were  not  given  to 
the  War  Industries  Board  in  specific  statutory  terms,  by  close  cooperation  between 
the  agencies  to  which  they  were  granted,  and  by  the  transfer  of  power  to  the  War  In- 
dustries Board  under  the  Overman  Act,  the  whole  legislative  mechanism  was  amply 
sufficient  to  have  enforced  the  execution  of  all  directions  that  were  given. 

3  That  section,  quoted  earlier  in  the  chapter,  is  Section  2,  H.  R.  17498. 


GOVERNMENT    CONTROL,   OVER   PRICES.  207 

methods,  and  means  of  the  production  of  military  supplies ;  inform- 
ing the  producers  and  manufacturers  what  classes  of  supplies  are 
required  by  the  Government ;  and,  from  the  standpoint  of  the  study 
at  hand,  most  important  of  all,  "  the  creation  of  relations  which  will 
render  possible  in  time  of  need  the  immediate  concentration  and 
utilization  of  the  resources  of  the  nation."  It  was  primarily  under 
this  last  general  grant  of  power  that  the  Council  of  National  De- 
fense found  statutory  authority  for  setting  up,  as  a  part  of  it,  a  so- 
called  War  Industries  Board.1 

The  Army  appropriation  act,  authorizing  the  parent  council, 
gave  it  power  specifically  to  do  no  more  than  "supervise  and  direct 
investigations  and  make  recommendations  to  the  President  and  the 
heads  of  executive  departments."  The  War  Industries  Board,  as 
a  creature  of  the  council,  had  no  leg  in  law  more  firm  to  stand  upon 
than  that  early  fragmentary  power  given  during  peace  time. 

More  specific  far,  if  not  more  basic,  than  the  clauses  of  the  Army 
appropriation  act  were  the  functions  which  the  President  inter- 
preted under  it  in  his  letter  of  March  4,  1918.  That  letter,  writ- 
ten by  authority  of  the  above  act  and  his  general  war  powers,  was 
the-  immediate  and  most  definite  of  all  grants  of  power  made  to  the 
War  Industries  Board.  In  it,  after  appointing  a  new  chairman 
of  the  board,  he  redefined  its  functions  to  include  the  creation  of 
new  facilities  and  disclosing  new  sources  of  supply;  conversion  of 
existing  facilities  to  new  uses;  conservation  of  resources  and  facili- 
ties by  scientific,  commercial  and  industrial  economies;  advice  to 
the  Government  purchasing  agents  with  regard  to  prices  to  be  paid ; 
the  determination  of  priorities  in  production  and  delivery  where 
necessary;  and  the  making  of  purchases  for  the  Allies.  Then 
apart  from  the  above  powers  and  duties  assigned  by  him  to  the 
board  as  a  whole,  the  President  made  it  the  duty  of  the  chairman 
to  act  for  the  joint  and  several  benefit  of  all  supply  departments  of 
the  Government;  to  guide  and  assist  in  allocation  of  contracts,  in 
obtaining  access  to  materials,  the  finding  of  new  supplies  or  what- 
ever need  may  be  revealed;  to  determine  how  to  eliminate  conflict 
of  interest  between  departments  in  the  matter  of  supplies;  to  see 
that  contracts  and  deliveries  are  followed  up;  to  anticipate  the  re- 
quirements of  the  Government  and  to  meet  them.2 

The  act  creating  the  council,  while  not  defining  the  methods  to 
be  followed  in  planning  the  "concentration  and  utilization  of  the 
resources  of  the  Nation,"  had  placed,  on  the  other  hand,  no  restric- 

1  The  Council  of  National  Defense  was  given  authority  by  the  act  itself  '  to  organize 
subordinate  bodies  for  its  assistance  in  special  investigations,  either  by  the  employment 
of  experts  or  by  the  creation  of  committees  of  specially  qualified  persons  to  serve  with- 
out compensation,  but  to  direct  the  investigations  of  experts  so  employed." 

2  Letter  of  the  President  to  Bernard  M.  Baruch  of  Mar.  4,  1938. 


208  HISTORY    OF   PRICES   DURING   THE    WAR. 

tions  upon  the  council  within  its  general  grant  of  power.  The 
President's  letter,  though  more  specific  and  sweeping  in  its  enu- 
meration of  powers,  did  clamp  upon  the  War  Industries  Board  as 
such  two  distinct  restrictions  in  power.  The  President  specifically 
asked  Mr.  Baruch,  as  chairman  of  the  War  Industries  Board,  "to 
let  alone  what  is  being  successfully  done  and  interfere  as  little  as 
possible  with  the  present  normal  process  of  purchases  and  delivery 
in  the  several  departments."  The  other,  and  for  this  inquiry  more 
pertinent,  restriction  upon  the  War  Industries  Board  and  its  chair- 
man was  the  limitation  placed  upon  its  right  to  fix  prices.  The 
President  left  the  final  decision  of  all  questions  relative  to  its  control 
over  industry,  except  the  determination  of  prices,  with  its  chairman. 
This  specific  exception  was  striking,  and  gave  rise  to  the  creation  by 
the  President  of  a  price-fixing  committee. 

The  passage  of  the  Overman  Act  on  May  20, 1918,1  gave  a  new  face, 
if  not  a  new  content,  to  the  powers  of  the  War  Industries  Board. 
One  of  the  purposes  of  the  act  was  the  "better  utilization  of  re- 
sources and  industries,"  but  under  it  the  President  was  given  no  new 
powers  other  than  those  pertaining  to  a  redistribution  of  functions, 
duties,  and  powers  already  conferred  by  law.  It  authorized  him, 
as  he  did  on  May  28,  1918,  to  break  the  War  Industries  Board  apart 
from  the  Council  of  National  Defense  and  set  it  up  as  a  body  quite 
independent  and  charged  to  perform  the  duties  outlined  in  his 
earlier  letter.  That  separation  itself  gave  a  considerable  show  of 
added  authority,  which  for  war-time  purposes  was  about  as  effective 
as  additional  statutory  powers. 

The  basis  in  law  of  the  creation  and  powers  of  the  War  Industries 
Board,  then,  was  not  as  firm  or  definite  as  that  of  the  Food  Adminis- 
tration and  Fuel  Administration.  The  latter  were  the  creatures  of 
specific  legislative  action  by  the  Congress  after  we  had  entered  the 
war2  and  were  given  very  definite  war-time  controls  to  administer 
with  ample  power  and  with  the  enforcement  of  penalties.  The  War 
Industries  Board  was  the  creature  of  a  peace-time  statute,  adopted 
as  the  nearest  authority  at  hand  for  a  makeshift  but  immediate  or- 
ganization of  the  board,  and  later  filled  with  new  purpose  and  in- 
spiration by  a  letter  from  the  President.  The  war-time  spirit  of  the 
country  was  an  immeasurable  power  upon  which  to  draw  for  the 
enforcement  of  regulations.  It  is  much  more  evident  that  the  War 
Industries  Board  sadly  lacked  a  full  grant  of  legislative  power  than 
that  it  suffered  much  from  the  lack. 

1  See  S.  3771  for  Overman  Act  in  full. 

2  Created  by  the  food  and  fuel  act  of  Aug.  20,  1917. 


GOVERNMENT    CONTROL   OVER   PRICES.  209 

THE  POLICY  OF  Mil.   BARUCH. 

The  paucity  of  power  given  by  law  to  the  War  Industries  Board 
and,  more  especially,  the  ill-defined  character  of  that  power,  aroused 
a  lively  interest  in  the  policies  of  Mr.  Bernard  M.  Baruch.  He,  it 
might  be  supposed,  had  at  his  disposal  a  wider  freedom  to  control 
after  his  own  fashion  than  had  any  other  industry-controlling  chair- 
man at  Washington.  If  the  Congress  had  not  created  his  board  by 
special  enactment,  neither  had  it  defined  his  course  for  him  or  tied 
his  hands.  Mr.*  Baruch,  with  the  war  on,  was  not  in  need  of  more 
far-reaching  powers  unless  he  contemplated  somewhat  radical  regu- 
lation. He  did  not,  in  point  of  fact,  complain  of  lack  of  power  or 
go  to  the  Congress  for  more.  It  might  from  these  points  be  inferred, 
as  was  a  fact,  that  Mr.  Baruch  by  necessity  and  by  choice  ordinarily 
did  not  announce  policies  of  control  until  each  problem  arose  and  was 
attacked.  -There  is  little  more  to  say  of  his  policies  than  that  he  went 
before  the  country  with  no  hard  and  fast  policies  of  control ;  he  dele- 
gated the  making  and  administering  of  those  policies  to  commodity 
chiefs,  known  as  "  dollar  a  year  "  men,  and  chosen  from  the  trade ; 
and  that  he  maintained  a  well-planned  organization  of  contacts  with 
all  of  the  Government  and  the  industry. 

The  problem  put  to  the  War  Industries  Board  was  too  involved, 
difficult,  and  big  to  state  in  a  word  or  comprehend  at  once  how  best 
to  attack  it.  The  Board  became  virtually  responsible  for  turning 
the  whole  of  industry,  save  the  food  and  fuel  industries,  into  war 
uses.  But,  except  where  there  appeared  a  war  requirement  to  fill,  it 
pursued  religiously  a  policy  of  noninterference.  The  task  of  fulfill- 
ing Government  and  allied  orders  made  the  War  Industries  Board 
deal,  in  the  main,  with  the  big-business  end  of  industry,  much  as  the 
task  of  conserving  foods  made  the  Food  Administration  deal  so 
largely  with  the  smaller  dealers  and  consumers.  The  regulation  of 
the  steel  industry,  which  was  said  to  be  controlled  by  seventeen  men 
who  could  be  gathered  into  one  room  at  Washington,  required  a  quite 
different  method  from  that  applicable  to  the  regulation  of  wheat. 
Mr.  Baruch,  himself  strictly  a  business  man  by  experience  and  point 
of  view,  was  in  a  strategic  position  to  fraternize  with  the  trade  and 
give  it  a  more  tolerant  attitude  toward  Government  interference. 
He,  as  they  knew,  had  been  in  Washington  a  full  year  when  the 
President  asked  him  to  take  the  chairmanship  of  the  War  Industries 
Board  on  March  4,  1918.  During  that  time,  furthermore,  he  had 
mixed  freely  with  them  and  convinced  them  that  he  was  bent  upon 
no  revolution  of  industry  and  would  ask  nothing  beyond  what  was 
vitally  needed  in  war  time. 
125547°— 20 14 


210  HISTORY  OF  PRICES  DURING  THE   WAR. 

There  seemed  to  Mr.  Baruch  no  occasion  for  wide  publicity  or 
propaganda  among  the  millions  of  small  dealers  and  consumers, 
and  the  majority  of  contacts  made  by  the  board  with  the  country 
were  made  informally  around  conference  tables  with  the  leaders 
of  industry.  He  preferred  frankly,  as  necessity  to  control  an  addi- 
tional industry  arose,  to  meet  that  industry  separately  and  make 
individual  agreements  which  seemed  at  the  time  the  most  expedient. 
Mr.  Baruch,  therefore,  did  not  during  the  whole  war  formulate  and 
advertise  any  general  or  dominating  principles  of  industrial  control. 

As  said  above,  it  was  the  policy  of  Mr.  Baruch  to  delegate  the 
making  and  administration  of  detailed  policies  to  his  "  dollar-a- 
year  "  men,  whom  he  had  called  to  the  board  from  the  trade.  These 
commodity  chiefs,  who  were  presidents  and  managers  of  large  firms 
during  peace  time,  brought  the  Government  and  the  industry  quickly 
together.  All  of  them,  through  the  cooperation  of  hundreds  of  war- 
service  committees  authorized  to  speak  for  the  various  trades,  main- 
tained an  intimate  and  frequent  contact  with  -production  and  price 
conditions  of  each  important  raw  material  and  finished  product. 
They  formed  the  most  ready  and  most  effective  of  all  the  links 
between  the  Government  and  industry.  The  most  distinguished  of 
all  the  policies  of  Mr.  Baruch  was  found  in  the  organization  of  con- 
tacts. He  believed  thoroughly  in,  and  did  develop,  a  wide  scheme 
of  contacts  within  the  Government  and  out.  One  of  the  first  things 
which  Mr.  Baruch  set  out  to  do,  when  he  came  into  the  chairmanship 
of  the  board,  was  to  perfect  and  establish  lines  of  personal  contact 
with  every  war  agent  of  the  Government  and  every  organized  branch 
of  war  industry  under  his  control. 

THE  ORGANIZATION  OF  THE  BOAED. 

There  is  little  danger  of  emphasizing  too  often  the  value  to  the 
war-industry  control,  realized  through  the  organization  scheme  of 
the  War  Industries  Board.  That  board  was  made  at  every  angle  to 
synchronize  Government  requirements  and  supply.  The  functions 
of  gathering  requirements,  clearing  purchases,  allocating  orders  to 
the  trade,  making  procurements,  determining  priorities  in  production 
and  delivery,  curtailing  less  or  nonessential  production,  instituting 
conservation  programs,  and  controlling  prices  were  conceived  and 
assigned  to  distinct  divisions  of  the  War  Industries  Board.  Each 
commodity  section,  headed  by  a  chief  from  the  board  proper,  was 
composed  of  niembers  from  all  other  Government  purchasing  agencies 
interested  in  that  particular  commodity.  The  chief,  through  his 
war-service  committees,  was  also  as  closely  affiliated  in  contact  with 
the  trade.  Each  commodity  section,  then,  to  a  smaller  degree,  was 
the  center  of  information  pertaining  to  the  demand  and  supply  of  its 


GOVERNMENT   CONTROL   OVER   PRICES.  211 

particular  commodity  as  was  the  Board  for  the  whole  of  industry.1 
These  smaller  sections  were  organized  in  larger  divisions  subordinate 
to  the  board  proper  consisting  of  Chairman  Bernard  M.  Baruch,  a  vice 
chairman  who  also  represented  the  allied  purchasing  commission,  a 
representative  of  the  Army,  a  representative  of  the  Navy,  the  priori- 
ties commissioner,  the  chairman  of  the  price-fixing  committee,  a 
representative  of  labor,  the  director  of  steel,  the  commissioner  of 
finished  products,  and  a  technical  advisor. 

THE  RELATION  OF  THE  BOARD  TO  PRICE  FIXING. 

Scarcely  an  important  action  was  taken  by  the  War  Industries 
Board  which  did  not  affect  prices,  and  account  should  be  taken  of 

1  A  clearer  idea  of  the  important  organization  scheme,  set  up  by  the  War  Industries 
Board,  to  unite  Government  requirements  and  industry  production,  as  it  stood  at  the 
signing  of  the  armistice,  follows : 

Organisation  scheme  of  the  War  Industries  Board. — Divisions :  Building  materials 
division,  chemical  division,  conservation  division,  division  of  planning  and  statistics,  ex- 
plosives division,  facilities  division,  finished  products  division,  hide,  leather,  and  leather 
goods  division,  labor  division,  price  fixing  committee,  priorities  division,  pulp  and  paper 
division,  purchasing  commission  for  the  Allies,  requirements  division,  steel  division, 
textile  division.  Sections :  Acids  and  heavy  chemicals  section  (chemical  divi- 
sion), agricultural  implements,  animal  and  hand-drawn  vehicles,  and  wood  products 
section,  alkali  and  chlorine  section  (chemical  division),  automotive  products 
section,  belting  section  (hide,  leather,  and  leather  goods  division),  boot  and  shoe  sec- 
tion (hide,  leather,  and  leather  goods  division),  brass  section,  bureau  of  warehouse 
distribution  (steel  division),  chain  section,  chemical  glass  and  stoneware  section 
(chemical  division),  clearance  office,  coal-gas  products  section  (chemical  division), 
cotton  and  cotton  linters  section  (textile  division),  cotton  goods  section  (textile  division), 
crane  section,  creosote  section  (chemicals  division),  division  of  business  administration, 
domestic  skins  and  hides  section  {hide,  leather,  and  leather  goods  division),  electrical 
and  power  equipment  section,  electrodes  and  abrasives  section  (chemical  division),  elec- 
tric wire  and  cable  section,  emergency  construction  committee,  ethyl  alcohol  section 
(chemical  division),  felt  section  (textile  division),  ferro-alloys  section  (chemical  divi- 
sion), fiber  board  and  container  section  (pulp  and  paper  division),  fire  prevention  section, 
flax  products  section  (textile  division),  forgings,  guns,  small  arms,  and  small-arms 
ammunition  section,  gloves  and  leather  clothing  section  (hide,  leather,  and  leather 
goods  division),  gold  and  silver  section  (chemical  division),  hardware  and  hand  tool  sec- 
tion, harness  and  personal  equipment  section  (hide,  leather,  and  leather  goods  division), 
hides  and  skins  section  (hide,  leather,  and  leather  goods  division),  inland  traffic  section, 
iron  and  steel  scrap  section  (steel  division),  jute,  hemp,  and  cordage  section,  knit  goods 
section  (textile  division),  labor  section  (priorities  division),  legal  section,  lumber  sec- 
tion, machine  tool  section,  manufacturing  section  (pulp  and  paper  division),  medical 
section,  mica  section  (chemical  division),  military  optical  glass  and  instrument  section, 
miscellaneous  chemicals  section  (chemical  division),  miscellaneous  commodities  section, 
news  section — committee  on  public  information,  newspaper  section  (pulp  and  paper 
division),  nitrates  section  (chemical  division),  nonferrous  metals  section,  nonwar  con- 
struction section,  paint  and  pigment  section  (chemical  division),  paper  economies  section 
(pulp  and  paper  division),  periodical  section  (pulp  and  paper  division),  platinum  section 
(chemical  division),  power  section,  projectile  steel  rails,  alloy  steel,  and  cold-drawn  steel 
section  (steel  division),  permit  section  (steel  division),  pig  iron  section  (steel  division), 
price  section  (division  of  planning  and  statistics),  railway  equipment  and  supply  section, 
refractories  section  (chemical  division),  resources  and  conversion  section,  rubber  section 
(textile  division),  sheepskin  and  glove  leather  section  (hide,  leather,  and  leather  goods 
division),  silk  section  (textile  division),  sole  and  belting  leather  section  (hide,  leather, 
and  leather  goods  division),  special  advisory  committee  on  plants  and  munitions,  statis- 
tics section  (steel  division),  steel  products  section  (steel  division),  stored  materials  sec- 
tion, sulphur-pyrites  section  (chemical  division),  synthetic  dye  and  intermediate  section 
(chemical  division),  tanning  materials  and  vegetable  (lye  section  (chemical  division), 
technical  and  consulting  section  (chemical  division),  tin  section,  tobacco  section,  upper, 
harness,  bag,  and  strap  leather  section  (hide,  leather,  and  leather  goods  division),  wood 
chemicals  section  (chemical  division),  woolens  section  (textile  division),  wool  section, 
domestic  (textile  division),  wool  section,  foreign  textile  division). 


212  HISTORY  OF  PRICES   DURING  THE   WAR. 

till  that  the  board  did  if  it  is  hoped  to  tell  in  full  the  tale  of  war- 
time control  over  prices. 

But,  strictly  speaking,  the  War  Industries  Board  was  not  a  price- 
fixing  agency  and  had  no  independent  hand  in  the  fixing  of  prices. 
The  price-fixing  committee,  while  popularly  thought  a  creature  of 
the  War  Industries  Board  and  under  its  directions,  was  really  created 
by  the  President  as  an  organization  independent  of  the  board. 

It  will  be  recalled  that  the  President,  in  his  letter  .of  March  4,  not 
only  failed  to  give  the  War  Industries  Board  powers  to  control 
prices,  but  specifically  limited  it  in  that  power.  He  gave  the  chair- 
man a  free  hand  in  all  other  delegated  controls,  "  except  the  deter- 
mination of  prices,"  and  declared  that — 

In  the  determination  of  prices  the  chairman  should  be  governed  by  the  advice 
of  a  committee  consisting,  besides  himself,  of  the  members  of  the  Board  imme- 
diately charged  with  the  study  of  raw  materials  and  of  manufactured  products, 
of  the  labor  member  of  the  board,  of  the  chairman  of  the  Federal  Trade  Com- 
mission, the  chairman  of  the  Tariff  Commission,  and  the  Fuel  Administrator.1 

It  seems  doubtful,  in  view  of  these  limitations,  whether  any  con- 
siderable formal  power  to  fix  prices  was  given  to  the  War  Industries 
Board  of  itself.  The  commodity  chiefs,  again  and  again,  however, 
came  to  informal  agreements  with  the  trade  and  in  reality  often  de- 
termined what  prices  should  be  asked  of  the  Government  and  the 
civilian  trade.  The  board  worked  hand  in  glove  with  the  price-fixing 
committee  and,  in  a  large  way,  was  the  administrative  organ  to 
which  the  committee  looked  for  the  enforcement  of  prices  which  it- 
fixed. 

(3)   THE  KINDS  OF  CONTROL  EXERCISED. 

Once  the  War  Industries  Board  had  learned  the  problem  facing  it, 
and  saw  that  it  must  make  itself  the  Government  clearing  house  for 
war-time  industrial  needs,  there  was  presented  the  necessity  for  or- 
ganizing controls  to  that  end.  The  departments  came  with  war  re- 
quirements, and  left  it  to  the  War  Industries  Board  to  meet  them  as 
it  would.  No  war  board  at  Washington  undertook  such  a  multi- 
plicity of  controls,  for  no  other  covered  a  field  so  wide.  It  was  re- 
sponsible virtually  for  the  whole  of  industry  save  food  and  fuel,  and 
had  to  administer  it  by  the  use  of  many  quite  distinct  forms  of  con- 
trol. Any  person  who  served  with  the  War  Industries  Board  instinc- 
tively thinks  of  its  work  under  the  technical  terms, — "  requirements," 
"  clearances,"  "  priorities,"  "  allocations,"  "  curtailments,"  "  conserva- 
tion," "  prices,"  and  others  of  lesser  importance.  Each  of  these  spe- 
cial kinds  of  control  affected  prices  and,  indeed,  might  be  called 
phases  of  price  control.  No  study  of  the  problem  touching  Govern- 

TThe  price-fixing  committee,  with  Mr.  Robert  S.  Brookings  as  chairman,  was  ap- 
pointed by  the  President  and  had  its  first  meeting  Mar.  14,  1918. 


GOVERNMENT  CONTROL  OVER  PRICES.  213 

ment  control  over  prices  could  claim  comprehensiveness  without  some 
analysis  of  these  phases. 

REQUIREMENTS. 

There  were  few  problems  which  Mr.  Baruch  at  the  outset  saw 
more  clearly  than  the  need  for  a  mechanism  to  receive  and  classify 
Government  requirements.  He  impressed  that  fact,  through  his 
chiefs,  upon  the^  Government  and  on  April  2,  1918,  announced  the 
creation  of  a  new  requirements  division.  It  was,  in  a  sense,  the 
funnel  through  which  the  Government  sent  its  requests  for  com- 
modities to  the  War  Industries  Board  preparatory  to  later  clearance 
and  allocation.  It  was  the  organ  which  Mr.  Baruch  set  up  in  re- 
sponse to  the  President's  letter  asking  him  to  keep  "  as  far  in  ad- 
vance as  possible"  a  watch  of  the  "  respective  needs"  of  the  Govern- 
ment and  Allies  and  saying  that  he  "  should  be  constantly  and  scien- 
tifically informed  of  all  contracts,  purchases,  and  deliveries  in  order 
that  he  may  have  always  before  him  a  schematized  analysis  of  the 
progress  of  business  in  the  several  divisions  of  the  Government  in 
all  departments."  The  new  requirements  division,  as  conceived  by  the 
President  and  by  his  newly  appointed  chairman,  was  to  be  the  focus 
of  all  the  war-industry  controls  over  the  production  and  distribution 
of  raw  materials  or  finished  products  required  by  the  Government 
or  her  Allies.  There  passed  through  it  during  the  war  literally 
thousands  of  requirements.1 

The  requirements  division,  because  designed  to  bring  to  one  table 
all  Government  requirements,  was  organized  to  include  representa- 
tives from  all  agencies  which  made  considerable  purchases  for  war 
purposes  in  the  Government  and  out  (Army,  Navy,  Emergency  Fleet, 
Marine  Corps,  Railroad  Administration,  Housing  Corporation  of 
the  Department  of  Labor,  Purchasing  Agency  of  the  Panama  Canal, 
Allied  Purchasing  Commission,  Eed  Cross,  Y.  M.  C.  A.,  Knights 
of  Columbus,  and  the  Commission  on  Training  Camp  Activities). 
The  Food  Administration  and  Fuel  Administration,  too,  were  given 
opportunity  to  attend  the  meetings  when  they  desired  projects  that 
involved  materials,  supplies,  facilities,  electrical  power,  fuel  or  trans- 
portation affecting  the  industries.  The  requirements  division,  though 
loosely  organized  enough  to  permit  changes  and  the  entrance  of 
new  representatives  from  time  to  time,  consisted  of  its  chairman 
and  the  more  important  divisional  heads  of  the  War  Industries 

1  The  records  of  the  requirements  division  show  that  the  consecutive  numbers  of 
separate  requirements  totaled  five  thousand  odd,  which  included  all  of  the  Government 
and  part  of  the  allied  requirements  handled.  But  in  addition,  there  were  hundreds  of 
allied  requirements  not  so  numbered.  The  bulk  of  all  these  requirements  did  not  start 
coming  in  until  the  fall  of  1918,  when,  sometimes,  several  hundred  came  in  a  single 
morning. 


214  HISTORY   OF   PRICES   DURING   THE   WAR. 

Board,  assembled  in  conference  with  the  supply  heads  for  the  Gov- 
ernment and  the  Allies.1 

It  took,  in  point  of  fact,  soiree  months  to  impress  the  Government 
and  the  Allies  with  the  necessity  for  a  strict  and  constant  estimate  of 
future  requirements.  That  shortsightedness  gave  the  War  Indus- 
tries Board  one  of  its  most  difficult  problems.  A  vast  number  of  the 
shortages  had  come  simply  from  failure  to  look  ahead  for  needs. 
The  new  requirements  division,  therefore,  devoted  itself  to  the  task 
of  gathering  future  requirements  and  left  the  immediate  needs  to  the 
clearance  committee.  The  work  of  the  division,  as  the  plan  behind 
it  gradually  took  root,  grew  tremendously  in  importance  and  in 
effectiveness. 

The  routine  by  which  all  requirements  were  received  at  a  central 
point  and  distributed  to  the  commodity  chiefs  is  indicative  of  the 
policy  behind  the  whole  scheme.  The  various  Government  and  allied 
representatives,  who  throughout  Washington  on  the  day  previous  had 
made  new  requirement  estimates,  brought  those  requirements  to  the 
War  Industries  Board  each  morning.  They  were  there  read  aloud  in 
the  requirements  division  and,  as  the  representatives  chose,  discussed. 
The  discussion  did  not,  of  course,  turn  upon  whether  the  future 
requirement  should  be  allowed  or  disallowed.  That  determination 
was  left  to  the  time  when  these  requirements  should  ripen  into  clear- 
ances. It  turned  rather  upon  whether  there  was  a  shortage  and,  if 
so,  how  the  requirement  should  be  met.  The  requirements,  after  the 
meeting,  were  sent  forthwith  to  the  commodity  chiefs  of  the  War 
Industries  Board. 

These  commodity  sections,  each  headed  by  a  chief  representing  the 
War  Industries  Board,  included  representatives  from  each  supply 
department  of  the  Government  interested  in  the  commodity  required. 
It  was  the  business  of  the  commodity  chief,  with  the  advice  of  his 
section  members,  to  find  ways  to  meet  the  requirements  and,  later 
on,  to  allocate  them.  The  department  which  originally  submitted 
the  requirement  was  expected  to  keep  account  of  it  through  a  repre- 
sentative in  the  commodity  section  to  which  the  requirement  had  been 
referred.  At  the  last,  the  commodity  chiefs  were  asked  to  fill  out  a 
blank  for  the  requirements  division  in  receipt  of  each  requirement, 
stating  in  detail  whether  and  how  the  industry  could  meet  the 

1  The  requirements  division,  as  originally  organized,  was  made  to  include  Mr.  Alex.  Legge 
(chairman),  the  executive  secretary  of  the  War  Industries  Board,  the  priorities  com- 
missioner, the  chief  of  finished  products  division,  the  chief  of  the  iron,  steel,  and  steel 
products  division,  the  chief  of  the  chemicals  and  explosives  division,  the  chief  of  the 
nonferrous  metals  section,  one  or  more  representatives  of  the  War  Department,  one  or 
more  representatives  of  the  Navy  Department,  a  representative  of  the  Marine  Corps, 
one  or  more  representatives  of  the  Emergency  Fleet  Corporation,  and  a  representative 
of  the  Railroad  Administration.  Later,  Mr.  James  Inglis  and  finally  Mr.  W.  E;  Guylee 
was  made  secretary. 


'GOVERNMENT  CONTROL  OVER  PRICES.  215 

requirement.  Each  commodity  chief  was  asked  to  consider  market 
conditions  pertinent  to  the  requirements ;  recommend  purchase  plans 
to  the  several  purchasing  departments ;  and,  if  it  seemed  necessary  to 
control  an  industry  in  whole  or  in  part  by  allotments,  to  determine 
the  allocation  of  materials,  commodities,  and  facilities  to  the  several 
Government  departments,  Allies,  and  to  civilians. 

CLEABANCES. 

The  War  Industries  Board,  with  all  of  its  emphasis  upon  the  need 
for  anticipating  and  recording  future  Government  requirements,  had 
only  perfected  its  mechanism  to  that  end  a  short  while  before  the 
armistice  was  declared.  These  so-called  requirements,  as  time  went 
on,  each  ripened  into  a  clearance  and  in  theory  every  clearance 
should  have  been  anticipated  in  some  previous  requirement.  A 
"  requirement,"  as  commonly  termed,  was  a  future  requirement,  and 
a  "  clearance "  was  an  immediate  requirement.  The  one  in  logic 
preceded  the  other.  But,  in  point  of  practice,  under  the  intense 
pressure  of  their  other  work  the  officials  found  it  exceedingly  difficult 
to  estimate  their  requirements  until  the  very  hour  when  there  came 
a  pressing  need  for  them.  The  beginnings  of  clearances,  therefore, 
date  back  to  the  start  of  the  war  and  they  far  exceed  the  estimated 
requirements  which  were  sent  to  the  requirements  division  prior  to 
their  being  actually  cleared. 

The  clearance  committee. — The  General  Munitions  Board  at  the 
beginning  of  the  war  saw  the  necessity  for  coordinating  the  pur- 
chase branches  of  the  Government,1  and  created  under  it  a  clearance 
committee  comprising  a  chairman,  a  secretary,  and  representatives 
from  the  General  Staff,  the  separate  purchase  branches  of  the  Army, 
the  Navy,  the  Allied  Purchasing  Commission,  the  Marine  Corps,  and 
the  important  sections  of  the  General  Munitions  Board.2  This  early 
committee  attempted  to  bring  together  the  purchasing  of  war  mate- 
rials, to  adjust  matters  of  priority  between  the  various  departments 
and  to  keep  a  watch  over  shortages  of  materials.  One  of  the 
most  important  of  the  early  functions,  perhaps,  was  the  meeting 
ground  it  afforded  to  the  supply  bureaus  of  the  Army.  In  May, 
1918,  however,  the  Army  centralized  its  own  purchases  in  a  newly 
created  purchase  and  supply  branch  of  the  purchase,  storage,  and 
traffic  division.  There  was  then  less  occasion  for  the  Army  to  send 
more  than  one  representative  to  the  clearance  committee  conferences. 

irThe  Council  of  National  Defense  first  asked  the  General  Munitions  Board  to  make 
clearances  on  Apr.  28,  1917. 

2  Mr.  Frank  A.  Scott  was  made  chairman  of  the  clearance  committee  at  its  inception. 
When  he  resigned  the  chairmanship  passed  to  Lieut.  Col.  C.  C.  Bolton,  who  held  it 
until  the  reorganization  of  the  committee,  when  Rear  Admiral  F.  F.  Fletcher  was  made 
chairman. 


216  HISTORY   OF  PRICES   DURING  THE   WAR. 

The  clearance  committee,  by  coordinating  all  supply  purchases,  elimi- 
nated in  large  measure  competitive  bidding  by  various  branches  of 
the  Government  for  the  same  material.  It  took  especial  interest  in 
watching  prices  and,  where  there  appeared  shortages  of  materials, 
issued  clearance  lists.  But  it  became  more  and  more  difficult  for  the 
clearance  committee,  even  as  reorganized  in  May,  to  handle  the  volume 
of  work  before  it. 

The  numbers  of  immediate  requirements  that  needed  clearance  each 
morning  grew  into  the  hundreds  and  made  utterly  hopeless  any  more 
than  a  mere  perfunctory  reading  of  them  at  the  clearance  committee 
meetings.  The  enormous  increases  in  Government  purchases,  though 
none  the  less  demanding  coordination  or  clearance,  gave  the  committee 
more  work  than  it  could  do  either  with  care  or  expedition.  That  con- 
sideration, and  the  development  of  the  commodity  sections  within  the 
War  Industries  Board,  contributed  to  another  and  final  organiza- 
tion of  the  clearance  work.  The  commodity  sections,  after  a  time, 
were  made  to  include  representatives  from  each  of  the  Government 
purchasing  agencies.  Obviously,  then,  the  logical  disposal  for  the 
clearance  committee  to  make  of  each  immediate  requirement  was  to 
clear  it  directly  through  the  commodity  chiefs.  These  reasons  ex- 
plain why  the  deliberative  work  became  less  and  less  important  and 
the  routine  of  distributing  clearances  more  and  more  so.  They  ex- 
plain why,  in  a  word,  the  old  clearance  committee  was  abolished  on 
July  24, 1918,  and  its  work  was  delegated  to  a  newly  created  clearance 
office  within  the  requirements  division. 

The  clearance  office. — It  was  the  business  of  the  clearance  office  to 
receive  all  requests  for  clearances,  record  them,  and  distribute  them 
promptly  to  the  proper  commodity  sections.  It  had,  furthermore,  to 
urge  action  by  the  commodity  sections  and,  after  clearance,  to  in- 
form every  purchasing  department  of  the  Government  of  the  pros- 
pective purchases  of  every  other  department.  Throughout  the  war 
there  were  cleared,  by  the  clearance  committee  and  later  by  the  clear- 
ance office,  altogether  29,000  immediate  requirements.  Of  that  total, 
80  per  cent  emanated  from  the  War  Department,  15  per  cent  from 
the  Navy  Department,  and  5  per  cent  from  the  other  departments. 
It  is  interesting  and  relevant  to  note  that  the  War  Industries  Board 
granted  about  95  per  cent  of  all  requests  for  clearance  and  that  5 
per  cent  were  refused  by  reasons  of  adjustment  of  war  needs  between 
ourselves  and  the  Allies.  The  War  Industries  Board  was,  of  course, 
the  central  point  to  which  all  prospective  war  purchases  were 
brought  for  clearance.  It,  therefore,  required  that  all  Government 
departments  report  such  purchases  to  its  clearance  office  in  so  far  as 
they  appeared  on  a  confidential  so-called  clearance  or  "  shortage " 
list. 


GOVERNMENT   CONTROL   OVER   PRICES.  217 

TTie  clearance  list. — Xo  bureau  of  the  Government  had  such  a 
check  upon  shortage  of  supplies  as  had  the  War  Industries  Board 
through  its  clearance  work.  There  was  early  made  up  as  a  working 
basis  a  clearance  list,  upon  which  were  entered  from  time  to  time  the 
specific  articles  of  which  there  was  shortage  and  for  which  clearance 
was  required.  The  practice  at  the  start  was  to  list  separate  com- 
modities as  necessity  demanded.  The  clearance  office  later,  however, 
made  the  sweeping  additions  to  the  clearance  list  of— 

all  schedules  of  prospective  purchases  involving  orders  for  any  articles  or 
commodities,  to  be  placed  in  the  congested  district,  which  orders  shall  call  for 
or  involve  the  creation  or  use  of  additional  fuel,  power,  or  transportation 
facilities, 

and 

all  schedules  of  prospective  purchases  involving  the  creation  of  new  or  addi- 
tional facilities  wherever  placed  and  however  created. 

The  clearance  list,  in  point  of  fact,  came  at  last  to  cover  virtually 
the  whole  list  of  important  war-making  materials.1 

1  There  follows  a  copy  of  the  clearance  list  (or  "shortage  list")  as  it  stood  at  the 
signing  of  the  armistice. 

Clearance  list.— Before  negotiations  are  instituted  clearance  must  be  obtained  on  pro- 
posed purchases  of  articles  or  commodities  in  the  four  following  general  classifications : 

1.  All  schedules  of  prospective  purchases  involving  articles  or  commodities  on  the  list 
given  below,  entitled  "  Clearance  schedule." 

2.  All  schedules  of  prospective   purchases  involving  orders,  for   any   articles   or   com- 
modities, to  be  placed  in  the  congested  district,  which  orders  call  for  or  involve  the  crea- 
tion or  use  of  additional  fuel,  power,  or  transportation  facilities.     The  boundaries  of  the 
congested  district  will  be  defined  from  time  to  time  by  the  Railroad  Administration,  Fuel 
Administration,  and  War  Industries  Board,  and  will  be  published  by  the  latter.     This  con- 
gested district  now  is  included  between  the  Atlantic  Ocean  and  a   line  drawn  through 
Chesapeake  Bay  to  Baltimore,  north  to  Harrisburg,  west  to  Altoona,  northeast  through 
Williamsport,  Binghampton,  and  Schenectady  to  the  Hudson  River,  and  thence  north  to 
the  northeastern  boundary  of  the  State  of  New  York.    The  districts  served  by  the  electrical 
power   companies   of  Canton,   Baltimore,   Massillon,  Alliance,   Niagara   Falls,    Pittsburgh, 
Connellsville,  Wheeling,  Youngstown,  and  Akron  are  also  prohibited  centers  due  to  lack 
of  power. 

3.  All    schedules   of    prospective   purchases    involving    the    creation    of    new    or    addi- 
tional facilities  wherever  placed  and  however  created  ;  that  is,  either  direct  or  indirect 
Government  business ;  and  including  all  war  building  of  any  nature  whatsoever. 

4.  The  orders  for  production  in   Government   plants  do  not   require  clearance  so  far 
as  the  actual  order  itself  is  concerned,  though  the  material  required  for  filling  the  order 
will  require  clearance  if  on  the  clearance  list.     At,  the  time  requirements  are  presented, 
statement  must  be  made  as  to  whether  the  Government  department  at  interest  is  in  a 
position  to  handle  all  or  any  part  of  the  order  within   its  own  plants. 

Clearance  schedule. — Acids,  agricultural  implements,  vehicles  (not  auto  propelled),  and 
wood  products : 

(a)  Vehicles: 
Army  wagons. 

Army  carts,   two-wheel. 

Artillery  wheels,  spokes,  and  hubs. 

Spare  parts. 

(b)  Truck  bodies. 

(c)  Wood  products,  meaning  handles,  boxes,  containers,  crates,  propellers,  etc. 
(<i)    Agricultural   tractors. 

Automotive  products,  meaning : 

(a)    Motors,  truck,  tractor,  aeroplane. 
(6)    Transmissions. 


218  HISTORY   OF   PRICES   DURING  THE    WAR. 

PRIORITIES. 

Little  control  would,  indeed,  have  been  exercised  over  industry 
in  this  country  had  the  War  Industries  Board  simply  gathered  in, 

Automotive  products,  meaning — Continued. 

(c)  Axles. 

(d)  Springs. 

(e)  Forgings. 
(/)   Tires,  solid. 

(g)    Rims,  pressed  on. 

(7i)    Motor-cycle  rims. 

(i)    Pneumatic  tires. 

(;)    Steel  wheels. 

(k)    Magnetos. 

(I)    Spark  plugs. 

(m)   Valves. 

(n)    Cam  shafts,  finished  and  rough. 

(o)   Crank  shafts,  finished  and  rough. 

(p)   Trucks. 

(g)    Military  tractors. 

(r)   Motor  cycles. 

(s)   Trailers. 

(t)    Storage  batteries. 

(u)    Ball  and  roller  bearings. 

(v)    Steel  castings  for  motor  cars. 

(u;)   Drive  and  link  belt  chains. 

(<c)   Radiators. 

(y)    Babbitt-lined  bearings. 

(z)    Frames. 

(aa)   Truck  bodies  for  motor  chassis. 

(66)    Sets  of  spare  parts  for  automotive  vehicles. 
Brass  and  copper  rods,  tubing,  and  sheets. 
Chains  (all  chains  other  than  automotive  drive  and  link  belt). 
Chemicals. 
Cordage,  hemps,  and  fibers,  including — 

(0)  Jute. 
(6)    Manila. 

(c)  Kapok  mattresses,  pillows,  pads,  and  life  garments. 

(d)  Coir  yarns. 

(e)  Manila  rope. 

(f)  Sisal  rope. 

(fir)  Cocoa  mats  and  cocoa  matting. 

(h)  Linoleum. 

(1)  Oakum. 
(;)  Burlap. 

Cork. 

Cotton  linters. 
Cotton  goods. 
Cranes — 

(0)  Locomotive. 

(6)  Electric  traveling. 

(c)  Gantry. 

(d)  Shipyard. 

(e)  Buckets    (grab  buckets). 
(/)  Hoists. 

(fir)    Portable  electric. 
(h)   Electric  monorail 

(1)  Wrecking. 

(;)   Track  pile  drivers. 
Cylinders  and   containers    (pressure). 
Drawing  instruments. 
Electric  equipment — 

(a)    Generators. 

(&)   Turbines. 


GOVERNMENT   CONTROL   OVER   PRICES.  219 

for  analysis,  a  record  of  all  Government  requirements  and  cleared 
all  prospective  purchases.      Such   a   record   would   mean   only  that 

Electric  equipment — Continued. 

(c)  Condensers. 

(d)  Pumps. 

(e)  Compressors. 

(f)  Transformers. 

(fir)    Current  breakers. 

(ft)    Oil   switches. 

(i)    Lightning  arresters. 

(;)   Motors,  special,  machine  tool,  and  adjustable  speed,  direct-current,  and  crane. 

(fc)    Electrical  supplies. 
Electric  wire  ana  cable. 
Explosives  and  components  thereof. 
Felts. 
Fire  prevention  apparatus — 

(a)    Hand  fire  extinguishers. 

(6)    Fire  hose. 

Forging  and  machining  for  guns,  projectiles,  or  shafts. 
Hardware,  mill,  plumbers',  and  heating  supplies. 
Hides  and  skins. 
Iron  and  steel,  of  which  the  following  are  allocated  through  the  director  of  steel : 

(a)   Bands. 

(6)    Billets. 

(c)  Blooms. 

(d)  Boiler  tubes. 

(e)  Cold-rolled  steel. 

(f)  Hoops. 

(g)  Ingots. 

(h)    Merchant  bars. 

(i)    Pig  iron. 

U)    Pipe. 

(k)   Plates. 

(I)    Rails  and  accessories. 

(m)    Rods. 

(n)    Seamless  tubing. 

(0)  Shapes. 
(p)    Sheets. 

(q)    Sheet  bars. 

(r)   Sheet  steel. 

(s)   Skelp. 

(t)    Slabs. 

(u)    Tin  plate. 

(v)    Wire  and  wire  products, 

(w)    Wire  rope. 
Knit  goods. 

Leather  and  leather  goods. 
Linen  and  linen  thread. 
Lumber. 

Machine  guns  and   accessories    (cleared  through  Ordnance  Department,   United   States 
Army). 

Metal-working    machinery,    including    tools,    forge-shop    machinery,    and    plate-working 
machinery. 

Mica   (cleared  thorugh  Bureau  of  Supplies  and  Accounts,  United.  States  Navy). 

Needles. 

Nonferrous  metals  : 

(a)   Aluminum. 

(1)  Antimony. 

(c)  Copper. 

(d)  Lead.  » 

(e)  Zinc. 

(f)  Mercury    (cleared   through   Bureau   of   Supplies   and   Accounts). 

(g)  Nickel. 
(h)  Tin. 


220  HISTORY   OF   PRICES   DURING   THE   WAR. 

the  Government  knew  what  commodities  it  would  need,  and  had 
coordinated  all  of  its  purchases.  But  it  did  not  follow,  of  course, 
that  the  whole  or  any  of  industry  would  nicely  adjust  itself  so  as 
to  produce  or  to  deliver  commodities  in  precisely  the  order  which 
these  Government  requirements  demanded.  One  of  the  most  vital 
of  all  the  War  Industries  Board  controls  came  by  reason  of  its 
power  to  tell  the  industry  of  the  country  what  orders  should  have 
priority  in  production  and  what  in  delivery.  It  meant,  in  a  word, 
that  the  War  Industries  Board,  through  thousands  of  decisions, 
must  decide  the  relative  importance  of  services  and  of  commodities 
for  war  purposes.  The  determination  of  those  priorities  arose  in 
all  manner  of  ways  between  the  various  departments  of  the  Govern- 
ment; the  Allies;  the  Government  and  the  Allies;  the  Government 
and  individuals;  the  Allies  and  individuals;  and  as  between  par- 
ticular individuals.1  The  details  involved  in  the  administration"  of 
priorities  control  are  deserving  of  especial  and  technical  study  be- 
cause they  form  the  basis  of  almost  all  the  war-industry  controls  and 
bear  peculiarly  upon  prices. 

The  beginnings  of  control  through  the  issuance  of  priorities  ex- 
tended back  to  the  authorization  of  a  priority  subcommittee  by  the 
General  Munitions  Board  on  May  3,  1917.  The  director  of  the 
Council  of  National  Defense  briefly  and  pointedly  defined  the  func- 
tions of  priority  by  declaring  that  the  committee- 
shall  exercise  full  power  in  the  determination  of  priority  of  delivery  of  ma- 
terials and  finished  products  whenever  there  is  a  conflict  in  delivery  in  accord- 
ance with  the  general  policy  of  the  Government.  It  is  further  understood 

Oil: 

Castor  oil   (cleared  through  Signal  Corps,  United  States  Army). 
Linseed  oil. 

Optical  glass  and  optical  instruments. 

Paper,  100  per  cent  sulphate,  Kraft. 

Paper  and  paper  pulp. 

Power  equipment. 

Railway  equipment. 

Rubber. 

Rubber  goods. 

Silk  noil  and  silk  cartridge  cloth. 

Small  arms  (small-arms  ammunition)  cleared  through  Ordnance  Department,  United 
States  Army. 

Small  tools. 

Tobacco. 

Typewriters. 

Wool. 

Woolen  goods. 

1  It  would  be  amiss  to  omit  the  precise  wording  by  which  the  priorities  committee 
of  the  War  Industries  Board  later  defined,  over  and  again,  the  purpose  of  priorities  and 
the  method  of  determining,  them  :  The  paramount  purpose  of  priorities  is  the  selective 
mobilization  of  the  products  of  the  soil,  the  mines,  and  the  factories  for  direct  and  in- 
direct war  needs  in  such  a  way  as  will  most  effectually  contribute  toward  winning  the 
war.  In  requesting  priority  the  petitioner  should  join  with  the  committee  in  applying 
the  test:  To  what  extent,  if  at  all,  will  the  granting  of  this  application  contribute, 
directly  or- indirectly,  toward  winning  the  war;  and  if  at  all,  how  urgent  is  the  need. 


GOVERNMENT   CONTROL   OVER   PRICES.  221 

that  at  present  the  priority  committee  of  the  General  Munitions  Board  has 
no  power  in  regard  to  the  determination  of  priority  in  regard  to  civilian  needs 
in  which  the  Army  and  Navy  requirements  are  not  involved.  It  is  further 
understood  that  as  between  the  needs  of  our  Allies  and  our  civilian  popula- 
tion, the  priority  committee  of  the  General  Munitions  Board  for  the  present 
has  no  authority  to  act.  In  this  connection,  however,  the  priority  committee 
should  keep  full  information  as  to  such  cases  or  instances  as  come  to  its 
attention,  in  order  that  plans  may  further  be  developed  for  properly  handling 
the  matter. 

That  early  committee,  though  not  given  all  powers  which  were 
later  granted,  was  forced  upon  the  General  Munitions  Board  by 
reason  of  the  quantities  of  requests  from  manufacturers  and  con- 
tractors doing  Government  work  asking  which  orders  should  be 
filled  first.  Before  mid -summer  the  new  committee  was  receiving 
from  50  to  75  appeals  a  day  for  preference  policies.  But  the  real 
work  of  control  through  priorities  began  early  in  the  fall  of  1917, 
after  the  creation  of  the  War  Industries  Board,  and  with  the  ap- 
pointment of  Judge  Robert  S.  Lovett  to  priority  supervision.1 

Authority  for  priority  control. — Congress  seems  to  have  author- 
ized control  of  industry  through  the  issuance  of  priorities  more 
specifically  than  any  of  the  other  controls  exercised  by  the  War 
Industries  Board.  The  act  of  August  29,  1916,  said: 

That  a  Council  of  National  Defense  is  hereby  established  for  the  coordination 
of  industries  and  resources  for  the  national  security  and  welfare.  It  shall 
be  the  duty  of  the  Council  of  National  Defense  to  supervise  and  direct  inves- 
tigations and  make  recommendations  to  the  President  and  the  heads  of  execu- 
tive departments  as  to  the  location  of  railroads  with  reference  to  the  frontier 
of  the  United  States  so  as  to  render  possible  expeditious  concentration  of  troops 
and  supplies  to  points  of  defense;  the  coordination  of  military,  industrial,  and 
commercial  purposes  in  the  location  of  extensive  highways  and  branch  lines 
of  railroad;  the  utilization  of  waterways;  the  mobilization  of  military  and 
naval  resources  for  defense;  the  increase  of  domestic  production  of  articles 
and  materials  essential  to  the  support  of  armies  and  of  the  people  during  the 
interruption  of  foreign  commerce ;  the  development  of  sea-going  transportation ; 
data  as  to  amounts,  location,  method  and  means  of  production,  and  availability 
of  military  supplies ;  the  giving  of  information  to  producers  and  manufacturers 
as  to  the  class  of  supplies  needed  by  the  military  and  other  services  of  the 
Government,  the  requirements  relating  thereto,  and  the  creation  of  relations 
which  will  render  possible  in  time  of  need  the  immediate  concentration  and 
utilization  of  the  resources  of  the  Nation. 

That  legislative  authorization,  the  agreement  between  the  more 
important  Government  departments,2  the  various  resolutions  of  the 

1  Judge  Edwin  B.  Parker,  by  appointment  from  the  priorities  commissioner  Judge  Robert 
S.  Lovett,  was  put  in  active  charge  of  the  organization  of  the  new   committee  on  Aug. 
23,  1917.     After  Mar.  4,  1918,  Judge  Parker  succeeded  Judge  Lovett  as  priorities  com- 
missioner and  chairman  of  the  priorities  committee. 

2  The  President,   the  Secretary  of  War,   the  Secretary  of  Navy,  the   chairman   of  the 
United  States  Shipping  Board,  and  the  president  of  the  United   States   Shipping  Board 
Emergency    Fleet    Corporation   agreed    to   confer   upon    Judge   Lovett,    and   through    him, 
the  priorities   committee,   such  powers  of  priority  as  lay  within  their   legal   right.     The 
important  priority  circulars  were  signed  by  each  of  these  officials  except  the  President. 


222  HISTORY   OF   PRICES   DURING   THE   WAR. 

Council  of  National  Defense,1  and  the  President's  letter  of  March  4, 
1918,  declaring  that  one  of  the  six  functions  of  the  War  Industries 
Board  should  be — 

the  determination,  wherever  necessary,  of  priorities  of  production  and  of  deliv- 
ery and  of  the  proportions  of  any  given  agencies  when  the  supply  of  that  article 
is  insufficient,  either  temporarily  or  permanently, 

gave  an  abundance  of  war-time  authority  for  the  exercise  of  wide 
priority  powers. 

The  priority  circulars. — The  consideration  of  211,430  applica- 
tions 2  for  priority  in  production  or  delivery,  made  by  agencies  hav- 
ing war  needs,  was  a  highly  complicated  and  technical  business.  The 
priorities  committee  set  about  that  task  in  a  thoroughgoing  manner 
when  it  issued  priority  circular  No.  1  on  September  21,  1917,  giving 
general  directions  as  to  priority  and  outlining  the  method  of  apply- 
ing for  priority  assistance.  That  and  subsequent  circulars  attempted 
to  classify  and  rate  orders  in  accordance  with  their  relative  need  for 
war  and  national  purposes.3  The  first  circular  required  that1  a  rating 
of  orders  be  made  only  by  persons  producing  iron  and  steel  or  their 
products.  The  classes  of  producers  required  to  observe  priority 
rating  in  the  fulfillment  of  their  contract  orders  were  extended  grad- 
ually from  that  beginning  until  on  July  1,  1918,  the  well-known  cir- 
cular No.  4  was  issued  stating  that— 

during  the  war  in  which  the  United  States  is  now  engaged  all  individuals, 
firms,  associations,  and  corporations  engaged  in  the  production  of  raw  materials 
and  manufactured  products  (save  foods,  feeds,  and  fuels)  are  requested  to 
observe  regulations  respecting  priority.4 

The  War  Industries  Board  came  then  into  priority  control  over 
virtually  the  whole  industry  (not  already  controlled  by  the  Food 
Administration  and  Fuel  Administration)  of  the  country. 

The  method  of  rating. — The  priorities  committee,  in  order  that 
purchasers  and  producers  might  know  what  priority  to  follow,  di- 

*Note  especially  the  resolution  of  Sept.  25,  1917,  assigning  the  priorities  activities 
of  the  War  Industries  Board  of  the  Council  of  National  Defense  to  Judge  Lovett. 

2  A  large  number  of  applications  for  priority  assistance  were  handled  prior  to  Sept. 
21,   1917,  the  date  when  the  use  of  formal  application  blanks  and  formal   certificates 
was  begun.     The  first  priority  certificate  issued  was  dated  Sept.   25,  1917.      Since  that 
date   211,430    applications   have  been    received;    191,966    priority   certificates   have  been 
issued,  of  which,  however,  8,448  were  reissued  certificates  with  amended  ratings ;  27,912 
declinations  and  withdrawals  of  applications  were  issued.     The  highest  number  of  ap- 
plications received  and  numbered  in  one  day  was  1,901  on  July   8,  1918.     The  highest 
number  of  certificates  issued  in  one  day  was  2,121  on  Sept.  30,   1918.     Weekly  reports 
of  applications  received  and   certificates  issued   are  to   be  found   in  the  weekly   "  Office 
Review." 

3  In  order  to  get  the  system   satisfactorily   started  all  orders  which   had  been  placed 
prior  to  Sept.  21,  1917,  by  or  on  behalf  of  the  War  Department,  the  Navy  Department, 
or  the  United   States  Shipping  Board  Emergency   Fleet   Corporation   were   automatically 
rated  as  class  A-l  unless  otherwise  directed  ;  and,  likewise,  all  orders  for  military  sup- 
plies and  equipment  placed  by  or  for  the  Allies  as  class  A-2. 

4  There  were  in  all  issued  60  separate  priority  circulars  from  Sept.  21,  1917,  to  Dec. 
20,   1918,   extending  the   control   over   priorities.     Circular  No.   60,   issued  on  the  latter 
date,   revoked  as  of  Jan.  1,  1919,  all  rules,   regulations,  and  directions  of  every  nature 
issued  by  the  priorities  division. 


GOVERNMENT   CONTROL   OVER  PRICES.  223 

vided  all  orders  and  work  into  five  general  classes:  Class  AA,  class 
A,  class  B,  class  C,  and  class  D,  with  subdivisions  of  class  AA,  class 

A,  and  class  B,  indicated  by  suffix  number,  thus:  Class  AA-1,  class 
AA-2,  etc.;  class  A-l,  class  A-2,  etc.;  class  B-l,  class  B-2,  etc.1 
Orders  and  work  in  class  AA  took  precedence  of  orders  and  work  in 
all  other  classes ;  those  in  class  A  took  precedence  of  those  in  classes 

B,  C,  and  D ;  those  in  class  B  took  precedence  of  those  in  classes  C 
and  D;  those  in  class  C  took  precedence  of  those  in  class  D;  all 
irrespective  of  the  dates  the  orders  were  placed.    The  classification 
of  an  order  meant  that  it  should  be  given  such  precedence  over 
orders  of  a  lower  classification  as  were  necessary  (and  only  such  as 
were  necessary)  to  insure  delivery  on  the  date  specified  in  the  order. 
It  did  not  mean  that  work  should  cease  on  orders  of  a  lower  classi- 
fication, or  that  the  order  should  be  completed  and  delivery  made  in 
advance  of  orders  taking  a  lower  classification  if  this  was  not  neces- 
sary to  effect  delivery  within  the  time  specified.     Any  person  or 
agent,  entitled  to  preferential  treatment  under  the  policies  of  the 
priorities  committee,  ordinarily  made  application  to  the  committee 
for  an  order  running  against  a  manufacturer  or  distributor  and  call- 
ing for  delivery  by  a  certain  date.    The  priorities  committee,  if  im- 
pressed after  a  consideration  of  the  claim,  assigned  one  or  the  other 
of  the  above  ratings  to  the  order  and  issued  a  certificate.    This  cer- 
tificate was  issued  to  the  applicant  direct,  unless  otherwise  requested, 
and  not  to  the  person  against  whom  it  ran.     The  applicant  then 
presented  his  certificate  to  the  person  against  whom  it  ran,  and  the 
latter  arranged  his  production  program  to  give  delivery  to  that  pri- 
ority order  in  its  relative  turn  with  respect  to  other  priority  orders. 

Automatic  rating. — It  was  soon  found  that  certain  classes  of 
orders  so  obviously  deserved  preference,  that  a  priority  rating  could 
be  assigned  automatically.  A  scheme  of  automatic  classifications 
was  set  up  accordingly,  on  July  1,  1918,2  which  made  unnecessary 
any  application  for  certain  written  priority  certificates,  or  any  refer- 

1  Class  AA  comprised  only  emergency  war  work  of  an  exceptional  and  urgent  nature. 
Class  A   comprised   all   other  war  work ;   that  is  to  say,  orders  and  work   necessary 

to  carry  on  the  war,  such  as  arms,  ammunitions,  destroyers,  submarines,  battleships, 
transports,  merchant  ships,  and  other  water  craft,  airplanes,  locomotives. 

Class  B  comprised  orders  and  work  which,  while  not  primarily  designed  for  the  prosecu- 
tion of  the  war,  yet  were  of  public  interest  and  essential  to  the  national  welfare  or  other- 
wise of  exceptional  importance. 

Class  C  comprised  all  orders  and  work  not  covered  by  priority  certificates  issued  by 
the  priorities  committee  or  not  taking  an  automatic  rating,  which  orders  and  work  were 
to  be  utilized  in  furtherance  of  one  or  jnore  of  the  purposes  embraced  within  the  "  General 
classification  of  purposes  demanding  preference  treatment "  promulgated  by  the  pri- 
orities board,  or  which  orders  and  work  were  placed  by  or  utilized  in  connection  with 
an  industry  or  plant  appearing  on  preference  list  No.  1.  No  class  C  certificates  were 
issued. 

Class  D  comprised  all  orders  and  work  not  embraced  in  class  AA,  class  A,  class  B, 
or  class  C,  and  no  certificates  were  issued  therefor. 

2  See  sees.  7,  8,  9  of  priority  circular  No.  4. 


224  HISTORY  OF  PEICES   DURING  THE   WAR. 

ence  to  the  priorities  committee.  The  applicant  simply  attached  to 
his  order  an  affidavit  in  prescribed  form  setting  forth  the  facts  es- 
sential to  automatic  rating,  and  the  war  uses  for  which  materials 
were  needed. 

The  new  scheme  gave  no  automatic  rating  higher  than  A-4,  thus 
leaving  the  ratings  of  AA,  AA-1,  AA-2,  etc.,  A-l,  A-2,  A-3  to 
be  given  only  by  specific  action  of  the  Priorities  Committee.  All 
orders  by  the  War  Department,  the  Navy  Department,  or  the  Emer- 
gency Fleet  Corporation,  falling  within  class  A  were  automatically 
rated  A-5  upon  their  proper  signature  to  the  following  statement : 

Unless  rerated  by  express  order  in  writing  by  the  Priorities  Committee  of 
the  War  Industries  Board,  this  order  is  by  authority  of  said  Priorities  Com- 
mittee rated  as  class  A-5,  and  its  execution  shall  take  precedence  over  all  your 
orders  and  work  of  a  lower  classification  to  the  extent  necessary  to  insure 
delivery  according  to  the  date  specified  herein,  as  prescribed  by  Circular  No.  4, 
issued  by  the  priorities  division  of  the  War  Industries  Board,  of  date  July  1, 
1918,  and  all  amendments  thereto. 

There  was  set  forth  a  series  of  automatic  ratings  covering  all 
priorities  below  A^t,  which  gave  the  applicant,  when  an  affidavit 
was  attached  stating  that  materials  would  be  used  for  purposes 
having  the  specified  rating,  his  proper  precedence.1 

1  Circular  No.  4,  issued  July  1,  1918,  recognizes  the  following  purposes  which  may  take 
priority  rating  automatically  as  indicated : 

(a)  For  the  manufacture  of  turbines   (all  classes) A-4 

(b)  For  the  repair  or  construction  of  steam  railroad  locomotives  for  use  on  the 

railroads  under  the  jurisdiction  of  the  United  States  Railroad  Administra- 
tion  ,__. A-4 

(c)  For  the  production  of  electrodes A-5 

(d)  For  the  manufacture  of  rope  wire  and  of  wire  rope A— 5 

(e)  For  the  building  of  ships  or  other  water  craft  for  and  under  direct  contracts 

with  the  United   States  Shipping  Board,   Emergency   Fleet  Corporation A-5 

(f)  For  the  building  of  all  cargo  water  craft   (but  not  pleasure  craft)    save  such 

as  are  under  construction  by  or  for  the  United  States  Shipping  Board,  Emer- 
gency   Fleet    Corporation A-0 

(g)  For  the  manufacture  of  machine  tools  for  working  both  metal  and  wood ;  of 

machinists'  tools,  of  small  tools,  of  hand  tools,  and  of  mining  tools,  ma- 
chinery,   and    equipment A-6 

(h)  For  the  manufacture  of  steam  railroad  materials,  equipment,  and  supplies 
(other  than  locomotives),  for  use  on  the  railroads  under  the  jurisdiction 

of  the  United  States  Railroad  Administration B-l 

(i)   For  the  manufacture  of  locomotive  cranes  and  traveling  cranes B-l 

(;')   For   the   manufacture    of   electrical    equipment   other   than    turbines    (but   not 

electrical   supplies  as  distinguished  from  equipment) B-2 

(fc)   For  the  manufacture  of  farm  implements B-2 

(1)'  For   the  manufacture  of   textile   machinery B-2 

(m)  For  the  manufacture  of  tools,  implements,  machinery,  and  equipment  required 
for  the  production,  harvesting,  distribution,  milling,  canning,  and  refining 

of  foods  and   feeds B-2 

(n)   For  the  manufacture  of  binder  twine  and  rope B-2 

(o)  For  the  manufacture  of  oil-well  supplies  or  equipment,  by  which  is  meant 
supplies  for  the  production  of  petroleum  and  natural  gas,  but  not  includ- 
ing pipe  lines,  storage  tanks  of  1,000  barrels  capacity  or  over,  tank  cars, 

or    refineries B-2 

Each  order  for  materials,  equipment,  or  supplies  for  such  purposes  or  uses  as  fall 
within  class  C,  as  defined  by  the  priority  committee,  will  automatically  be  classed  as 
class  C ;  and  all  orders  save  such  as  are  automatically  classed  above  shall  be  automatically 
classed  as  class  D  unless  otherwise  provided. 


GOVERNMENT    CONTROL   OVER   PRICES.  225 

Unifying  priorities  in  production  and  those  In  delivery. — A  serious 
need  soon  developed  for  a  more  organized  attention  to  priorities 
in  delivery  such  as  had  already  been  given  to  priorities  in  pro- 
duction. It  was  found  that,  even  when  manufacturers  had  observed 
priority  policies  in  making  materials,  confusion  and  conflicts  within 
the  Government  were  delaying  the  deliveries  of  those  materials. 
The  President  in  his  letter  of  March  4,  accordingly,  suggested  the 
creation  of  a  Priorities  Board  within  the  priorities  division.  That 
board,  by  his  recommendation,  was  made  to  include  representatives 
from  the  various  Government  departments  in  order  that,  after  a 
priority  of  delivery  had  been  determined  upon,  there  might  be  "  com- 
mon, consistent,  and  concerted  action  to  carry  it  into  effect."  The 
priorities  division  was  then  composed  of  a  priorities  committee  and  a 
Priorities  Board,  the  latter  administering  the  policies  of  the  former. 
The  priorities  commissioner,  as  the  War  Industries  Board  member  in 
charge  of  the  priorities  division,  was  chairman  of  both  the  board  and 
the  committee.  The  committee  and  the  board  working  together,  after 
the  creation  of  the  latter  on  March  27,  1918,  effected  a  greater 
harmony  in  the  administering  of  priorities  over  production  and 
deliveries. 

Purposes  demanding  preferential  treatment.— A  very  important 
undertaking  of  the  Priorities  Board  was  its  issuance  on  March  27, 
1918,  of  a  general  classification  of  purposes  demanding  preferential 
treatment  for  the  guidance  of  agencies  in  the  production,  supply,  and 
distribution  of  raw  materials,  finished  products,  electrical  energy, 
fuel  and  transportation  by  rail,  water,  pipe  lines,  and  otherwise. 
That  list  gave  preference  to  the  raw  materials  going  into,  or  sup- 
plies necessary  to,  the  manufacture  of  ships,  aircraft,  munitions,  mili- 
tary and  naval  supplies  and  operations,  fuel,  food  and  collateral 
industries,  clothing,  railroads,  and  public  utilities.  These  were  the 
"  purposes  "  demanding  preference  treatment  and  were  made  known 
to  the  whole  Government.  The  issuance  of  ever  increasing  numbers 
of  priority  orders  had  long  since  made  the  problem  of  synchronizing 
priorities  within  the  Government  and  the  industry  an  involved  one. 
The  Priorities  Board,  by  drawing  into  its  deliberations  other  govern- 
mental departments  (Railroad  Administration,  Emergency  Fleet 
Corporation,  the  War  Trade  Board,  the  Fuel  Administration,  the 
Allied  Purchasing  ^Commission,  the  War  Labor  Policies  Board,  the 
Army,  and  the  Navy),  created  a  unit  to  administer  priority  orders, 
as  well  as  to  help  form  them.  The  cooperative  scheme  worked  with 
great  effectiveness,  for,  it  should  be  noted,  the  decisions  of  the  Prior- 
ities Board  so  organized  were  subject  to  review  only  by  the  chairman 
of  the  War  Industries  Board  and  by  the  President.  The  general 
classification  of  purposes  demanding  preference  treatment  made  by 
the  Priorities  Board,  and  its  later  similar  but  more  refined  preference 
12oci7°— 20 15 


22G  HISTORY   OF   PRICES   DURING  THE   WAR. 

lists,  went  a  long  way  toward  uniting  the  Government  and  the  indus- 
try upon  priority  policies. 

The  preference  lists. — A  list  of  45  industries  (more  commonly 
known  as  "  Preference  list  No.  1  ")  where  operations  were  deemed  of 
exceptional  importance  during  the  war,  was  drawn  up  by  the  Priori- 
ties Board  on  April  6,  1918.  The  list  was  made  for  the  guidance  of 
all  agencies  of  the  Government  in  the  supply  and  distribution  of 
coal  and  coke,  in  the  supply  of  transportation  by  rail  or  water,  and 
for  the  movement  of  coal  and  coke  to  those  industries.  The  scope  of 
that  list  was  extended  to  cover  73  industries.1  and  it  was  again  very 
much  broadened  by  "  Preference  list  No.  2,"  and  its  supplement  is- 
sued respectively  on  September  3  and  October  1,  1918. 

The  purpose  of  the  preference  list,  as  it  stood  at  the  signing  of  the 
armistice,  was  to  govern  the  Government  and  others  in  the  production 
and  supply  of  fuel  and  electric  energy  to  certain  necessary  industries ; 
in  the  supply  of  labor;  and  in  the  supply  of  transportation  service 
by  rail,  water,  pipe  lines,  or  otherwise.  The  preference  list,  includ- 
ing the  73  industries,  was  made  up  of  industries  entitled  to  preferen- 
tial treatment.  But  the  inclusion  of  those  industries,  .or  the  plants  on 
the  7,000  list,  did  not  operate  as  an  embargo  against  all  others.  The 
requirements  of  all  other  industries  and  plants  were  simply  deferred 
until  the  requirements  of  those  on  the  preference  list  were  satisfied. 
In  the  compilation  of  this  list,  industries  and  plants  were  divided 
according  to  their  relative  importance  into  four  classes,  viz,  Class  I, 
Class  II,  Class  III,  and  Class  IV.2 

*List  No.  2,  unlike  list  No.  1,  included  also  an  Individual  rating  for  about  7,000 
specific  plants.  This  departure  was  made  in  cases  where  it  seemed  that  particular 
plants  should  have  preference  even  though  the  industries  to  which  they  belonged  should 
not ;  or  where  particular  plants  deserved  a  higher  rating  than  that  given  their  industry. 
Each  of  these  plants  which  failed  to  file  a  monthly  report  of  its.  activities  was  dropped 
from  the  preference  list. 

2  Class  I. — Aircraft :  Plants  engaged  principally  in  manufacturing  aircraft  or  aircraft 
supplies  and  equipment.  Ammunition  :  Plants  engaged  principally  in  manufacturing  same 
for  the  United  States  Government  and  the  Allies.  Army  and  Navy :  Arsenals  and  navy 
yards.  Army  and  Navy:  Cantonments  and  camps.  Arms  (small):  Plants  engaged 
principally  in  manufacturing  same  for  the  United  States  Government  and  the  Allies. 
Blast  furnaces :  Producing  pig  iron.  Chemicals :  Plants  engaged  principally  in  manufac- 
turing chemicals  for  the  production  of  military  and  naval  explosives,  ammunition,  and 
aircraft,  and  use  in  chemical  warfare.  Coke :  Plants  engaged  principally  in  producing 
metallurgical  coke  and  by-products,  including  toluol.  Domestic  consumers :  Fuel  and 
electric  energy  for  residential  consumption,  including  homes,  apartment  houses,  resi- 
dential flats,  restaurants,  and  hotels.  Explosives  :  Plants  engaged  principally  in  manu- 
facturing same  for  military  and  naval  purposes  for  the  United  States  Government  and 
the  Allies.  Feed :  Plants  engaged  principally  in  preparing  or  manufacturing  feed  for 
live  stock  and  poultry.  Foods :  Plants  engaged  principally  in  producing,  miy^ng,  refining, 
preserving,  refrigerating,  wholesaling,  or  storing  food  for  human  consumption  embraced 
within  the  following  description  :  All  cereal  and  cereal  products,  meats  including  poultry, 
fish,  vegetables,  fruit,  sugar,  sirups,  glucose,  butter,  eggs,  cheese,  milk  and  cream,  lard, 
lard  compounds,  oleomargarine  and  other  substitutes  for  butter  or  lard,  vegetable  oils, 
beans,  salts,  coffee,  baking  powder,  soda,  and  yeast ;  also  ammonia  for  refrigeration. 
Gas :  See  oil  and  gas,  also  public  utilities.  Guns  (large)  :  Plants  engaged  principally 
in  manufacturing  same  for  the  United  States  Government  and  the  Allies.  Hospitals : 
See  Public  institutions  and  buildings.  Mines :  Coal.  Navy  yards :  See  Army  and  Navy. 


GOVERNMENT   CONTROL   OVER  PRICES.  227 

The  order  by  alphabetical  listing  has  no  significance,  but  all  in- 
dustries   and    plants    grouped   under    class    I   had   exceptional    im- 

Oil  and  gas  :  Plants  engaged  principally  in  producing  oil  or  natural  gas  for  fuel  or  for 
mechanical  purposes,  including  refining  or  manufacturing  oil  for  fuel,  or  mechanical  pur- 
poses. Oil  and  gas :  Pipe  lines  and  pumping  stations  engaged  in  transporting  oil  or 
natural  gas.  Public  institutions  and  buildings  (maintenance  and  operation  of)  :  Used  as 
hospitals  or  sanitariums.  Public  utilities. :  Gas  plants  producing  toluol.  Railways : 
Operated  by  United  States  Railroad  Administration.  Sanitariums  :  See  public  institutions 
and  buildings.  Ships  (maintenance  and  operation  of)  :  Excluding  pleasure  craft  not 
common  carriers.  Ships:  Plants  engaged  principally  in  building  ships,  excluding  (a) 
pleasure  craft  not  common  carriers,  (&)  ships  not  built  for  the  United  States  Govern- 
ment or  the  Allies  nor  under  license  from  the  United  States  Shipping  Board.  Steel- 
making  furnaces :  Plants  engaged  solely  in  manufacturing  ingots  and  steel  castings  by 
the  open-hearth,  Bessemer,  crucible,  or  electric  furnace  process,  including  blooming  mills, 
billet  mills,  and  slabbing  mills  for  same.  Steel-plate  mills.  Toluol :  See  coke  .also  public 
utilities. 

Class  II. — Brass  and  copper :  Plants  engaged  principally  in  rolling  and  drawing 
copper,  brass  and  other  copper  alloys  in  the  form  of  sheets,  rods,  wire,  and  tubes.  Coke : 
Plants,  not  otherwise  classified  or  listed,  producing  same.  Copper  and  brass  :  See  brass 
and  copper.  Cranes :  Plants  engaged  principally  in  manufacturing  locomotive  cranes. 
Ferro-alloys :  Plants  engaged  principally  in  producing  ferrochrome,  ferromanganese,  ferro- 
molybdenum,  ferrosilicon,  ferrotuugsten,  ferrouranium,  ferrovanadium,  and  ferrozir- 
conium.  Gas :  See  oil  and  gas.  Machine  tools :  Plants  engaged  principally  in  manu- 
facturing same.  Mines  :  Producing  metals  and  ferro-alloy  minerals.  "Navy  department : 
See  War  and  Navy  Departments.  Public  utilities :  Street  railways,  electric  lighting, 
and  power  companies,  gas  plants  not  otherwise  classified,  telephone  and  telegraph  com- 
panies, water  supply  companies,  and  like  general  utilities.  Public  utilities :  Plants  en- 
gaged principally  in  manufacturing  equipment  for  railways  and  other  public  utilities. 
Railways :  Not  operated  by  United  States  Railroad  Administration  (excluding  those  op- 
erated as  plant  facilities).  Rope  wire:  See  wire  rope.  Steel  rail  mills:  Rolling  rails 
50  or  more  pounds  per  yard.  War  and  Navy  Depatments :  Construction  work  con- 
ducted by  either  the  War  Department  or  the  Navy  Department  of  the  United  States 
in  embarkation  ports,  harbors,  fortified  places,  flood  protection  operations,  docks,  locks, 
channels,  inland  waterways,  and  in  the  maintenance  and  repair  of  same.  Wire  rope  and 
rope  wire :  Plants  engaged  principally  in  manufacturing  same. 

Class  III. — Buildings :  See  public  institutions  and  buildings.  Chain  :  Plants  engaged 
principally  in  manufacturing  iron  and  steel  chain.  Cranes :  Plants  engaged  principally 
in  manufacturing  traveling  cranes.  Domestic  consumers :  Fuel  and  electric  energy  not 
otherwise  specifically  listed.  Electrical  equipment :  Plants  engaged  principally  in  manu- 
facturing same.  Explosives :  Plants,  not  otherwise  classified  or  listed,  engaged  principally 
in  manufacturing  same.  Foods  :  Plants  engaged  principally  in  producing,  milling,  prepar- 
ing, refining,  preserving,  refrigerating,  or  storing  foods  for  human  consumption  not  other- 
wise specifically  listed  (excepting  herefrom  plants  producing  confectionery,  soft  drinks, 
and  chewing  gum).  Gns :  See  oil  and  gas.  .  Ice:  Plants  engaged  principally  in  manu- 
facturing same.  Mines :  Plants  engaged  principally  in  manufacturing  mining  tools  or 
equipment.  Oil  and  gas :  Plants  engaged  principally  in  manufacturing  equipment  or 
supplies  for  producing  or  transporting  oil  or  natural  gas,  or  for  refining  and  manu- 
facturing oil  for  fuel  or  for  mechanical  purposes.  Public  institutions  and  buildings 
(maintenance  and  operation  of)  :  Other  than  hospitals  and  sanitariums.  Steel :  All  plants 
operating  steel  rolling  and  drawing  mills,  exclusive  of  those  taking  higher  classification. 
Tin  plates :  Plants  engaged  principally  in  manufacturing  same.  Tools :  Plants  engaged 
principally  in  manufacturing  small  or  hand  tools  for  working  wood  or  metal. 

Class  IV. — Agricultural  implements  :  See  farm  implements.  Bags — hemp,  jute,  cotton  : 
Plants  engaged  principally  in  manufacturing  same.  Boots  and  shoes :  Plants  engaged 
exclusively  in  manufacturing  same.  Chemicals :  Plants,  not  otherwise  classified  or  listed, 
engaged  principally  in  manufacturing  chemicals.  Cotton :  Plants  engaged  in  the  com- 
pression of  cotton.  Cotton  textiles  :  See  textiles.  Drugs — medicines  and  medical  and 
surgical  supplies :  Plants  engaged  principally  in  manufacturing  same.  Farm  imple- 
ments :  Plants  engaged  principally  in  manufacturing  agricultural  implements  and  farm 
operating  equipment.  Fertilizers :  Plants  engaged  principally  in  producing  same.  Fire 
brick  :  Plants  engaged  principally  in  manufacturing  same.  Food  containers :  Plants  en- 
gaged principally  in  manufacturing  same.  Foundries  (iron)  :  Plants  engaged  principally 
in  the  manufacture  of  gray  iron  and  malleable  Iron  castings.  Insecticides  and  fungicides : 
Plants  engaged  principally  in  manufacturing  same.  Laundries.  Newspapers  and  periodi- 


228  HISTORY    OF   PRICES   DURING   THE   WAR. 

portance  in  connection  with  the  prosecution  of  the  war.  Their  re- 
quirements were  fully  satisfied  in  preference  to  those  of  the  three 
remaining  classes.  Requirements  of  industries  and  plants  grouped 
under  class  II,  class  III,  and  class  IV  had  precedence  over  those  not 
appearing  on  the  preference  list.  As  between  these  three  classes, 
however,  there  was  no  complete  or  absolute  preference.  The  division 
into  classes  was  for  the  purpose  of  presenting  a  composite  picture  of 
the  relative  importance  of  the  industries  and  plants  embraced  within 
each  group.  It  was  not  intended  that  the  requirements  of  class  II 
should  be  fully  satisfied  before  supplying  any  of  the  requirements  of 
class  III  or  that  those  of  class  III  should  be  fully  satisfied  before 
supplying  any  of  those  of  class  IV. 

War-industry  controls  center  about  priorities. — The  widest  of  all 
the  controls  extended  over  industry  by  the  War  Industries  Board 
was  that  which  it  got  by  determining  for  industry  what  priority 
should  be  given  all  war  orders  both  in  production  and  in  delivery. 
The  other  kinds  of  control  exercised,  indeed,  led  into  priorities  con- 
trol. It  came  to  be  the  strongest  weapon  in  the  hands  of  the  Gov- 
ernment for  enforcing  its  industrial  control  rules.  The  Government, 
through  the  War  Industries  Board,  estimated  its  requirements  and 
made  clearances  for  war  purchases.  But  those  actions  really  did  no 
more  than  pave  the  way  to  control.  They  did  not  generally  reach 
beyond  the  walls  of  the  Government.  They  enabled  a  single  agent 
of  the  Government  to  say  what  the  war  would  require  from  all  in- 
dustry and  when.  The  so-called  requirement  and  clearance  controls 
simply  opened  a  way,  then,  if  there  appeared  a  shortage,  for  the 
board  to  allocate  the  war  orders  to  the  trade,  to  curtail  certain  in- 
dustries and  to  conserve  nonessential  production.  But  these  potent 
controls,  it  should  be  emphasized,  all  tied  directly  into  the  control 
over  priorities,  for  by  determining  priorities,  in  a  large  way,  the 
War  Industries  Board  enforced  .them.  It  seems  doubtful  whether 
any  other  control  during  the  war,  amid  the  confusion  and  conflict 
of  orders  within  the  Government  and  out,  introduced  a  scheme  so 
powerful  in  its  effects  toward  synchronizing  production  and  deliv- 
eries for  war  ends. 

cals :  Plants  engaged  principally  in  printing  newspapers  or  periodicals  which  are  entered 
at  the  post  office  as  second-class  mail  matter.  Paper  and  pulp  :  See  pulp  and  paper. 
Periodicals :  See  newspapers  and  periodicals.  Pulp  and  paper  :  Plants  engaged  exclusively 
in  manufacturing  same.  Rope  :  See  twine  and  rope.  Soap :  Plants  engaged  principally 
in  manufacturing  same.  Surgical  supplies:  See  drugs  and  medicines.  Tanners:  Plants 
engaged  principally  in  tanning  leather.  Tanning :  Plants  engaged  principally  in  manu- 
facturing tanning  extracts.  Toxtiles  :  Plants  engaged  principally  in  manufacturing  cotton 
textiles,  including  spinning,  weaving,  and  finishing.  Textiles :  Plants  engaged  principally 
in  manufacturing  woolen  textiles,  including  spinners,  top  makers,  and  weavers.  Textiles  : 
Plants  engaged  principally  in  manufacturing  cotton  or  woolen  knit  goods.  Textiles  : 
Plants  engaged  principally  in  manufacturing  textile  machinery.  Tobacco :  Only  for 
preserving,  drying,  curing,  packing,  and  storing  same — not  manufacturing  and  marketing. 
Twine  (binder)  and  rope:  Plants  engaged  principally  in  manufacturing  same.  Woolen 
textiles  :  See  textiles. 


GOVERNMENT    CONTROL   OVER   PRICES.  229 

This  powerful  scheme,  permitting  the  Government  at  any  moment 
to  check  the  production  of  a  less  essential  commodity  for  a  more 
essential  one,  gave  it  an  effective  instrument  to  control  prices. 
Priorities,  of  course,  were  not  designed  or  ever  issued  specifically 
to  "  peg  "  prices.  But,  for  all  that,  in  a  very  real,  though  indirect, 
way  they  did  affect  prices  to  greater  and  lesser  extents.1  Threats 
of  a  shortage  in  a  basic  material  ordinarily  provokes  confusion  and 
soaring  prices,  and  opens  the  door  to  competitive  bidding  for  priority. 
Those  bid  prices  are  made  in  war  time  with  less  regard  to  the  actual 
cost  of  production  than  to  the  cost  of  purchasing  priorities  in  pro- 
duction and  delivery  under  an  abnormal  condition.  But  the  priority 
policies  announced  to  the  country  that  it  could  not  at  any  price 
purchase  priorities  either  in  production  or  deliveries.  Priorities, 
it  came  to  appreciate,  were  determined  and  controlled  by  the  Govern- 
ment solely  for  war  ends.  While  the  priorities  system  was  not  an 
instrument  for  the  fixing  of  prices,  the  stabilizing  effects  of  priorities 
control  upon  prices  were  not  less  powerful  because  there  is  no  way 
in  which  they  can  be  measured. 

ALLOCATIONS. 

All  of  the  relations  which  allocation  bore  to  price  control  are 
covered  in  a  study  of  the  Government  requirements,  the  clearance 
list,  and  priorities.  The  allocation  of  Government  requirements,  or 
clearances,  meant  simply  their  distribution  to  particular  industries 
and  firms  for  fulfillment.  The  requirements  division,  after  clearing 
all  of  the  prospective  purchases  of  the  Government,  forwarded  a 
record  of  those  immediate  needs  to  the  proper  commodity  section 
chiefs.  The  commodity  chief  and  his  staff,  after  determining 
whether  there  was  a  shortage  of  the  commodity  required,  either  al- 
located the  order  or  returned  it  without  restriction.  The  Govern- 
ment department,  from  which  the  order  asking  for  privilege  to  pur- 
chase had  originally  come,  if  there  was  no  shortage,  could  buy  its 
goods  in  the  open  market  without  restriction.  But,  where  the  com- 
modity section  had  found  a  shortage,  the  section  itself  allocated  the 
order  to  various  parts  of  the  industry  or  firms  before  returning  it. 
Allocation,  obviously,  was  not  a  separately  administered  function  of 
any  division  of  the  War  Industries  Board  as  were  most  of  the  other 
controls.  It  was  really  a  principle  of  procedure,  commonly  followed 
by  all  of  the  commodity  sections,  designed  properly  to  distribute  the 
burden  or  fruit  of  certain  Government  orders.  It  pertained  only  to 
purchases  of  those  commodities  in  which  a  shortage  threatened. 

lrFhe  War  Industries  Board  goes  so  far  as  to  write  into  its  final  report  that  "war 
prices  were  high  prices,  but  they  were  stabilized  prices.  The  most  effective  organ  of 
stabilization  was  the  operation  of  the  priorities  system." 


230  HISTORY  OF  PEICES  DURING  THE  WAR. 

CURTAILMENTS. 

Curtailment  was  commonly  administered  by  various  units  within 
the  War  Industries  Board  when  an  extremely  serious  shortage 
threatened.  The  production  of  certain  less  essential  commodities  was 
cut  off  or  curtailed  to  make  way  for  the  production  of  allocated  and 
other  orders.  The  administration  of  priorities  was  one  of  the  most 
effective  instruments  of  curtailment,  and  the  material  for  a  study  of 
curtailment  falls  largely  in  that  chapter.  The  curtailment  of  all  or 
any  part  of  an  industry,  because  much  more  sweeping  and  heartless 
than  its  conservation,  was  a  program  entered  upon  with  far  more 
caution.  An  Industrial  Adjustment  Committee,  composed  of  repre- 
sentatives from  the  War  Industries  Board,  the  War  Trade  Board, 
the  Food  Administration,  the  Fuel  Administration,  the  United  States 
Shipping  Board,  the  War  Labor  Policies  Board,  and  the  Treasury 
Department,  was  appointed  upon  the  approval  of  the  President  to 
form  a  plan  for  the  safe  but  systematic  curtailment  of  nonessential 
industries.  That  committee,  after  permitting  the  industries  affected 
a  hearing,  determined  upon  curtailment  policies  which  would  effect 
equitable  reductions  without  killing  the  industry.  The  actual  ad- 
ministration of  all  curtailment  programs,  as  were  those  for  conserva- 
tion, was  put  into  the  hands  of  the  commodity  sections  of  the  War 
Industries  Board. 

CONSERVATION. 

The  War  Industries  Board,  after  balancing  roughly  the  Govern- 
ment and  civilian  demands  against  supplies,  found,  in  the  main,  that 
the  threatened  shortages  could  be  met  adequately  without  absolute 
curtailment  by  so-called  conservation  programs.  The  conservation 
of  a  supply,  as  distinguished  from  cutting  it  off  or  curtailing  it, 
meant  simply  spreading  its  use  out  thinner.  The  board,  under  its 
conservation  division,1  studied  carefully  the  industries  which  were 
not  strictly  serving  the  war  requirements  and  set  itself  to  eliminate 
their  wastes  and  turn  their  available  materials  to  the  best  war  uses. 
The  purpose  of  conservation  was,  by  means  of  substitution,  conserva- 
tion or  standardization  to  give  the  military,  naval  and  shipping 
agencies  of  the  war  machine  exactly  what  they  required  for  full 
effectiveness.  It  was  the  business  of  the  War  Industries  Board,  with 
all  war  demands  coming  under  its  eye,  to  introduce  schemes  of  effi- 
ciency for  the  proper  coordination  of  supply  and  demand. 

1  The  conservation  division  of  the  War  Industries  Board  was  created  May  9,  1918, 
to  carry  on  the  work  commenced  on  Mar.  24,  1917,  by  the  commercial  economy  board 
under  the  Council  of  National  Defense.  The  function  of  the  new  division,  as  outlined 
by  the  President  in  his  letter  of  Mar.  4,  was  "the  studious  conservation  of  resources 
and  facilities  by  means  of  scientific,  industrial,  and  commercial  economies." 


GOVERNMENT   CONTROL   OVER  PRICES.  231 

« 

Conservation  measures  were  effected,  outside  the  Government  and 
in,  by  the  strictest  cooperation  with  the  industry  through  the  various 
war-service  committees  and  by  technical  advice  and  consultation  with 
the  Government  war-making  agencies.  Those  measures  scarcely  per- 
mit of  a  tangible  analysis  because  of  their  number  and  their  variety. 
Conservation,  however,  was  generally  effected  by  securing  a  maxi- 
mum reduction  in  the  number  of  styles,  varieties,  sizes,  colors,  or 
finishes  of  the  product;  eliminating  the  number  of  styles  and  varie- 
ties that  took  more  than  the  amount  of  material  strictly  necessary 
(as,  for  example,  restricting  the  length  and  sweep  of  overcoats) ; 
eliminating  features  or  accessories  which  used  materials  for  adorn- 
ment or  convenience  but  which  were  not  essential  to  the  utility  of  the 
product;  eliminating  patterns  and  types  of  products  which  were  less 
essential  to  the  civilian  needs;  substituting  materials  which  were 
plentiful  in  the  place  of  those  which  were  not  plentiful  and  were 
needed  for  the  war  program  (for  example,  zinc  was  substituted  for 
steel  and  other  metals) ;  discontinuing  the  use  of  certain  materials 
for  unnecessary  purposes  (such  as  caustic  soda  in  the  manufacture 
of  automobile  tires) ;  standardizing  sizes,  lengths,  widths,  weights, 
thicknesses,  and  gauges  of  materials,  parts  and  sections ;  reducing  the 
excessive  waste  of  materials  in  manufacturing  processes  (such  as 
chrome  chemicals  in  certain  branches  of  the  leather-tanning  indus- 
try) ;  securing  economy  in  samples  used  for  selling  products;  secur- 
ing economy  in  containers  by  eliminating  boxes  or  cartons  which  re- 
quired excessive  shipping  space  (as,  for  example,  eliminating  small 
sizes  of  containers) ;  securing  economy  in  packing  by  increasing  the 
number  of  units  per  package. 

Under  this  general  scheme,  the  board  made  conservation  rules 
applicable  to  various  industries  and,  before  putting  them  into  effect, 
asked  each  industry  for  technical  advice  upon  them.  Once  adopted, 
the  enforcement  of  each  conservation  program  was  left  for  adminis- 
tration to  the  proper  commodity  chief. 

No  adequate  analysis  can  ever  be  made  to  cover  in  full  the  extent 
of  saving  which  each  of  the  conservation  programs  effected.  A  com- 
prehension in  general  of  the  more  specific  programs  undertaken, 
however,  is  vital  because  of  its  bearing  upon  price  control.  The 
programs,  in  each  case,  were  addressed  by  necessity  to  the  industries 
themselves  through  the  War  Industries  Board,  since  there  was  no 
means  of  effective  enforcement  other  than  the  enlistment  of  their 
cooperation.  The  more  important  of  the  programs  were  those  in- 
tended to  conserve  materials  within  the  agricultural  implement, 
automobile  tire,  barrel  goods,  bedding,  bicycle,  book  cloth,  bottle, 
boys'  clothing,  camera,  chain,  chandelier,  chinaware,  clock,  compo- 
sition roofing,  corset,  delivery  service,  electric  appliance,  fabric 
glove,  felt  shoe,  furnace,  furniture,  gas  range,  hand  stamp  and  mark- 


232  HISTORY   OF   PRICES  DURING   THE   WAR. 

ing  device,  hardware,  harness  and  saddlery,  hosiery  and  underwear, 
household  wringer,  leather  glove,  mackinaw,  men's  clothing,  metal 
bedstead,  motorcycle,  moving-picture  machine,  office  appliance,  oil 
refining,  oil  storage  tank  and  pump,  oil  stove  and  heater,  optical 
goods,  overall,  paint,  pencil,  plumbing  supply,  radiator,  railroad 
machinery,  range,  refrigerator,  rubber  clothing,  rubber  footwear, 
rubber  goods,  safe  and  vault,  shoe,  steel  pen,  steel  pipe,  stove,  straw 
hat,  sweater,  talking  machine,  thread,  tin,  tin  plate,  traveling  bag, 
trunk,  typewriter  ribbon,  vacuum  cleaner,  vehicle,  waist,  washing 
machine,  weather-strip,  wholesale  dry  goods,  wooden  container,  wool 
felt  hat,  and  women's  clothing  industries. 

The  conservation  program,  put  well  underway  by  the  War  In- 
dustries Board  before  the  end  of  the  war,  was  a  big  and  compre- 
hensive one.  It,  like  the  priority  program,  had  a  very  vital  though 
a  very  intangible  bearing  upon  the  price  level.  The  stabilizing  effect 
of  the  one  upon  prices  is  as  impossible  to  measure  as  the  other.  But 
the  conservation  schedules  introduced  into  various  industries,  while 
generally  of  a  less  potent  influence  upon  prices  than  the  priority 
certificates,  must  be  taken  into  account  in  an  analysis  of  price  control. 
Conservation,  by  turning  materials  into  strictly  essential  industry 
and  spreading  their  uses  out  thinner,  helped  to  postpone  the  shortage 
point  and  stave  off  higher  rises  in  price, 

PRICES. 

The  War  Industries  Board  was  not  a  price-fixing  agency  strictly 
speaking,  but  it  did  undertake  a  wide  range  of  formal  and  informal 
price  controls  through  agreements  with  the  industry.  The  creation 
of  the  price-fixing  committee  in  March,  1918,  relieved  the  board 
proper  of  the  further  administration  of  virtually  all  its  important 
price-fixing  work,  though  it  did  afterwards  exercise  some  price 
control.  The  peculiar  relation  of  the  War  Industries  Board  and 
the  price-fixing  committee  and  the  difficulties  of  separating  clearly 
their  controls  make  it  advisable  to  divide  the  discussion  of  what 
these  two  organizations  did  in  regulating  prices.  A  statement  of 
individual  price  regulations  undertaken  by  the  War  Industries  Board 
is,  therefore,  postponed  until  after  the  general  discussion  of  the  work 
of  the  price-fixing  committee. 


5.  THE  PRICE  FIXING  COMMITTEE. 

There  was  not,  during  the  last  seven  months  of  war,  any  other 
agency  of  the  Government  at  Washington  so  strictly  giving  its 
whole  attention  to  the  business  of  fixing  prices  as  the  price  fixing 
committee.  The  President  had  come  to  believe  in  the  necessity  of 
systematic  methods  of  determining  the  great  basic  raw-material 
prices,  and  on  March  4,  1918.  wrote  asking  that  price  determination 
problems  be  transferred  from  the  War  Industries  Board  to  a  special, 
independent  committee.  That  action  came  long  after  the  Food  Ad- 
ministration had  assumed  control  over  food  prices,  and  the  Fuel  Ad- 
ministration control  over  fuel  prices.  It  marked  a  clear  break  with 
earlier  methods  of  price  control,  though  not  necessarily  with  earlier 
policies,  and  was  the  longest  stride  toward  a  somewhat  organized 
price  fixing  that  was  taken. 

The  new  price  fixing  committee,  created  too  late  to  formulate  the 
initial  price  policies  upon  many  of  the  basis  materials,  grew  week 
by  week,  through  revisions  of  earlier  policies  and  the  initiation  of 
new  controls,  into  a  direct  responsibility  for  the  majority  of  all 
general  fixed  prices.1  To  understand  the  committee's  work  it  is 
necessary  to  know  how  the  price  fixing  committee  was  organized, 
what  basis  of  power  it  had  to  fix  prices  at  all,  the  sphere  of  its  ac- 
tivity within  the  Government,  the  character  of  price  agreements  en- 
tered into  by  it,  the  price  policies  which  the  committee  worked  out, 
and  how  it  enforced  its  price  regulations. 

(i)    ORGANIZATION   OF  THE  COMMITTEE. 

The  price  fixing  committee,  created  under  the  authority  of  the 
President's  letter  to  Mr.  Bernard  M.  Baruch,  dated  March  4,  1918, 
was  made  up  of  a  chairman,  a  representative  of  the  War  Department, 
a  representative  of  the  Navy  Department,  a  representative  of  the  Fuel 
Administration,  a  representative  of  the  Tariff  Commission,  a  repre- 
sentative of  the  Federal  Trade  Commission,  the  labor  representative 
of  the  War  Industries  Board,  and  the  chairman  of  the  War  Industries 
Board  ex  officio.2  This  committee,  appointed  by  the  President,  was 

1  The  first  meeting  of  the  price  fixing  committee  was  held  in  the  War  Industries  Board 
on  Mar.   14.   1918. 

2  The  organization"  in  full  of  the  price  fixing  committee  at  the  time  the  armistice  was 
signed  was  as  follows:   Robert  S.  Brookings,   chairman;   Bernard  M.   Baruch,   chairman 
of  the  War   Industries  Board  ex  officio  ;   F.  W.  Taussig,   chairman  United   States  Tariff 
Commission  ;  W.  B.  Colver,  chairman  Federal  Trade  Commission  ;  H.  A.  Garfield,  United 
States  Fuel  Administrator ;    Hugh   Frayne,   labor  representative  of   the   War   Industries 
Board ;  Commander  John  M.  Hancock,  representing  the  Department  of  Navy  ;  Lieut.  Col. 
Robert  H.  Montgomery,  representing  the  Department  of  War ;    Henry  C.   Stuart,   repre- 
senting the  Department  of  Agriculture ;  and  W.  W.  Phelps,  secretary. 

233 


234  HISTORY  OF  PRICES  DURING  THE   WAR. 

called  together  by  the  War  Industries  Board  for  its  first  meeting, 
and  by  them  given  its  original  general  instruction.1  This  quasi- 
judicial  committee  thereafter,  whether  in  regular  executive  session 
or  in  conferences  with  the  trade,  sat  at  times  almost  continuously 
in  the  Council  of  National  Defense  Building. 

It  is  not  precise^  accurate  to  say  that  the  price  fixing  committee 
was  either  independent  of  the  War  Industries  Board  or  that  it  was 
a  subsidiary  part  of  the  board.  Not  to  the  very  last  were  it  and  the 
board  agreed  concerning  the  place  of  the  committee  in  the  War  In- 
dustries Board  organization.  The  President,  in  reorganizing  the 
board  on  March  4,  1918,  had  provided  for  the  creation  of  a  price- 
fixing  committee  in  the  same  letter  by  which  he  outlined  the  func- 
tions of  the  board  and  appointed  Mr.  Bernard  M.  Baruch  its  chair- 
man. The  board,  after  the  appointment  of  the  committee,  formally 
marked  out  a  set  of  policies  for  the  committee,  and  its  chairman 
called  together  the  committee  for  their  first  meeting  and  told  them 
their  function.  The  chairman  of  the  board,  indeed,  and  another 
member  were  made  members  of  the  committee.  The  committee  took 
over  formally  the  fixing  and  revision  of  many  prices  already  con- 
sidered by  the  board  and  worked  hand  in  glove  with  it.  The  com- 
mittee announcements  were  printed  as  from  the  price  fixing  com- 
mittee of  the  War  Industries  Board.  But  there  was  no  real  authority 
which  the  board  held  over  the  committee. 

The  President  in  his  letter  specifically-  took  price  determination 
from  the  board  and  gave  it  to  a  separate  committee,  and  he,  inde- 
pendent of  the  board,  named  the  members  of  the  price  fixing  com- 
mittee. The  committee  considered  itself  responsible  directly  to  the 
President  and,  irrespective  of  the  board,  made  its  reports  to  him.2 
It  was  the  President,  not  the  board,  who  approved  all  prices  fixed 
and  made  them  official. 

1  The  functions  of  the  price  fixing  committee  as   determined  by   the  War  Industries 
Board,  earlier  that  day,  and  delivered  to  the  committee,  were  as  follows:    (1)   To  advise 
upon   prices  of  basic   materials;    (2)    from   time  to   time  to   advise  as   to  general    price 
policies,  acting  in  this  way  as  a  coordinating  price  body  ;   (3)    the  committee  will  advise 
when  requested  by  any  department  upon  a  specific  contract,  assuming,  however,  that  no 
department  will  submit  for  advice  those  problems  which   it   is  organized   and   qualified 
to  handle  itself;  and    (4)   when  materials  are  commandeered  prices  of  the  same  will  be 
fixed  by  this  committee. 

2  Mr.   Robert  S.   Brookings,    chairman  of  the   price   fixing  committee,  in   a   conference 
held  with  the  copper  industry  as  late  as  July  2,  1918  (price  fixing  committee  minutes  for 
that  day,   p.   433),  said:    "The  facts  are,   we  represent  the  President  absolutely.      Our 
appointment,   while  we  are  a  part  of  the  War  Industries  Board,  is  absolutely   separate 
and  distinct ;   we  have  absolutely  separate  and  distinct  obligations^    *     *     *     We  sub- 
mit these  things  to  him  (President)   for  approval  when  they  involve  a  change,  or  when 
there  is  anything  to  approve  ;  in  fact,   we  go  into  detail  sometimes  more  than  I  think 
he  cares  to  have  it,  because  we  have  reason  to  know  that  when  it  comes  to  exercising 
a   far-reaching   judgment,    especially    where   it   involves   the    Nation,    he   frequently    has 
suggestions  to  make." 


GOVERNMENT   CONTROL   OVER  PRICES.  235 

(2)  THE  BASIS  OF  POWER  TO  FIX  PRICES. 

After  what  has  already  been  said  about  the  legal  basis  of  the 
powers  exercised  by  the  War  Industries  Board  at  large,  it  will  not  be 
surprising  to  find  that  the  legal  basis  of  the  price  fixing  committee's 
work  was  somewhat  indefinite.  This  committee,  though  deter- 
mining a  far  wider  range  of  prices  than  either,  had  only  a  fraction 
of  legal  power  by  comparison  with  its  sister  price-determining 
agencies,  the  Food  Administration  and  the  Fuel  Administration.  No 
specific  statute  could  be  quoted  as  its  authority  for  deciding  what 
prices  should  be.  That  fact,  beyond  doubt,  somewhat  circumscribed 
its  method  of  price  fixing,  if  not  the  extent,  and  made  the  committee 
fix.  prices  almost  altogether  by  agreements  with  the  producers. 

THE  THREATS  OF  REQUISITIONING  AND  COMMANDEERING. 

But,  if  there  was  no  law  to  which  the  price  fixing  committee  might 
turn  for  making  its  decrees  effective,  there  were  other  less  direct  yet, 
in  war  time,  equally  powerful  weapons.  Foremost  among  these,  as 
all  producers  knew,  were  the  well-nigh  absolute  rights  to  requisition 
goods  or  place  commandeering  orders  with  plants  for  supplies. 
True,  neither  of  those  powers  was  open  to  the  Government  for  other 
than  its  own  needs,  but  there  could  scarcely  have  been  made  a  more 
satisfactory  resort  for  war  times.  The  latent  power,  given  to  the 
President  by  authority  of  the  food  control  act  and  the  national 
defense  act,  under  which  virtually  all  Government  requisitioning  and 
commandering  were  done  respectively,  enable  the  price  fixing  com- 
mittee in  substance  to  tell  producers :  v 

These  are  the  prices  to  which  the  Government  will  agree;  if  you  are  willing 
to  enter  into  a  voluntary  arrangement  with  us,  you  will  be  paid  these  prices  for 
your  goods,  but  if  you  refuse  to  do  so,  we  will  be  compelled  to  ask  the  properly 
constituted  authorities  to  commandeer  your  output  or  your  plant  and  give  you 
just  compensation  therefor  as  provided  by  statute.1 

The  food  control  act  (H.  R.  4961,  Public  No.  41),  approved  August 
10,  1917,  was  the  law  which  authorized  the  requisitioning  of  certain 
existing  properties  for  the  support  either  of  the  Army,  Navy,  or  any 
other  public  use.  It  provided  in  section  10 : 

That  the  President  is  authorized,  from  time  to  time,  to  requisition  foods, 
feeds,  fuels,  and  other  supplies  necessary  to  the  support  of  the  Army  or  the 
maintenance  of  the  Navy,  or  any  other  public  use  connected  with  the  common 
defense,  and  to  requisition,  or  otherwise  provide,  storage  facilities  for  such 
supplies ;  and  he  shall  ascertain  and  pay  a  just  compensation  therefor. 

This  act,  which  was  really  the  basis  for  all  Government  requisition- 
ing of  subsistence  supplies  for  the  Army  during  the  war,  pertained 

1The  legal  section  of  the  War  Industries  Board  on  June  11,  1918,  prepared  a  memo- 
randum in  which  it  concluded  that  a  threat  to  commandeer  expressed  in  the  above  form, 
and  made  to  enforce  the  fixing  of  a  certain  price  does  not  constitute  duress. 


236  HISTORY   OF   PRICES   DURING   THE   WAR. 

only  to  foods,  feeds,  and  fuel  and  was  not,  therefore,  of  so  much  value 
to  the  price  fixing  committee  as  the  national  defense  act. 

The  national  defense  act  (H.  E.  12766,  Public  Xo.  85),  approved 
June  3,  1916,  authorized  the  Secretary  of  War  to  determine  reason- 
able prices  for  military  supplies  and,  upon  failure  of  compliance, 
gave  the  President  power  to  take  over  any  .plant.  This  act,  which 
was  the  one  giving  authority  for  the  commandeering  of  output,  made 
it  possible  to  place  with  any  manufacturing  establishment  a  compul- 
sory order  for  the  production  of  any  manufacture  usually  produced 
by  the  firm.  The  Government  could,  thus,  by  the  payment  of  a  just 
compensation,  require  or  commandeer  the  whole  output  of  a  plant  and 
itself  determine  the  price  to  be  paid  for  everything  taken  under  com- 
pulsory order.  This  possibility,  in  so  far  as  the  price  fixing  committee 
had  a  legal  weapon,  was  the  most  formidable  weapon  the  committee 
had  for  compelling  acceptance  of  its  price  determinations.1 

It  should  be  mentioned,  too,  that,  aside  from  these  direct  threats 
to  requisition  or  commandeer,  the  committee  had  effective  weapons 

1  A  brief  digest  of  the  main  acts,  including  the  two  above*  under  which  requisitioning 
of  goods  might  be  accomplished  or  commandeering  orders  issued  to  plants,  follows : 

1.  Public  41,  Sixty-fifth   Congress,   section   10. — The   food   control   act   authorizes    the 
President  to  requisition  foods,  feeds,  fuels,  and  other  supplies  necessary  to  the  support 
of  the  Army  or  the  maintenance  of  the  Navy  or  any   other  public  use  connected  with 
the  common  defense. 

2.  Public  853    Sia*ty- fourth   Congress,   section  120. — The   national   defense   act   provides 
for  the  placing  of  orders  with  any  concern  for  such  product  or  material  as  may  be  re- 
quired, and  which  is  of  the  nature  and  kind  usually  produced,  or  capable  of  being  pro- 
duced, by  such  concern.     In  the  event  of  a  refusal  so  to  produce,  the  plant  of  such  concern 
may  itself  be  taken  over  by  the  Government. 

3.  Public    391,    Sixty-fourth    Congress,    pages    28-29. — The    naval     appropriations    act 
authorizes  the  President  to  place  an  order  with  any  person  for  ships  or  war  material 
if  such   ships  or   material   are  of  the  nature,   kind,   and   quantity   usually   produced   or 
capable  of  being  produced  by  such  person.     Upon   refusal,  here,  also,  the  plant  may  be 
taken  over.     Under  this  act  "  war  material  "  is  made  to  include  arms,  armament,   am- 
munition,  stores,    supplies,   and   equipment  for  ships   and   airplanes,    and   everything  re- 
quired for  or  in   connection   with   the   production   thereof.      Another  paragraph  provides 
for  the  modification  or  cancellation  of  any  existing  contract  for  the  building,  production, 
or  purchase  of  ships  or  war  material.     It  is  further  provided  that  the  owner  or  occupier 
of  any  factory  in  which  ships  or  war  material  are  built  or  produced  shall  place  at  the 
disposal  of  the  United  States,  if  required,  the  whole  or  any  part  of  the  output  of  such 
factory.      Finally,   the   Government   may   requisition  any  factory  or  part   thereof.      It  is 
open  to  argument  whether  the  authority  here  granted  should  have  terminated  on  March 
1,  1918,  no  decisive  ruling  on  the  point  having  been  made. 

4.  Public  23,  Sixty-fifth  Congress. — The  so-called  emergency  shipping  fund  allows  the 
placing  of  an  order  with  any  person  for  such   ships  or  material  as   the   necessities   of 
the  Government,  to  be  determined  by  the  President,  may  require  during  the  period  of  the 
war  and  which   ar-e  of  the  nature,   kind,   and  quantity   usually   produced   or   capable  of 
being   produced   by   such    person.      Also,    power   is   given   to    requisition   ships   or    parts 
thereof. 

Requisitioning  under  tlie  icar  power. — Finally,  with  regard  to  the  power  to  requisition, 
some  mention  should  be  made  of  the  war  power.  The  President,  as  Commander  in  Chief 
of  the  Army  and  Navy,  has  undoubtedly  a  vast  field  over  which  he  may  exercise  his 
control  without  legislation.  Under  this  head  he  has  a  right  to  take  private  property  for 
public  use  upon  payment  of  just  compensation,  even  if  such  taking  is  not  authorized 
specifically  by  Congress.  Just  how  far  this  right  extends  it  is  hard  to  tell,  inasmuch  as 
presidential  action  would  depend  on  the  nature  of  a  given  emergency.  It  is  important 
to  make  mention  of  it  merely  because  of  the  right  to  requisition  which  is  thus  in.  the 
hands  of  the  Executive. 


GOVERNMENT   CONTROL   OVER   PRICES.  237 

-for  fixing  prices  in  its  influence  with  the  Railroad  Administration, 
the  Priorities  Committee,  the  Fuel  Administration,  the  War  Trade 
Board,  and  the  Food  Administration.  These  bodies,  each  in  control 
of  a  basic  material  or  service,  could  be  persuaded  to  withhold  trans- 
portation, license,  fuel,  supplies,  or  priority  to  enforce  price  agree- 
ments demanded  by  the  committee. 

THE  WAR-TIME  SPIRIT. 

It  made  really  little  difference,  while  the  country  was  united  to 
achieve  a  national  ideal,  that  the  price  fixing  committee  had  a 
somewhat  indefinite  statutory  authority.  For  the  legal  powers 
of  the  price  fixing  committee,  applicable  at  best  only  to  articles 
needed  for  the  use  of  the  Government,  were  of  much  less  prac- 
tical consequence  than  public  opinion  and  patriotic  spirit.  The 
universal  feeling  of  support  to  public  actions  taken  for  a  war  pur- 
pose was  the  most  potent  of  all  powers  behind  the  price  fixing  com- 
mittee. The  prices  in  all  cases  were  reached  in  conferences  by  agree- 
ments with  the  trade.  It  is  beside  the  point  to  inquire  whether  so 
slight  an  authority  would  suffice  for  peace-time  regulation.  No 
better  word  can  be  said  for  the  efficacy  of  the  war-time  spirit  for 
enforcing  price  agreements,  despite  the  lack  of  law,  than  that  no 
occasion  ever  arose  for  putting  to  a  test  the  nature  or  extent  of  its 
legal  authority.1 

(3)   ITS    SPHERE   OF   ACTIVITY. 

The  sphere  of  activity  peculiar  to  the  price  fixing  committee,  and 
its  distinction  from  the  Food  and  Fuel  Administrations  require  ex- 
planation. Obviously,  these  latter  agencies  controlled  foods,  feeds, 
and  fuels,  and  left  the  price  fixing  committee  to  determine  prices,  if 
necessary,  over  the  whole  remaining  lot  of  materials  needed  for  war. 
But  there  are  other  differences  less  apparent  and  more  important. 
The  price  fixing  committee,  unlike  these  two  administrations,  was 
not  a  huge  institution  responsible  upon  its  own  initiative  to  keep  con- 
sumers' prices  stable  and  send  its  administrators  into  every  town  and 
city  to  that  end.  It  was  a  very  small  quasi-judicial  committee,  acting 
only  upon  request  of  a  war  agency.  It  sat  primarily  to  .hear  evidence 
and  determine  fair  prices  for  Government  purchases,  and  was  con- 
cerned almost  altogether  with  producers'  prices. 

COMMITTEE  CONCERNED  PRIMARILY  WITH  GOVERNMENT  PURCHASES. 

One  of  the  features  of  the  control  exercised  by  the  price  fixing 
committee,  which  differentiates  it  sharply  from  the  food  and  fuel 


"  Price-Fixing   as   seen   by   a  Price-Fixer,"   by    F.   W.   Taussig,   Quarterly   Journal    of 
Economics,  February,  1919. 


238  HISTORY   OF   PRICES   DURING   THE   WAR. 

controls,  was  that  it  was  concerned  primarily  with  stabilizing  tne 
market  for  Government  purchases.  The  Food  Administration  and 
the  Fuel  Administration,  each  with  thousands  of  representatives  and 
an  enormous  administrative  machinery,  undertook  as  their  primary 
concern  the  stabilization  of  prices  for  the  public.  Their  control,  de- 
signed to  cover  the  whole  gamut  of  food  and  fuel  prices  from  the  big 
producer  to  the  country  retailer,  required  them,  within  a  much  nar- 
rower field  of  activity,  to  consider  greater  numbers  of  problems. 
But  the  price  fixing  committee,  with  its  wider  range  of  controls,  and 
a  more  highly  technical  problem,  -began  with  the  purpose  simply  to 
protect  the  Government.  It  came  but  gradually  to  concern  itself 
with  the  protection  of  the  public.1 

The  price  fixing  committee,  to  the  end  that  it  might  protect  the 
Government  in  making  purchases,  was  organized  to  include  repre- 
sentatives of  the  Army  and  Navy,  who  could  keep  it  informed  of 
contemplated  purchases  and  price  problems  which  arose  in  connec- 
tion with  them;  representatives  of  the  War  Industries  Board,  who 
personally  were  familiar  with  the  available  raw  materials  in  various 
industries  and  the  supply  of  labor ;  a  representative  of  the  Fuel  Ad- 
ministration, through  whom  control  over  fuel  for  manufacturers 
could  be  held;  and  representatives  of  the  Tariff  and  Federal  Trade 
Commissions,  who  could  supply  technical  data  tending  to  show  how 
prices  would  affect  production.  It  was  not  until  toward  the  last  that 
a  representative  of  the  agricultural  interests  was  appointed,  and 
never  was  it  attempted  to  give  the  purchasing  public,  retail  trade,  or 
wholesale  trade  special  representation  directly  in  the  committee.2 

THE  COMMITTEE  FIXED  PRICES  ONLY  UPON  REQUEST. 

As  already  said,  the  price  fixing  committee  did  not  deem  it  a  part 
of  its  function,  as  did  both  the  Food  and  Fuel  Administrations, 
to  make  and  keep  strict  watch  over  prices  in  which  the  Government 
itself  had  no  direct  concern.  The  committee,  even  if  inclined  to 
exceed  its  primary  responsibility  to  protect  the  Government,  had  no 
staff  adequate  to  maintain  control  over  the  price  level  in  a  larger 
way.  It  did  not  ask  for  itself  any  considerable  powers  of  initiating 

1  A  statement  of  this  policy  is  made  by  a  member  of  the  price  fixing  committee,  F.  W. 
Taussig,  in  the  Quarterly  Journal  of  Economics  for  February,   1919,  as  follows :   "  The 
action  of  the  committee  in  every  case  had  its  origin  in  the  circumstance  that  Govern- 
ment purchases  were  on  a  great  scale  and  threatened  to  disturb  market  prices.     The  ex- 
tension of  the  function  of  the  committee  to  the  regulation  of  prices  for  the  public  was, 
if  not  an  afterthought,  at  all  events  not  among  the  things  contemplated  at  the  start. 
The  committee  stepped  in  when  Government  purchases  threatened  to  upset  the  market, 
but  soon  found  itself  compelled  to  protect  the  public  also." 

2  Mr.   Robert  S.  Brookings,  in  an  early   conference  of  the  committee  with  the  trade 
(minutes    of    the    price    fixing    committee,    Book    II,    Apr.    3    to    Apr.    24,    p.    29),    said 
frankly  :  "  When  we  fix  prices  for  the  Government  we  have  no  difficulty,  but  when  we  fix 
prices  for  the  public  there  is  always  difficulty." 


GOVERNMENT   CONTROL   OVER  PRICES.  239 

price  control.1    Yet,  the  necessities  of  the  case  gradually  forced  the 
committee  to  take  a  broader  view  of  the  whole  price  situation. 

FIXED  PRODUCER  PRICES. 

The  sphere  of  activity  of  the  price  fixing  committee  is  especially 
well  defined  with  respect  to  the  kinds  of  prices  which  it  undertook 
to  fix.  There  is  a  vast  difference  in  the  complexity  of  problems 
arising  in  the  fixing  of  prices  for  the  producer  and  in  fixing  those 
for  the  retailer,  or  in  fixing  those  for  the  wholesaler,  distributor, 
and  middleman  of  all  sorts  in  between.  The  committee,  happily,  was 
not  obliged,  in  the  main,  to  deal  with  other  than  the  prices  at  which 
the  producer  should  sell  his  materials.  The  Government  usually 
bought  in  large  quantities  direct  from  the  primary  source  of  supply. 
If  the  committee,  as  the  war  went  on,  had  gone  further  in  the  direc- 
tion of  protecting  the  public,  it  is  doubtful  whether  they  would 
have  found  it  sufficient  to  fix  prices  at  the  primary  distributing 
points.  That  scheme,  though  highly  extended  by  the  requirement  of 
a  like  price  for  the  Allies  and  public,  gave  no  real  protection  from 
high  retail  prices  to  the  consumer.  In  no  other  respect  was  the 
sphere  of  activity  of  the  price  fixing  committee  so  narrow  as  in  the 
stage  at  which  transactions  were  controlled.2 

(4)  THE  CHARACTER  OF  THE  PRICE-FIXING  AGREEMENTS. 

The  price-fixing  committee,  in  the  strict  sense  of  the  term,  fixed 
no  prices.  A  perusal  of  the  various  terms  of  the  so-called  fixed-price 
announcements  and  the  minutes  of  the  meetings  of  the  committee 
shows  clearly  that  the  prices  fixed  represented  simply  agreements 
entered  into  with  the  industry  by  the  committee. 

THE  METHOD  OF  MAKING  THE  AGREEMENTS. 

The  price-fixing  committee,  in  part  as  a  measure  of  expediency 
and  in  part  because  of  lack  of  authority,  undertook  generally  to 
arrive  at  a  fair  price  by  series  of  conferences  with  the  trade,  rather 
than  through  any  more  high-handed  or  independent  method.  A 
leading  member  of  the  committee,  Dr.  F.  W.  Taussig,  goes  so  far 
as  to  say  that — 

the  prices  fixed  were  in  all  cases  reached  by  agreement  with  the  representatives 
of  the  several  industries.     In  strictness  they  were  agreed  prices  rather  than 

*Mr.  Robert  S.  Brookings,  chairman  of  the  price  fixing  committee,  when  asked  by 
certain  private  interests  to  fix  the  price  of  wool  on  Apr.  19.  1918,  said  (p.  63  of 
minutes  of  price  fixing  committee  for  a  conference  upon  that  day),  that  the  price  fixing 
committee  "  do  not  feel  that  it  is  any  part  of  our  function  to  take  initiative ;  at  least 
we  have  not,"  and,  when  pressed  to  say  whether  a  price  would  or  would  not  be  fixed 
on  wool  he  said :  "  You  might  ask  the  President.  He  is  the  only  man  who  has  any 
authority  to  say  yes  or  no  on  anything.  We  have  nothing  to  do  with  it." 

2  An  interesting  comment  is  made  upon  this  point  by  F.  W.  Taussig  in  the  article 
referred  to  previously. 


240  HISTOEY   OF  PRICES   DURING  THE  WAR. 

fixed  prices.  The  agreements  were  usually  reached  in  cordial  cooperation  with 
the  producers  concerned,  and  thus  were  in  reality  voluntary.  There  were  cases, 
however,  in  which  they  were  agreements  only  in  name.  The  representatives 
of  some  industries,  though  they  accepted  them,  did  so  virtually  under  duress. 
In  these  cases  the  committee  to  all  intents  and  purposes  decreed  prices  and 
was  enabled  to  impose  them,  under  the  form  of  agreement,  by  a  more  or  less 
veiled  threat  of  commandeering,  and  also  by  the  certainty  that  public  opinion 
would  condemn  those  who  failed  to  accede. 

It  was  the  custom  of  the  committee,  once  it  seemed  likely  that  the 
necessity  for  fixing  a  price  had  arisen,  to  call  the  representatives  of 
the  industry  to  Washington  for  conference.  The  committee,  after 
itself  going  over  cost  figures  prepared  for  it  by  the  Federal  Trade 
Commission,  talked  freely  with  the  trade  the  situation  at  hand, 
heard  the  trade  viewpoint,  and  finally,  with  them,  arrived  at  a  price 
mutually  satisfactory.  It  was  the  practice  usually  on  important 
matters  to  allow  the  trade  to  retire  for  confidential  discussion  between 
members.  Similarly  the  committee  usually  went  into  executive  session 
before  finally  announcing  the  price  agreed  upon  and  reviewing  the 
facts  of  the  agreement.  The  committee,  after  dismissing  the  rep- 
resentatives of  the  industry,  usually  submitted  the  price  fixed  to  the 
President  for  his  approval  and  public  announcement. 

ALL  PRICES  WERE  MAXIMUM  PRICES. 

It  was  characteristic  of  the  prices  fixed  by  the  price-fixing  com- 
mittee, if  indeed  not  of  all  prices  fixed  in  this  country  during  the 
war  save  those  for  wheat,  pork,  and  hemp,  that  no  more  rigid  control 
was  attempted  than  the  fixing  of  a  maximum  price.  The  committee 
really  set  limits  above  which  the  so-called  fixed  prices  might  not 
rise,  but  left  them  to  play  freely  below  those  points.  This  distinc- 
tion, though  precisely  accurate,  is  of  more  importance  in  theory  than 
in  practice,  because  usually  the  maximum  prices  became  the  actual 
prices  and  operated,  in  the  main,  as  fixed  prices.1  The  various  Gov- 
ernment departments  (the  Department  of  War,  the  Department  of 
Navy,  the  United  States  Shipping  Board  Emergency  Fleet  Corpora- 
tion, and  the  Railroad  Administration)  were  usually  guided  in  their 
purchases  by  the  fixed  maximum  prices  and  paid  them  without  more 
ado. 

FIXED  PRICES  APPLICABLE  ALIKE  TO  Low  AND  HIGH  COST  PRODUCER. 

The  prices  fixed  by  the  price  fixing  committee  were  made  ap- 
plicable alike  to  sales  made  by  low-cost  and  high-cost  producers. 
That  practice,  of  course,  put  decided  advantages  into  the  hands  of 
many  larger  manufacturers  and  producers  who  turned  out  enormous 

1  The  Instances  in  which  the  market  sank  below  the  fixed  prices,  as  it  did  with  zinc 
and  lumber,  are  relatively  few.  The  committee,  when  such  a  circumstance  occurred, 
simply  reduced  the  fixed  maximum  price  to  a  lower  level. 


GO  VEHEMENT   CONTROL   OVER  PRICES.  241 

quantities  of  product'  at  relatively  low  figures  and  handicapped, 
in  a  sense,  the  smaller  high-cost  producers.  It  gave  rise  to  no  end 
of  discussion  among  economists  within  and  outside  the  Government 
during  war,  but  no  departure  from  this  simple  measure  of  setting  a 
single  price  for  all  was  ever  adopted.1 

The  price  fixing  committee,  in  a  very  rough  way,  attempted  to  fix 
a  flat  price  at  a  point  which  would,  starting  from  the  lowest-cost 
producer,  take  in  enough  of  the  higher-cost  producers  to  bring  out 
in  quantity  the  approximate  production  required.  It  is  estimated 
by  Dr.  Taussig  that  the  price  usually  was  fixed  which  would  secure 
four-fifths  or  nine-tenths  of  the  entire  output.  When  reminded  that 
the  inevitable  corollary  of  that  procedure  was  that  many  low-cost 
producers  would  reap  large  profits,  the  price  fixing  committee  pointed 
in  answer  to  the  excess  profits  tax.  The  chairman  of  the  price  fixing 
committee  freely  said  that  what  the  Government  did  not  get  from 
the  low-cost  producer  through  price  fixing,  it  would  get  in  another 
form  through  taxation.2  The  price  fixing  committee  then  stuck 
throughout  to  its  policy  of  fixing  a  flat  rate  for  all  producers  whether 
having  low  or  high  costs. 

FIXED  PEICES  APPLICABLE  ALIKE  TO  GOVERNMENT,  ALLIED  AND  PUBLIC  PURCHASES. 

Long  before  the  work  of  the  price  fixing  committee  was  under  way, 
the  President  in  no  unmistakable  terms  had  mapped  out  the  policy 
that  "prices  mean  the  same  everywhere"  and  "we  must  make  the 
prices  to  the  public  the  same  as  the  prices  to  the  Government." 8  Not 
a  month  after  the  President  had  determined  upon  this  broad  policy, 
the  War  Industries  Board,  in  keeping  with  it,  declared  that  "  our 
Allies  shall  be  charged  no  more  than  our  own  Government  has  to 

1 A  fuller  discussion  of  this  problem,  from  a  slightly  different  standpoint,  may  be 
found  in  a  later  section  discussing  the  bases  for  determining  upon  what  price  to  fix. 

2  At  an  executive   session  of  the  price  fixing  committee,   held   July    8,   1918,   a  dis- 
cussion took  place  to  determine  to  what  extent,  if  any,  the  excess  profits  tax  should  be 
considered  in  the  fixing  of  prices.     Mr.  Brookings  submitted  a  memorandum  stating  that 
the  price  fixing  committee  was  created   to  stabilize   values   and   prevent   extortionately 
high  prices.     It  was  not  intended,  however,   unnecessarily  to  depress  values  to  a  point 
where  there  would  be  little  or  no  excess  profits  tax.     The  policy  of  the  committee  should 
be,  he  believed,  so  to  shape  prices  that  the  less  efficient  or  small  producer  would  receive 
a  fair  profit,  even  though  that  gave  the  larger  and  more  efficient  producer  a  very  liberal 
profit.     It  was  expected  that  the  new  excess  profits  tax  would  equalize  this  discrepancy 
by  taking  a  larger  proportion  of  the  liberal  profits  earned.     In  connection  with  this  sub- 
ject,  the  probable  effects  of  the  new  excess  profits  tax  were  then  discussed,  and  the 
chairman   was  requested   to   call   Mr.    Kitchin's   attention    to   the   probable   influence   on 
production  of  a  very  high  percentage  tax. 

3  An  address  to  the  mine  operators  and  manufacturers  made  by   the  President,   July 
12,  1917. 

125547°— 20 16 


242  HISTORY   OF  PRICES  DURING  THE  WAR. 

pay."  *  There  are  instances  of  prices  fixed  for  the  Government1  alone, 
prices  fixed  for  single  branches  of  the  Government  only,  and  for  allied 
purchases  only.  But,  by  and  large,  the  prices  fixed  by  the  price  fix- 
ing committee  were  applicable  alike  to  the  Government,  Allies,2  and 
the  public. 

(5)   THE  PRICE  POLICIES  OF  THE  COMMITTEE. 

A  search  through  the  voluminous  minutes  of  the  price  fixing  com- 
mittee for  their  great  underlying  policies  would  yield  few  quotable 
passages.  A  statement  of  policy  here  may  be  implicitly  contradicted 
by  another  statement  there.  In  the  record  of  most  cases,  indeed 
there  is  no  mention  of  any  underlying  policy  whatever. 

There  is  a  striking  difference  in  this  respect,  between  the  determi- 
nations of  the  price  fixing  committee  and  the  Food  Administration, 
though  it  is  perhaps  more  apparent  than  real.  The  former  seldom 
and  the  latter  usually  talks  about  policies,  as  might  be  expected  from 
an  analysis  of  the  two  kinds  of  control.  One  would  get  as  far, 
perhaps,  if  he  accepted  literally  the  statement  of  Chairman  Brook- 
ings  of  the  price  fixing  committee  that  "  we  have  nothing  to  say  about 
our  own  policy,  we  may  change  it  to-morrow," 3  or  that  of  another 
member,  Dr.  Taussig,  that  "  a  frankly  opportunist  policy  alone  was 
possible."  4  But  the  price  fixing  committee,  though  operating  with- 
out any  deep  controlling  policies,  had  in  mind  certain  broad  aims 
which  throw  some  light  upon  their  actions. 

It  is  noteworthy  that  Mr.  Baruch,  in  calling  the  committee  together 
for  organization,  impressed  it  with  a  responsibility  to  guard  against 
"  runaway  markets  "  and,  too,  with  the  necessity  for  fixing  prices  at 

1  This  policy  was  announced  by  the  War  Industries  Board,  Aug.  8,  1917,  with  but 
two  limitations :  That  the  Allies  must  henceforth  apply  the  same  principle  in  dealing 
with  their  own  producers  and  in  selling  to  us  and  in  selling  to  each  other ;  and  that  the 
arrangement  must  be  limited  to  war  materials. 

3  The  price  fixing  committee  information  book,  recording  a  meeting  of  Aug.  27,  1918, 
defines  its  application   of  fixed   prices  to  allied   purchases  by   the  following  resolution  : 

"  Be  it  resolved,  That  where  prices  are  stated  to  be  fixed  for  the  United  States  Govern- 
ment, the  governments  associated  with  it  in  this  war,  and  the  public  (or  primary 
civilian  sales)  the  said  prices  are  hereby  declared  to  extend  to  the  Government  and 
civilians  of  the  United  States  (including  civilians  of  its  Territories  and  insular  posses- 
sions), and  to  the  following  Governments,  i.  e.,  Great  Britain,  France,  Italy,  Belgium, 
and  Japan ; 

"  And  1)e  it  further  resolved,  That  these  maximum  prices  shall  not  extend  to  purchases 
made  by  the  civilians  of  the  above-mentioned  allied  nations  nor  to  the  Governments  or 
civilians  of  nations  other  than  those  above  enumerated." 

8  Minute  Book  of  the  Price  Fixing  Committee,  Book  2,  Apr.  19,  p.  63. 

4  Dr.  Taussig,  in  his  article  referred  to  above,  goes  on  to  say :  The  price  fixing  com- 
mittee, whose  wide  range  of  operations  might  make  its  doings  of  most  general  interest  to 
economists,  was  slowest  in  developing  a  general  policy ;  and  this  probably  for  the  very 
reason  that  its  scope  was  wide,  its  principles  of  action  little  prescribed  by  any  legisla- 
tive or  administrative  instructions.     There  was  no  more  than  a  gradual  and  tentative 
approach  to  any  principle  of  action  whatever.     This  restraint  was  as  wise  as  that  of 
a   court  of  law  which  refuses  to   commit  itself  on   any  questions!   of  principle  not  es- 
sential to  the  case  in  hand.     Had  the  war  continued,  and  had  the  regulation  of  industry 
lasted  longer  and  extended  farther,  all  sorts  of  new  situations  and  new  problems  would 
have  arisen,  for  whose  wise  disposal  no  rule  could  be  laid  down  in  advance. 


GOVERNMENT   CONTROL   OVER   PRICES.  243 

a  point  where  they  would  stimulate  production.1  He  then  delivered 
to  them  a  plan  which  the  War  Industries  Board,  earlier  that  day,  had 
set  down  for  the  committee  to  follow  in  its  deliberations  but  which 
marked  out  no  single  general  policy.2  The  committee,  after  being 
called  together,  plunged  at  once  into  the  task  before  them  and  began 
to  discuss  the  fixing  of  a  price  for  Oregon  and  Washington  fir  without 
laying  out  for  themselves  any  general  principles. 

It  does  not  appear  that  the  price  fixing  committee  undertook 
formally  to  set  down  for  its  own  guidance  any  general  lines  of  policy 
or  functions  until  an  executive  meeting  held  July  8,  1918,  when 
Chairman  Brookings  got  approval  for  the  following  statement : 

First.  Where  the  different  purchasing  departments  of  the  Government  re- 
quire so  large  a  proportion  of  any  commodity  as  to  produce  such  scarcity  of 
said  commodity  as  to  require  price  control  with  a  view  of  avoiding  a  runaway 
market,  the  price  fixing  committee  is  expected  by  conference  with  the  said 
manufacturers  of  said  commodity  to  stabilize  prices  by  agreement.  Failing  to 
agree,  the  price  fixing  committee  will  fix  a  price  and  enforce  same  through  some 
purchasing  department  of  the  Government,  using  to  that  end  not  only  the  va- 
rious purchasing  enabling  acts,  but  such  indirect  pressure  as  priority  in  fuel, 
transportation,  etc.,  will  permit. 

Second.  Where  a  scarcity  is  produced  in  part  or  in  whole  by  limitation  of 
imports,  it  is  the  Government's  duty  through  the  price  fixing  committee,  and  a 
system  of  import  licenses  under  control  of  the  War  Trade  Board,  to  see  that 
control  is  secured  of  said  importations  through  an  option  reserved  in  the  im- 
port licenses  so  as  to  prevent  a  runaway  market  in  said  imported  commodity. 

While  prices  as  above  outlined  may  only  be  arranged  for  the  Government  and 
those  associated  with  us  in  the  war,  they,  as  a  rule,  are  made  for  the  public 
as  well,  and  where  made  for  the  public,  the  price  paid  both  by  the  public  and 
the  Government  is  made  the  same,  and,  while  it  is  the  custom  to  make  maxi- 
mum prices  only,  it  is  generally  understood  that  unless  there  is  a  larger  supply 
than  the  demand,  the  maximum  prices  will  by  necessity  also  become  the  mini- 
mum price,  and  the  purchasing  departments  of  the  Government  are  usually 
expected  to  pay  this  price. 

Third.  While  the  different  purchasing  departments  of  the  Government  are 
expected  to  fix  prices  on  their  current  purchases  where  there  are  no  special 
problems  involving  a  lack  of  supply,  the  price  fixing  committee  may,  on  appli- 
cation, solve  any  special  price-fixing  problems,  the  nature  of  which  would  seem 
to  require  its  jurisdiction,  and  which  are  in  scale  with  the  time  involved. 

1  Minutes  of  the  price  fixing  committee  for  Mar.  14,  1918. 

2  The  Council   of  National    Defense,    in   its   announcement  of  the   creation   of   a   price 
fixing  committee  made  Mar.   19,   1918,   gave  at  least  the  following  pertinent  statement 
relative  to  the  aim,  of  the  committee :  The  object  of  the  price  fixing  committee  is  two- 
fold :  First,  it  will  be  a  separate  body,  quasi  judicial  in  nature,  for  the  purpose  implied 
in  its  name,  and  it  will  serve  this  purpose  through  being  made  up  of  men  separated  so 
completely  from  industrial  interests  that  their  motives  and  actions  in  the  determination 
of  prices   can  be   subject   to   no   suspicion    of   mercenary    interest.      Prices   will   not   be 
made  until  after  costs  have  been  passed  upon  by  the  Federal  Trade  Commission.     With 
costs  as  a  basis,  the  price  fixing  committee  will  then  consider  problems  of  production  and 
distribution  before  arriving  at  its  decisions. 

The  second  object  to  be  achieved  by  the  price  fixing  committee  is  speed.  The  com- 
mittee will  sit  all  the  time  and  will  thus  eliminate  unnecessary  delay  caused  by  the  con- 
sideration of  price  fixing  problems  in  several  different  quarters. 


244  HISTORY  OF   PRICES  DURING  THE   WAR. 

Perhaps  there  was  no  single  aim  more  desired  by  the  price  fixing 
committee  than  that  brought  out  succinctly  by  its  Army  member, 
Lieut.  Col.  Eobert  H.  Montgomery,  "to  stimulate  production  by  one 
way  or  another."  That  policy  was  always  uppermost  in  the  minds 
of  the  committee. 

(6)  ADMINISTERING  COMMITTEE  DECISIONS. 

The  price  fixing  committee,  quite  without  administrative  ma- 
chinery, left  the  task  of  administering  controls  designated  by  it  and 
the  enforcing  of  fixed  base  prices  or  differentials  entirely  with  the 
commodity  chiefs  of  the  War  Industries  Board.  The  commodity 
chiefs,  familiar  with  the  technical  problems  of  the  various  trades 
and  in  touch  with  the  hundreds  of  war  service  committees,  were  in  a 
peculiarly  favorable  position  to  enlist  a  full  cooperation  from  the 
industry. 

(7)   THE  COMMODITIES   FIXED   IN  PRICE  BY   THE  WAR  INDUSTRIES 
BOARD  AND  THE  PRICE  FIXING  COMMITTEE. 

It  is  scarcely  feasible  to  consider  separately  the  commodities 
fixed  in  price  by  the  War  Industries  Board  and  the  price  fixing 
committee,  though  note  should  always  be  made  of  the  special  phases 
of  any  regulation  which  each  contributed.  The  controls  undertaken 
by  the  War  Industries  Board  between  September,  1917,  and  March, 
1918,  and  then  transferred  to  the  price  fixing  committee  concerned 
copper,  iron  and  steel,  cement,  yellow  pine,  Douglas  fir,  zinc,  alumi- 
num, hemlock,  North  Carolina  pine,  and  spruce.  The  controls  initi- 
ated by  the  price  fixing  committee  between  March  14  and  the  close  of 
war  concerned  hides  and  skins,  wool,  munition  linters,  harness  leather, 
sulphuric  acid,  nitric  acid,  cotton  textiles,  cotton  linters,  sand  and 
gravel,  manila  fiber,  building  tile,  sole  and  belting  leather,  rags, 
wool  grease,  compressing  rates  for  cotton,  brick,  millwork,  and  gyp- 
sum wall  board.  The  informal  controls  exercised  by  the  War  In- 
dustries Board  itself  independently  of  the  price  fixing  committee 
concerned  lead,  wood  chemicals,  nitrate  of  soda,  alkalis,  nickel,  quick- 
silver, platinum,  manganese  ore,  and  burlap. 

There  follows  a  discussion  of  the  most  important  of  these  controls 
under  the  following. main  commodity  headings  in  the  order  named: 
Iron  and  steel,  and  their  products;  copper;  aluminum;  lead;  zinc; 
nickel;  quicksilver;  platinum;  cotton  textiles;  cotton  linters  wool; 
hides,  skins  and  leather;  manila  fiber  and  hemp;  burlap;  lumber; 
building  materials ;  and  chemicals. 

IRON  AND  STEEL  AND  THEIR  PRODUCTS. 

There  is  scarcely  an  experience  with  price-fixing,  throughout  our 
whole  war  period,  which  is  more  striking  or  more  important  than 


GOVERNMENT   CONTROL   OVER   PRICES.  245 

that  with  the  iron  and  steel  family.1  Regulation  was  invoked  within 
our  first  six  months  of  war  to  rescue  iron  and  steel  prices  from  a 
runaway  market.  The  extraordinary  demands  of  the  Allies  for 
war-making  steel,  and  the  sudden  potential  demands  of  the  American 
Government,  combined  to  squeeze  short  the  civilian  supply  and  start 
prices  skyward.  Prices  did,  in  point  of  fact,  attain  a  peak  in  July, 

1917,  without  precedent  in  the  epochal  year  1899,  or  in  earlier  iron 
and  steel  history.     The  Government  and  everyone  saw  then  a  need 
to  do  something,  and  they  began  considering  how  best  to  make  the 
market  stable. 

An  analysis  of  price  control  within  the  iron  and  steel  group,  then, 
entails  a  comprehension  of  the  runaway  market  in  1917;  the  dis- 
position to  control  iron  and  steel  prices  reached  both  by  the  Govern- 
ment and  the  industry ;  the  kinds  of  problems  facing  the  Government 
in  assuming  control ;  the  raw-material  prices  fixed  on  September  24, 
1917;  the  semifinished-product  prices  fixed  on  October  11,  1917;  the 
finished-product  prices  fixed  on  November  5,  1917;  and  the  deter- 
mination of  differentials  upon  these  basic  prices. 

The  runaway  steel  market  in  1917. — A  careful  study  of  the  war- 
time prices  of  the  basic  raw  materials  of  the  iron  and  steel  industry 
(iron  ore,  coke,  pig  iron,  scrap  steel,  steel  billets,  "steel  bars,  steel 
shapes,  steel  plates,  steel  rails,  steel  spikes,  steel  skelp,  rivets,  cast- 
iron  pipe,  steel  hoops,  steel  sheets,  tinplate,  wire  rods,  and  wire 
fence),  and  especially  of  those  most  used  in  making  war,  shows 
clearly  that  iron  and  steel  prices  held  steadily  below  their  prewar 
level  for  a  full  year  after  Europe  started  war.  The  market  then, 
however,  became  sensitive  and  prices,  in  the  main,  began  soaring. 
The  open  market  price  of  Connellsville  coke,  for  example,  which  is 
a  principal  factor  in  the  price  of  pig  iron,  jumped  from  $1.67  per 
ton  in  September,  1915,  to  $12.25  in  July,  1917,  with  but  two  set- 
backs. The  price  of  basic  pig  iron  itself  began  rising  in  June,  1915, 
when  it  was  selling  for  $12.59  per  ton,  and  climbed  steadily  to  $52.50 
per  ton  in  July,  1917.  Bessemer  steel  billets  jumped  in  a  straight 
line  from  $19.50  per  ton  in  May,  1915,  to  $95  per  ton  during  June  and 
July,  1917.  Structural  steel  shapes  rose  from  0.012  per  pound  in 
December,  1914,  to  0.062  per  pound  in  July,  1917.  Steel  tank  plates 
shot  from  $1.22  per  hundredweight  in  July,  1915,  to  $9  per  hundred- 
weight in  July,  1917.2 

But  even  these  phenomenal  rises  are  less  impressive  than  the 
index  number  constructed  to  reflect  a  grand  average  of  the  whole 
steel  market.  An  index  number  for  the  iron  and  steel  group,  includ- 

1  The  control  of  iron  and  steel,  and  their  products  was  begun,  and  put  well  under  way, 
by  the  War  Industries  Board  before  the  creation  of  the  price  fixing  committee  in  March, 

1918.  The  whole  subject  is  treated  here,  however,  for  the  sake  of  continuity. 

2  Quotations  from  Iron  Age  of  open  market  prices.     The  contract  prices,  which  are  not 
available,   of  course  underwent  less   violent   fluctuations. 


246 


HISTORY   OF  PRICES   DURING  THE   WAR. 


ing  88  leading  iron  and  steel  prices  and  weighted  to  assign  each 
commodity  its  due  influence  upon  the  final  average,  has  been  pre- 
pared to  measure  the  general  trend  of  iron  and  steel  prices  away 
from  their  prewar  level,  from  January,  1913,  to  December,  1918. 
For  later  reference  this  index  number  is  here  shown  for  the  months 
subsequent  to  the  peak  point  in  July,  1917,  as  well  as  before.1 

WEIGHTED  INDEX  NUMBERS  OF  PRICES. 

IKON,   STEEL,   AND  THEIR  PRODUCTS  AND   "  ALL  COMMODITIES." 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

Iron  and  steel  and  their  products: 
January 

121 

95 

89 

138 

235 

218 

February 

120 

98 

90 

143 

238 

218 

March.  . 

119 

97 

90 

160 

254 

218 

April 

116 

96 

91 

164 

274 

217 

May... 

115 

93 

92 

161 

294 

217 

June 

113 

92 

93 

162 

344 

218 

July 

112 

92 

97 

164 

370 

218 

August 

111 

93 

103 

168 

346 

219 

September                                         .  . 

108 

95 

108 

170 

310 

219 

October 

104 

92 

111 

175 

243 

222 

November                              

98 

90 

117 

202 

218 

222 

December 

96 

89 

131 

221 

217 

217 

Quarters: 
First 

120 

97 

90 

145 

242 

218 

Second.                  

114 

94 

92 

162 

306 

217 

Third 

110 

93 

103 

167 

342 

219 

Fourth 

99 

90 

119 

198 

226 

220 

Years                 '               

111 

93 

101 

168 

279 

218 

*  All  commodities": 
January  

103 

100 

100 

115 

148 

185 

February                                      

102 

100 

100 

118 

151 

187 

March 

102 

99 

100 

121 

156 

188 

April... 

101 

98 

100 

123 

170 

191 

May 

100 

97 

100 

123 

178 

190 

June  

100 

97 

100 

122 

183 

189 

July....           -                 

100 

97 

102 

123 

189 

193 

August 

101 

101 

102 

125 

187 

196 

September  

102 

101 

102 

127 

186 

201 

October 

102 

99 

104 

132 

183 

201 

November 

102 

98 

107 

141 

183 

201 

December.          

101 

98 

111 

144 

182 

203 

Quarters: 
First                        .               . 

102 

100 

100 

118 

152 

187 

Second 

100 

97 

100 

123 

177 

190 

Third  

101 

100 

102 

125 

187 

197 

Fourth 

102 

98 

107 

139 

182 

202 

Years 

101 

99 

102 

126 

175 

194 

1  The  index  number  for  iron  and  steel  prices  is  made  of  the  monthly  averages  from 
January,  1913,  to  December,  1918,  of  88  separate  and  more  important  commodities, 
ranging  from  the  raw  material  to  finished  product  state,  which  make  up  the  iron  and 
steel  group.  In  order  not  to  allow  extraordinary  rises  within  less  important  com- 
modities an  undue  influence  upon  the  index  number,  each  commodity  was  weighted,  by 
multiplying  each  of  its  monthly  prices,  by  the  amount  produced  in  1017  plus  the  imports 
for  that  year.  The  aggregates  thus  found  were  then  turned  into  relative  prices  on  a 
prewar  base,  by  accepting  arbitrarily  as  100  the  average  aggregate  from  July,  1913,  to 
June  30,  1914.  The  index  number  includes  the  following  commodities  of  one  or  more 
series :  Iron  ore,  coke,  pig  iron,  steel  scrap,  steel  billets,  steel  bars,  iron  bars,  steel 
shapes,  steel  plates,  steel  rails,  steel  spikes,  rivets,  steel  skelp,  cast-iron  pipe,  steel 
hoops,  steel  sheets,  tinplate,  wire  rod,  wire  fence,  adzes,  anvils,  augers,  axes,  braces, 
butts,  calks,  chain,  chisels,  cutlery,  files,  gimlets,  hammers,  hinges,  hods,  hooks,  hooks 
and  eyes,  knobs,  locks,  lock  sets,  nails,  pans,  pails,  planes,  punches,  rasps,  rings  and 
ringers,  saws,  screws,  shaves,  shoes,  shovels,  spoons,  springs,  staples,  swages,  tongs, 
traps,  trowels,  trucks,  turns,  vises,  washers,  wedges,  wheelbarrows,  wire.  See  "  Prices 
of  iron,  steel,  and  their  products,"  by  Walter  W.  Stewart  (War  Industries  Board  Price 
Bulletin  No.  33). 


GOVERNMENT   CONTROL   OVER  PRICES. 


247 


1O1O      I 


WDCHTO  1HEEX  NUMBBTcr  PRTC8S  OP 

— IRONXSTCCL  . 
~4\LL  COMMODITIES 


The  iron  and  steel  market,  according  to  these  comprehensive  figures 
remained  safely  below  its  prewar  level  for  a  year  after  war  broke 
out  in  Europe.  It  then  mounted  steadily,  without  a  single  note- 
worthy setback,  to  the  historic  peak  attained  for  steel  prices  in  July, 
1917,  at  270  per  cent  above  the 
prewar  level.  That  rise  was  out 
of  all  bounds  with  the  point 
reached  by  the  "  all  commodities  " 
index  number  for  the  same  month 
at  89  per  cent  above  its  prewar 
level.1  Iron  and  steel  prices,  by 
midsummer  of  1917,  when  the 
Government  began  seriously  to 
lay  its  hand  upon  them,  were 
literally  running  away. 

The  disposition  to  control  iron 
and  steel  prices. — The  runaway 
steel  market,  coming  just  at  a 
time  when  the  Government  was 
beginning  to  anticipate  extraordi- 
nary requirements  of  steel  for  war- 
making  purposes,  gave  alarm  to 
the  President,  the  Congress,  and 
the  more  sober  element  of  the  steel 
industry.  It  became  obvious  that 
the  Government,  in  order  to  as- 
sure itself  and  the  Allies  steel  at 
reasonable  prices,  would  need  to 


6V  MONTHS 


1915      I     1914      I      1013      |      1016 

«».M.JJ..  M-iw..M.i.M..i 


Jfltt 


aaac: 


ffi 


Weighted  index  numbers  of  prices. — 
Iron  and  steel ;  and  "All  Commodities." — 
By  months,  January,  1913,  to  December, 
1918.  (Average  quoted  prices,  July, 
1913,  to  June,  1914=100.) 


take  a  more  radical  action  than 
had  previously  been  determined 
upon.2 

The  policy  of  the  President  and 
his  war  officials. — The  determined 
stand  made  by  the  President  upon 
price  control,  in  the  official  state- 
ment of  July  12,  1917,  came  just  at  the  time  when  steel  was  at  its 
highest  point,  and  affected  generally  the  disposition  toward  exces- 
sive profit  taking.    It,  therefore,  hastened  steel  control.    The  Presi- 

1  The  "  all  commodities  "  index  number,  weighted   in  the  same  way,   represents  1,366 
individual  commodities  within  the  food,  clothing,  rubber,  paper,  fiber,  metals,  fuels,  build- 
ing materials,   and  chemicals  groups.      (See  "  History   of  Prices  during  the  War,   Sum- 
mary," by  Wesley  C.  Mitchell,  War  Industries  Board  Price  Bulletin  No.  1.) 

2  A  special  board,  appointed  by  the  Secretary  of  War  "  for  the  purpose  of  investigating 
and   reporting  upon   the  feasibility,   desirability,    and   practicability   of  the   Government 
manufacturing  arms,   munitions,  and  equipment,"   made   public  their   conclusion   Jan.   9, 
1917,  advising  a  reliance  upon  private  industry. 


248  HISTOKY  OF  PRICES  DURING  THE   WAR. 

dent  declared  unqualifiedly  for  a  "just  price"  and  declared  that 
those —  s 

who  do  not  respond  in  the  spirit  of  those  who  have  gone  to  give  their  lives  for 
us  on  bloody  fields  far  away,  may  safely  be  left  to  be  dealt  with  by  opinion 
and  the  law,  for  the  law  must  of  course  command  these  things. 

The  President  added  succinctly  that— 

the  Government  is  about  to  attempt  to  determine  the  prices  at  which  it  will  ask 
you  henceforth  to  furnish  various  supplies  which  are  necessary  for  the  prosecu- 
tion of  the  war  and  various  materials  which  will  be  needed  in  the  industries  by 
which  the  war  must  be  sustained.  We  shall  of  course  try  to  determine  them 
justly  and  to  the  best  advantage  of  the  nation  as  a  whole. 

It  is  pertinent  that  the  President,  in  making  his  statement,  gave 
assurance  that  the  industries  would  be  sustained  at  a  point  of  ade- 
quate production. 

There  followed  in  rapid  succession  an  expression  of  views  regard- 
ing price  control  of  iron  and  steel  by  various  high  officials.  The 
Secretary  of  the  Navy  said : 

There  is  no  justification  for  a  tremendous  increase  in  the  cost  of  basic  ma- 
terials. The  Almighty  put  these  things  in  the  ground,  and  the  only  additional 
cost  over  normal  times  is  in  getting  them  out.  Under  the  law  the  President  is 
authorized  to  fix  a  reasonable  price  for  what  is  needed  for  the  Government. 
There  is  no  disposition  whatever  to  cause  any  hardship  to  the  producers.  We 
are  perfectly  willing  and  intend  to  pay  them  a  fair,  even  a  liberal  profit,  but 
we  will  not  pay  exorbitant  prices,  such  as  are  being  quoted  in  some  instances. 

The  Secretary  of  War,  after  a  conference  with  steel  manufacturers 
about  the  middle  of  July,  1917,  declared  for  a  control  of  iron  and 
steel  which  would  "  insure  reasonable  profits  "  and  determined  upon 
"  with  reference  to  the  needs  of  this  vital  and  fundamental  industry." 
The  chairman  of  the  Shipping  Board  was  reported  to  say  that  in 
case  the  steel  producers  refused  to  accept  the  prices  fixed  on  the  basis 
of  the  proposed  cost  investigation  by  the  Federal  Trade  Commis- 
sion, he  favored  the  commandeering  of  all  steel  plants.  The  chair- 
man of  the  Senate  Committee  on  Interstate  Commerce,  whose  com- 
mittee had  been  charged  to  inquire  into  the  high  prices  of  certain 
materials,  said  that — 

it  had  been  demonstrated  that  competition  was  powerless  to  keep  the  prices  of 
the  basic  materials  at  the  normal  level ;  that  the  result  of  the  law  of  supply  and 
demand  had  been  that  an  enormous  demand  had  been  precipitated  upon  a  lim- 
ited supply,  and  thus  there  was  no  limit  to  which  the  prices  might  soar. 

Meantime  a  controversy  over  the  prices  to  be  paid  by  the  Gov- 
ernment for  structural  shapes  and  steel  plates  arose  between  the 
chairman  of  the  United  States  Shipping  Board  and  the  manager 
of  the  Emergency  Fleet  Corporation,  which  resulted  in  a  request 
by  the  President  that  the  Federal  Trade  Commission  inquire  into  the 


GOVERNMENT   CONTROL   OVER  PRICES.  249 

costs  of  producing  steel.  The  manager  of  the  Emergency  Fleet 
Corporation  announced  on  June  16,  1917,  that  he  had  agreed  pro- 
visionally upon  a  price  of  3.75  cents  per  pound  for  shapes  and  4.25 
cents  per  pound  for  plates,  with  the  understanding  that  the  com- 
mittee on  raw  materials,  minerals,  and  metals  of  the  Council  of 
National  Defense  would  later  go  into  the  question  of  costs  and 
determine  an  equitable  return  to  the  steel  men.  The  chairman  of  the 
Shipping  Board,  on  the  other  hand,  declared  that  these  provisional 
prices  were  $30  a  ton  higher  than  prices  which  the  Navy  Depart- 
ment was  paying  for  the  same  material,  and  that  he,  therefore, 
would  sign  no  contracts  at  those  figures.  The  steel  makers  agreed 
finally  to  furnish  steel  plates  at  a  tentative  price  of  2.50  cents  per 
pound,  pending  the  determination  of  a  final  price.  Controversies 
of  this  sort,  to  say  nothing  of  other  official  opinion  as  indicated 
above,  were  potent  factors  in  persuading  the  President  and  the 
Government  to  control  iron  and  steel  prices. 

The  Pomerene  'bill  in  Congress. — The  concern  within  the  Govern- 
ment over  the  steel  situation  was  not  confined  alone  to  the  President 
and  his  war  officials.  The  Congress,  too,  became  uneasy,  and 
while  the  rampant  steel  market  was  on,  Senator  Pomerene  of  Ohio 
introduced  a  bill  providing  for  Government  control  over  iron  and 
steel  prices.  The  bill  was  designed  to  afford  the  President  the  same 
power  over  the  prices  and  distribution  of  iron  ore,  pig  iron,  steel, 
and  their  products  as  the  food  and  fuel  act  (Lever  bill)  had  given 
him  over  foods,  feeds,  and  fuel.  It  should  be  said  that  the  bill,  in 
some  respects,  contemplated  even  further  control  than  that  given 
in  the  food  and  fuel  act.  The  bill  went  so  far  as  to  provide  that  the 
President  should  have  power,  whenever  in  his  judgment  it  became 
necessary — 

for  the  efficient  prosecution  of  the  war  and  for  the  purposes  aforesaid,  to  fix 
the  price  of  iron  ore,  iron,  steel,  and  their  products  wherever  and  whenever 
sold,  either  by  producer  or  dealer,  to  establish  rules  for  the  regulation  of  and 
to  regulate  the  method  of  production,  sale,  shipment,  distribution,  apportion- 
ment, or  storage  thereof  among  dealers  and  consunfers,  domestic  or  foreign.1 

It  is  noteworthy  that  the  Pomerene  bill  made  the  Federal 
Trade  Commission,  rather  than  the  Council  of  National  Defense, 
the  agency  for  exercising  the  presidential  authority  over  iron  and 
steel  prices  and  gave  it  an  abundance  of  power  to  investigate  costs. 

The  Pomerene  bill,  quite  aside  from  these  drastic  provisions,  gave 
the  President  a  commandeering  power  which  struck  fear  in  the 

1  A  full  account  of  the  provisions  of  the  Pomerene  bill  is  given  in  the  Iron  Age  for 
Aug.  16,  1917  ;  that  for  Aug.  30,  1917  ;  and  an  especially  illuminating  account  of  the 
hearing  on  the  bill  held  Sept.  21,  1917,  by  the  Senate  Committee  on  Interstate  Commerce, 
is  found  in  the  Iron  Age  for  Sept.  27,  1917. 


250  HISTORY   OF   PRICES   DURING  THE  WAR. 

minds  of  many  producers.  The  President  was  authorized,  when- 
ever any  producer  or  dealer  failed  to  conform  to  his  stipulated 
regulations — 

to  requisition  and  take  over  the  plant,  business,  and  all  appurtenances  thereof 
belonging  to  such  producer  or  dealer  as  a  going  concern,  and  to  operate  or. 
cause  the  same  to  be  operated  in  such  manner  and  through  such  agency  as  he 
may  direct. 

The  discussion  in  the  Congress  of  this  bill,  though  it  was  never 
made  law,  aroused  the  legislators  quite  as  much  to  the  need  of  iron 
and  steel  control  as  the  experience  of  the  Executive  and  his  Cabi- 
net had  aroused  them. 

The  attitude  of  the  iron  and  steel  industry. — It  is  not  the  least 
significant  of  the  factors  which  brought  on  control  of  iron  and  steel 
prices,  that  the  industry  itself  came  to  recognize  the  need  for  and  to 
desire  control.  It  is  not  easy  to  trace  the  conversion  of  the  iron  and 
steel  trade  to  an  appreciation  of  the  need  for  Government  inter- 
ference, so  gradually  did  it  come.  But  by  midsummer  of  1917  the 
more  conservative  factions  of  the  steel  industry  saw  only  peril  ahead 
unless  the  Government  brought  stabilization  to  the  market.  By 
late  September  virtually  the  whole  industry  was  disposed  to  recom- 
mend that  a  formal  regulation  begin. 

No  doubt  an  influence  of  consequence  in  changing  the  attitude  of 
the  steel  men  toward  control  was  their  knowledge  that  the  Govern- 
ment was  determined  upon  it.  The  Iron  Age,  a  leading  journal  of 
the  industry,  foretold  Government  regulation  in  its  feature  edi- 
torial as  early  as  June  28,  1917,  although  it  then  looked  a  bit  askance 
at  the  prospect.  It  said  in  part : 

Predictions  are  becoming  more  and  more  common  that  it  will  become  neces- 
sary for  the  Government  to  regulate  prices  in  the  steel  industry.  The  pro- 
posal is  glibly  made,  but  it  involves  serious  and  far-reaching  consequences. 
*  *  *  It  is  difficult  to  see  how  the  fixing  of  maximum  prices  for  this  com- 
modity or  that  could  make  the  conduct  of  business  more  orderly. 

That  same  journal  less  than  a  month  later,  July  19,  declared: 

What  is  certain  is  that  the  fixing  of  new  prices  by  the  Government  is  at 
hand  *  *  *  the  Government  is  not  alone  in  wanting  regulation  of  steel 
prices.  Many  producers  and  buyers  of  steel  have  feared  the  consequence  of 
the  ungoverned  upward  movement  of  the  past  six  months. 

and  still  a  month  later,  August  30,  it  said  frankly  in  another  leading 
editorial  on  the  subject  that — 

undoubtedly  there  are  commodities  the  price  of  which  the  Government  should 
seek  to  reduce  *  *  *  undoubtedly  the  war  necessitates  practices  that  would 
not  be  resorted  to  in  time  of  peace,  but  such  practices  are  no  better  than 
necessary  evils  *  *  *  it  is  no  time  for  some  to  make  inordinate  profits  and 
add  largely  to  their  wealth,  when  the  total  material  wealth  is  increasing  less 
rapidly  than  usual. 


GOVERNMENT   CONTROL   OVER  PRICES.  251 

The  preceding  paragraphs  have  been  extended  to  some  length  to 
show  the  prevailing  attitude  toward  iron  and  steel  control  before 
it  set  in.  It  is  of  peculiar  bearing  upon  the  whole  institution  of 
steel  control  that  it  came  not  until  after  the  President,  his  war 
officials,  the  Congress,  and  the  industry  itself  believed  that  it  ought 
to  come.  The  Government  and  the  industry,  then,  were  in  a  state 
of  mind  to  sit  around  the  same  table  and  determine  together  what 
kind  of  control  they  wanted  and  how  it  should  be  exercised. 

Problems  facing  the  Government  m  assuming  control. — Even  though 
the  Government,  and  subsequently  the  industry,  had  made  up  their 
minds  to  a  control  over  iron  and  steel  prices  by  midsummer  of  1917, 
there  were  still  several  important  technical  questions  facing  the 
Government  in  assuming  that  control.  The  Government  had  then 
learned  neither  the  technique  of  price  fixing,  nor  the  general  policies 
underlying  it.  It  knew  little  more  at  the  outset  than  that  in  de- 
termining upon  reasonable  prices,  it  ought  not  to  hamper  the 
production  of  steel.  A  host  of  inquiries  made  the  Government 
think  seriously  whether  any  prices  fixed  for  its  own  purchases  should 
be  made  applicable  to  public  purchases ;  whether  Government  prices 
should  be  extended  to  the  Allies;  whether  the  fixed  prices  should 
be  determined  through  a  flat  rate  or  a  flexible  cost-plus  profit  scale ; 
whether  the  proposed  fixed-price  schedule  would  or  not  abrogate 
outstanding  contract  price  agreements;  whether  the  Government, 
in  determining  upon  prices,  should  take  cognizance  of  the  incidental 
labor,  fuel,  and  transportation  problems;  and  whether  control  over 
the  producers  would  take  proper  account  of  the  middlemen. 

Should  control  extend  to  civilian  purchase. — The  President  left 
little  opportunity  for  officials  to  disagree  among  themselves  whether 
the  public  should  be  made  a  party  to  war  prices  fixed  for  Government 
purchases.  The  interpretation  given  by  the  President  in  his  well- 
known  letter  of  July  12,  left  few  doubts  what  attitude  the  country 
might  expect  the  Government  to  take  in  setting  the  prices  for  iron 
and  steel.  In  it  he  declared  unequivocally  that — 

We  must  make  the  prices  to  the  public  the  same  as  prices  to  the  Government. 
Prices  mean  the  same  everywhere  now ;  they  mean  the  efficiency  of  the  Nation 
whether  it  is  the  Government  that  pays  them  or  not.  They  mean  victory  or 
defeat. 

The  War  Industries  Board  later  in  the  summer  indorsed  heartily 
that  expression  and  thus,  too,  made  clear  its  determination  to  follow 
the  President's  lead.  The  problem  was  settled  once  for  all  by  open- 
ing to  the  public  generally  the  full  advantage  of  prices  fixed  by  the 
Government. 

Should  control  extend  to  allied  purchases. — The  War  Industries 
Board  did  not,  moreover,  hesitate  long  to  extend  to  the  Allies  gen- 


252  HISTORY   OF   PRICES   DURING   THE   WAR. 

erously  the  advantages  to  be  had  from  price  regulation  within  the 
iron  and  steel  groups.  The  earlier  policy  of  the  President  again 
dominated  the  policy  of  the  board  in  announcing  finally  that1— 

It  is  the  purpose  of  the  War  Industries  Board  to  carry  out  the  policy  recently 
announced  by  the  President  *  *  *  that  in  the  purchase  of  war  materials 
in  this  country  our  allies  shall  be  charged  no  more  than  our  own  Government 
lias  to  pay.  *  *  *  But  this  policy  has  two  important  limitations.  First,  it 
must  be  reciprocal.  The  Allies  must  henceforth  apply  the  same  principle  in 
dealing  with  their  own  producers  and  in  selling  to  us  and  in  selling  to  each 
other.  Second,  the  arrangement  must  be  limited  to  war  materials,  in  order 
to  protect  our  own  industry.  We  must  not  allow  raw  material  sold  by  our 
producers  at  prices  patriotically  conceded  to  our  own  Government  and  its 
allies  for  war  purposes  to  be  diverted  to  industry  and  trade  abroad  which  may 
come  in  competition  with  our  own  manufacturers  and  producers. 

The  decision  to  extend  prices  fixed  for  Government  purchases  to 
the  allied  purchases  came  with  but  little  more  hesitation  than  that 
to  extend  them  to  public  purchases. 

Flat  rate  or  cost  plus  pro-fit  scale. — There  was  not  a  little  disturb- 
ance among  officials  at  Washington  over  the  problem  whether  prices 
for  iron  and  steel  ought  to  be  fixed  at  a  flat  rate,  applicable  alike  to 
high  and  low  cost  producers,  or  determined  variously  by  use  of  a 
flexible  scale  allowing  each  producer  a  certain  profit  above  his  legiti- 
mate costs.  The  proper  basis  for  determining  upon  a  fixed  or  maxi- 
mum price  for  iron  and  steel  was  by  no  means  clear  to  the  Govern- 
ment even  when  it  came  to  the  very  threshold  of  control. 

The  Federal  Trade  Commission,  for  the  purpose  of  helping  to 
solve  the  problem,  had  been  requested  to  submit  current  figures  show- 
ing the  cost  of  production.  But  it  was  not  then  known  whether  cost 
data  should  be  adopted  as  a  basis  for  price  fixing  or,  if  so,  what  costs. 
The  Federal  Trade  Commission  figures  showed  nothing  so  clearly  as 
that  there  was  no  uniformity  in  the  costs  of  various  producers.  The 
difference  in  costs  of  production  was  made  only  the  more  confusing 
and  complicated  by  testimony  given  at  the  time  before  the  Senate 
Committee  on  Interstate  Commerce  by  Joseph  E.  Davies,  of  the 
Federal  Trade  Commission.  It  was  brought  out  that  there  were 
not  only  varying  costs  within  each  class,  but  also  as  between  four  dis- 
tinct classes  of  iron  and  steel  producers  based  upon  their  degree  of 
integration.  There  were,  in  other  words,  those  owning  their  own  ore, 
transportation  facilities  for  shipping  it,  blast  furnaces,  rolling  mills., 
and  works  for  the  manufacture  of  the  finished  products;  those  who 
bought  their  ore  and  coke  in  whole  or  part,  but  controlled  the  other 
stages  of  production ;  those  who  purchased  their  pig  iron,  but  manu- 
factured their  own  steel ;  and  those  who  bought  their  steel  ingots  and 
billets  and  rolled  their  oAvn  plates,  shapes,  and  other  products.2  The 

1  Iron  Age,  Aug.  16,  1917.  2  Iron  Age,   Sept.  27,   1917. 


GOVERNMENT    CONTROL   OVER  PRICES.  253 

commissioner  showed  that  producers  within  the  first  of  these  classes 
generally  have  the  lowest  costs,  and  that  those  within  the  last  class, 
which  make  up  a  fair  percentage  of  the  total  number  of  producers, 
have  the  highest  costs. 

These  data,  and  others  like  them,  made  the  Government  exceed- 
ingly fearful  of  reducing  prices  to  a  strict  cost  basis,  lest,  through  a 
scaling  clown  of  prices,  the  production  be  diminished.  It  was  at 
one  time  suggested  that  there  be  devised  a  pooling  agreement  be- 
tween producers  which  would  provide  that  the  profits  of  low-cost 
producers  be  shared  with  those  of  high-cost  producers.  The  para- 
mount desire  of  the  Government  to  maintain  production  of  steel 
at  its  maximum  made  it  take  no  chance  with  too  drastic  measures. 
It,  therefore,  determined  to  fix  the  maximum  prices  by  a  flat  rate 
and  at  a  point  high  enough  to  keep  substantially  in  full  operation 
every  mill  and  blast  furnace  which  contributed  appreciably  to  the 
country's  supply.1 

Should  higher  contract  prices  already  made  be  abrogated. — There 
had  been  made  during  the  market  earlier  in  1917  contract  agree- 
ments for  iron  and  steel  at  prices  much  higher  than  the  Government 
contemplated  fixing  as  a  maximum.  It  was  believed  that  the  Gov- 
ernment, in  fixing  prices  lower  than  outstanding  contract  prices, 
could  not  abrogate  those  contracts.  The  concern  within  the  Govern- 
ment, however,  and  the  industry  over  this  problem  turned  chiefly 
upon  the  advantages  which  would  accrue  to  buyers  who  had  not  con- 
tracted ahead  and  could,  under  the  fixed-price  schedule,  buy  cheaper 
steel  than  had  their  competitors  just  two  months  earlier  under  con- 
tract agreement.  This  problem  resolved  itself  into  a  simpler  one  as 
time  passed  because  of  the  moderate  policy  adopted  by  the  Govern- 
ment and  the  fair  point  at  which  steel  prices  were  put.  The  Govern- 
ment finally  gave  the  industry  full  assurance  that  all  past  contract 
obligations  should  be  carried  out  as  agreed  upon.2 

Should  the  Government  recognize  the  labor,  fuel,  and  transporta- 
tion problems. — It  is  noteworthy  that  the  Government,  when  it  set 
about  controlling  steel  prices,  was  confronted  at  once  with  the  solu- 
tion of  incidental  labor,  fuel,  and  transportation  problems  that  had 
for  some  time  puzzled  the  industry.  The  Government  found  it  neces- 
sary to  take  into  its  deliberations  a  consideration  of  these  very  ma- 
terial factors  which  help  to  determine  the  market  price  of  steel. 

Should  account  be  taken  of  the  middlemen. — The  concentration  of 
iron  and  steel  production  in  the  hands  of  relatively  few  producers 
made  it  simpler  to  control  prices  at  the  source  than  in  some  other 

1  See  article  by  Abraham  Berglund  on  "  Price  Fixing  in  the  Iron  and  Steel  Industry," 
in  the  Quarterly  Journal  of  Economics  for  August,  1918. 

a  Iron  Age,  July  19,  1917,  p.  142.     See  also  ibid.,  Oct.  4,  1917,  p.  832. 


254  HISTORY   OF   PRICES   DURING   THE   WAR. 

industries.  A  price  may  be  fixed  for  a  producer,  but  where  the 
product  passes  through  the  hands  of  the  jobber  to  the  ultimate  con- 
sumer the  jobber's  interest  in  the  fixed  price  is  that  of  purchaser  and 
not  that  of  seller.  An  interesting  phase  of  this  problem  was  the  at- 
tempt of  the  American  Steel  &  Wire  Co.,  which  controls  over  half 
the  wire  output  of  the  country,  to  check  the  upward  movement  of 
prices  by  selling  wire  nails  at  $3.20  per  keg  when  they  were  quoted 
at  $4  per  keg.  Independents  in  several  cases  were  selling  wire  nails 
at  $4,  and  the  jobbing  trade  began  basing  its  sales  to  retailers  on 
the  $4  price  at  mill.  Thus  in  several  instances  $4.50,  and  in  Phila- 
delphia $5,  were  charged  on  sales  to  retailers. 

The  practices  of  trade  with  reference  to  dealers  or  jobbers  were 
also  phases  of  the  same  problem.  Furnace  coke  is  not  usually  sold 
through  dealers,  whereas  the  great  bulk  of  foundry  coke  is.  In  fix- 
ing the  necessary  differential  between  furnace  and  foundry  coke  the 
dealer's  compensation  should  be  provided  for.  Again,  a  rule  applica- 
ble to  one  class  of  dealers  may  not  be  applicable  to  another  class. 
Foundry  coke  and  steel  bars  or  plates  are  both  sold  through  dealers, 
but  there  is  no  relation  whatever  between  the  dealer  in  coke  and 
the  dealer  in  steel  bars  and  plate.  In  the  case  of  the  former,  busi- 
ness is  often  done  on  a  brokerage  basis,  whereas  in  steel  bars  there 
is  practically  no  brokerage  business.  There  is,  furthermore,  the 
divergence  with  reference  to  price  practices.  The  coke  dealer  or 
broker  frequently  buys  at  an  inside  price,  or  something  less  than 
that  at  which  the  coke  operator  would  sell  directly  to  a  consumer, 
while  the  jobber  in  steel  products  often  pays  a  higher  price  than 
that  at  which  the  mill  sells  direct  to  the  large  consumer.  It  is  the 
usual  case  in  a  rising  market  for  mills  to  sell  bars,  sheets,  etc.,  for 
shorter  periods  to  jobbers  than  to  manufacturing  consumers.  The 
jobber  pays  a  higher  price,  but  his  business  is  profitable  because  he 
furnishes  deliveries.  The  middleman  in  certain  branches  of  the  iron 
and  steel  trade  is  still  a  problem,  and  there  has  been  some  disposition 
to  criticize  the  price-fixing  policy  of  the  Government  in  largely  ignor- 
ing the  importance  of  the  jobber  and  trade  practices  of  the  kind 
referred  to.  It  must  be  said,  however,  that  over  a  great  part  of  the 
industry  the  middleman  does  not  play  anything  like  so  important  a 
role  as  in  many  other  industries,  and  the  problem  of  regulating  prices 
in  intermediate  sales  has  been  on  the  whole  relatively  simple.1 

Raw-material  prices  fixed  September  &4i  1917. — Events  fore- 
shadowing a  control  over  iron  and  steel  came  fast  and  thick  at  the 
War  Industries  Board,  after  the  middle  of  September  in  1917.  Mr. 
J.  L.  "Replogle,  at  the  request  of  the  board,  on  September  14,  submitted 

1The  materials  for  this  paragraph  on  the  middlemen  (based  upon  the  Iron  Age,  July 
19,  1917,  p.  146,  and  ibid.,  Oct.  4,  1917,  pp.  828,  829),  were  taken  bodily  from  Mr. 
Berglund's  article. 


GOVERNMENT   CONTROL   OVER  PRICES.  255 

a  report  of  the  iron  and  steel  situation,  urging  that  the  steel  men  be 
called  at  once  to  Washington  for  a  conference,  that  an  immediate 
step  be  taken  to  alleviate  the  chaotic  steel  situation,  and  outlining  in 
more  detail  the  condition  peculiarly  demanding  maximum  production 
of  coke,  pig  iron,  sheared  plates,  shell  steel,  billets  and  rounds.  It 
was  recommended,  furthermore,  that  there  be  fixed  upon  those  items 
prices  to  take  effect  "at  the  earliest  possible  date." 1 

1  The  text  of  Mr.  Replogle's  report  follows : 

In  compliance  with  your  request,  I  inclose  herewith  a  memorandum  showing  my  ideas 
as  to  prices  on  various  iron  and  steel  products.  Whatever  prices  are  determined  upon 
should  be  put  into  effect  at  the  earliest  possible  date,  as  conditions  in  the  steel  line 
are  in  an  extremely  chaotic  condition,  and  I  believe  many  manufacturers  in  anticipation 
of  what  they  consider  very  low  prices  to  be  established  on  steel  products,  are  giving 
right  of  way  in  their  mill  operations  to  the  more  profitable  product  suc^h  as  are  pur- 
chased by  the  automobile  manufacturer  who  is  willing  to  pay  the  exorbitant  prices 
asked  if  he  can  secure  delivery,  with  the  result  that  too  much  steel  is  going  into  non- 
essentials  and  entirely  too  little  into  war  necessities. 

Certain  manufacturers  *  *  *  have  given  us  every  cooperation,  while  others  have 
shown  a  very  indifferent  attitude.  Despite  the  fact  that  the  output  of  *  *  *  is  only 
about  50  per  cent  of  the  total  capacity  of  the  country,  they  have  taken  approximately 
70  per  cent  of  all  the  orders  placed  by  the  United  States  Government  and  in  many 
cases  the  prices  were  far  below  their  competitors,  and  in  all  cases  where  asked  to  do  so, 
they  have'  taken  orders  subject  to  the  Government  prices  to  be  established,  based  on  the 
Federal  Trade  Commission  report  as  to  cost.  When  prices  are  established  and  priority 
schedules  are  out,  I  believe  most  of  the  others  will  fall  into  line. 

Products  most  essential  to  war. — The  products  most  essential  to  the  war  and  on  which 
we  must  have  the  maximum  production  are  coke,  pig  iron,  sheared  plates,  shell  steel 
billets  and  rounds.  I  believe  on  the  products  most  needed  that  it  would  be  well  to  es- 
tablish a  stimulating  price,  as  in  most  cases  a  steel  manufacturer  has  a  finishing  capacity 
far  in  excess  of  his  ingot  capacity,  this  being  due  to  the  fact  that  in  normal  times  one 
line  or  another  may  be  Inactive  and  the  demands  on  other  products  will  be  such  that  he 
can  work  up  through  other  lines  his  entire  ingot  production. 

The  situation  on  the  various  products  is  about  as  follows  : 

Coke. — The  total  production  of  coke  in  1916  was  approximately  54,000,000  tons, 
about  35,000,000  tons  or  65  per  cent  of  which  was  Beehive  coke  and  about  19.000,000 
or  35  per  cent  being  made  in  by-product  ovens.  Owing  to  the  Insufficient  car  supply  and 
shortage  of  labor,  the  production  of  Beehive  coke  has  fallen  off  in  a  very  serious  way 
during  the  past  five  or  six  months,  with  the  result  that  the  price  has  gone  as  high  as 
$17  at  the  ovens,  as  compared  to  an  average  price  of  about  $2.20  during  the  past  10 
years.  The  Connellsvllle  ovens  are  now  running  at  the  rate  of  about  70  per  cent  ca- 
pacity, and  are  losing  about  20  per  cent  of  their  output  on.  account  of  labor  shortage 
and  10  per  cent  on  account  of  car  service  and  other  causes.  Coke  will  be,  I  think,  the 
limiting  factor  in  our  iron  and  steel  production,  although  the  shortage  of  iron  ore  may 
also  be  a  contributing  element. 

Iron  ore. — On  Sept.  1,  the  shipment  to  lower  lake  ports  was  about  3,000,000  tons  less 
than  the  same  time  last  year,  this  being  largely  due  to  the  late  opening  of  lake  naviga- 
tion and  insufficient  vessel  capacity  and  more  particularly,  inadequate  car  service  at 
lower  lake  points.  This  matter  Is  receiving  every  consideration  by  the  ore  committee, 
but  I  strongly  recommend  that  the  movement  to  take  about  86  vessels  from  the  Great 
Lakes  for  use  in  ocean  traffic  be  dropped,  as  the  boats  are  badly  needed  for  the  ore 
carrying  trade.  In  order  to  take  them  through  the  Welland  Canal  and  make  them 
serv'jeable,  an  enormous  amount  of  labor  and  money  would  be  necessary  to  cut  them  in 
half  and  repair  them  and  even  after  this  was  done,  they  would  not  be  suitable  for  ocean 
traffic.  I  understand  that  of  the  86  boats  under  consideration,  37  of  them  are  packet 
boats  which  can  be  spared.  The  ore  consumption  in  1916  was  approximately  57,000,000 
tons,  and  the  annual  capacity  now  with  about  19  new  furnaces  in  blast  is  about  64,000,000 
tons,  and  if  the  86  boats  are  taken  from  the  lake  trade,  it  wtould  cut  their  tonnage  to 
the  extent  of  probably  3,500,000  tons  annually,  which  would  seriously  cripple  the 
industry. 

Pig  iron. — The  output  for  1916  was  approximately  39,500,000  tons,  but  the  produc- 
tion of  iron  in  the  first  half  of  this  year  was  considerably  under  the  previous  six  months, 
this  being  largely  due  to  the  shortage  of  coke  and  labor.  Most  of  the  furnaces  make 


256.  HISTORY  OF   PRICES  DURING  THE  WAR. 

The  War  Industries  Board,  four  days  later,  called  its  committee1 
into  a  special  meeting  and  asked  for  views  of  the  proper  method  to 
be  followed  in  fixing  the  price  of  steel.  The  committee  reported 
that  they  had  examined  the  cost  figures  found  by  the  Federal  Trade 
Commission  on  coke,  iron  ore,  pig  iron,  and  steel  products.  They 
believed  in  general,  however,  that  those > data  really  reflected  the 
prevailing  condition  of  a  year  previous  since  the  materials  used 
during  the  first  half  of  1917  had  been  contracted  for  then.  The 
committee  made  recommendations  relative  to  the  methods  of  con- 
trol and  they  emphasized  certain  phases  of  it  which  proved  later 
to  be  vital  factors  in  the  whole  scheme  of  iron  and  steel  regulation. 
It  said  in  part  that— - 

It  is  our  judgment  that  the  question  of  price  fixing  may  be  best  approached 
by  considering  the  individual  processes  or  stages  comprising  the  manufacture 
of  the  finished  product.  Each  of  these  practically  constitutes  an  independent 

iron,  of  course,  only  for  their  own  use  and  the  average  monthly  production  for  sale 
during  the  first  six  months  of  this  year  was  about  940,000  gross  tons.  The  sales 
obligations  of  the  various  manufacturers  on  July  21,  1917  were  8,233,130  tons,  of  which 
about  250,000  tons  were  for  export  largely  to  Canada,  Great  Britain,  Italy,  and  Japan. 
From  this  you  will  note  that  the  merchant  furnace  production  of  the  country  is  sold  up 
for  a  little  over  nine  months.  There  has  been  a  great  increase  in  steel  making  capacity, 
but  the  production  of  iron  has  not  kept  pace  with  it.  A  number  of  our  Allies,  par- 
ticularly Italy,  are  in  the  market  for  very  heavy  tonnages,  and  I  think  their  necessi- 
ties are  such  that  they  can  not  be  denied. 

Plates. — Supplementing  my  letter  of  the  30th  ultimo,  I  consider  plates  about  the 
weakest  link  in  our  chain.  The  total  production  of  sheared  and  universal  plates  ir 
1916,  which  was  a  record  year,  was  3,687,384  tons,  of  which  1,224,234  tons  were  uni- 
versal mill  plates  not  adaptable  to  any  great  extent  for  ship  construction.  As  a  matter 
of  fact,  the  production  of  sheared  plates  \  inch  or  over  was  1,865,642  tons.  The  sales 
obligations  of  the  various  plate  manufacturers  as  of  July  21  last  total  about  2,300,000 
tons  and  the  requirements  of  the  Shipping  Board  and  of  the  Navy  and  Army  to  the  end 
of  1918  will  approximate  1,750,000  tons,  so  that  it  is  plain  that  we  have  fully  two  solid 
years  maximum  operation  now  in  sight,  without  taking  into  consideration  the  needs  of 
our  allies,  which  will  be  very  heavy.  The  British  war  mission  is  now  trying  to  secure 
right  of  way  on  a  plate  specification ;  the  Italian  mission)  informs  us  that  their  re- 
quirements will  also  be  quite  heavy,  and  Japan  wants  an  enormous  tonnage.  Of  the 
425,556  tons  of  plates  for  export  on  the  books  of  the  plate  manufacturers  July  21  last, 
292,000  or  about  68  per  cent  were  for  shipment  to  Japan,  and  about  70,000  tons  for 
shipment  to  Canada.  If  we  continue  to  permit  the  export  of  plates,  it  is  plain  that  the 
output  of  our  own  ship  yards  will  be  restricted.  I  can  not  too  strongly  impress  upon  you 
the  grave  situation  in  this  particular  line.  There  was  considerable  new  plate  capacity 
under  serious  consideration  some  months  ago  ;  in  fact,  some  of  the  work  on  the  mills 
had  already  been  started,  when  for  some  reason  construction  was  called  off  at  the  time 
Government  prices  on  plates  were  discussed  by  representatives  of  the  Government  and 
the  manufacturers. 

If  the  demand  for  pipes  and  tubes  can  be  reduced  by  discouraging  building  construc- 
tion and  all  nonessential  work  of  this  character,  these  skelp  mills  could  be  used  to  very 
great  advantage  on  ship  plates.  I  think  that  this  is  one  of  the  greatest  possibilities  we 
have  and  it  must  promptly  be  taken  advantage  of  by  some  one  in  authority. 

In  view  of  the  above  conditions,  which  I  consider  most  serious  to  our  war  program, 
I  believe  a  stimulating  price  on  plates  would  be  advisable  to  encourage  the  mills  in  ex- 
erting every  possible  influence  for  maximum  tonnage  from  their  existing  mills,  and  also 
to  influence  new  construction. 

Projectile  steel. — The  situation  in  this  line  is  equally  as  bad  as  on  plates.  The  re- 
quirements of  this  Government  for  the  next  year  will  approximate  1,600,000  tons.  The 
British  war  mission  advise  us  that  they  have  approximately  700,000  tons  now  on  order 
with  various  plants  in  this  country  which  have  not  yet  heen  delivered,  and  their  require- 
ments will  be  at  least  1,000,000  tons  additional.  Italy  wants  about  40,000  tons  and 
Belgium  about  28,000  tons,  making  a  total  of  3,368,000  tons.  I  have  not  yet  been  able 


GOVERNMENT   CONTROL   OVER  PRICES.  257 

industry.  Many  of  the  operators  are  engaged  in  only  one  of  the  processes, 
while  a  few  of  the  larger  companies  cover  all  operations  from  the  raw  material 
to  the  finished  product.  As  each  industry  must  be  allowed  a  profit  to  sup- 
port that  particular  industry,  the  integrated  companies  who  cover  all  processes 
from  raw  materials  to  highly  finished  products  must  necessarily  receive  a 
profit  on  each  of  the  processes. 

Conditions  prevailing  in  the  steel  trade  for  a  considerable  period  made  it 
necessary  for  all  lines  of  industry  using  steel  products  to  order  their  supplies 
further  in  advance  than  would  be  necessary  under  normal  conditions,  and  as 
a  consequence  these  industries  have  on  hand  substantial  stocks  of  steel  acquired 
at  prices  very  much  higher  than  any  we  could  recommend  as  being  fair  or 
equitable.  To  partially  meet  this  situation  and  avoid  demoralizing  the  many 
industries  that  are  largely  dependent  upon  steel  products,  we  recommend 
the  establishment  of  what  might  be  termed  an  intermediate  scale  of  prices 
for  a  period  of  three"  months  with  the  expectation  of  a  further  reduction  at 
the  end  of  that  period. 

With  that  purpose  in  mind  we  submit  the  attached  schedule  of  proposed 
prices  on  the  raw  materials  and  various  products,  also  showing  the  approxi- 

to  get  the  requirements  of  France  and  Russia,  but  I  assume  that  there  will  be  a  tre- 
mendous tonnage  required  by  them. 

Prior  to  the  war  there  was  comparatively  little  of  this  tonnage  rolled  and  there 
are  practically  no  mills  in  this  country  adapted  particularly  for  this  character  of  prod- 
uct, as  the  ordinary  bar  mill  is  designed  more  particularly  for  bars  of  4  inch  to,  say, 
2  inch  diameter,  and  the  shell  steel  in  this  country  is  largely  rolled  on  rail  mills  and 
heavy  structural  mills,  and  the  rolling  of  this  tonnage  on  these  mills  displaces  a  very 
much  heavier  tonnage  of  the  products  for  which  the  mills  were  designed. 

We  have  had  the  greatest  difficulty  in  placing  a  small  requisition  for  about  30,000 
tons  for  the  Ordnance  Department,  as  all  the  mills  are  filled  up  largely  on  foreign  orders. 
The  British,  Italian,  and  Belgian  missions  are  all  pushing  us  for  deliveries  on  their 
requirements  in  this  line,  and  to  place  additional  tonnages,  which  we  can  not  see  any 
possibility  of  their  getting,  without  a  serious  shortage  in  our  own  requirements.  We 
are  giving  this  subject  a  lot  of  detailed  study,  but  we  can  not  see  any  possible  chance 
of  meeting  our  requirements  in  this  line,  unless  something  is  done  promptly  to  prevent 
the  manufacture  of  the  enormous  tonnage  of  steel  going  into  nonessentials. 

I  believe  on  the  larger  shells  we  will  have  to  go  to  the  steel  casting  companies,  al- 
though I  understand  the  War  Department  is  not  very  favorable  to  this.  This  has  been 
done  by  some  of  the  foreign  governments  in  an  emergency,  and  I  believe  we  will  have  to 
come  to  it  here,  which  will  help  the  situation  to  some  extent,  but  not  greatly. 

A  very  serious  complication  is  the  closing  of  shell  factories  in  Canada,  where  they 
have  a  capacity  of  400,000  shells  per  day,  which  is  considerably  in  excess  of  the  out- 
put in  this  country.  I  have  talked  with  three  of  the  Canadian  munition  manufacturers 
who  state  they  propose  to  change  their  factories  to  other  lines  of  product,  as  they  can  not 
get  additional  shell  orders  from  the  British  Government,  which  insists  that  Canada 
must  finance  their  own  requirements  in  this  line,  which  they  state  they  are  unable  to 
do,  and  according  to  the  terms  of  the  United  States  Government's  loan  to  Great  Britain, 
this  money  can  only  be  used  for  purchases  in  this  country,  with  the  result  that  they  are 
trying  to  divert  this  Canadian  business  to  us.  They  have  been  consuming  225,000  tons 
of  shell  steel  monthly  in  Canada,  about  190,000  tons  of  which  was  supplied  by  the 
Canadian  steel  plants,  and  approximately  35,000  tons  imported  from  this  country. 

I  certainly  feel  that  some  arrangement  should  promptly  be  made  to  continue  the  manu- 
facture of  shell  steel  and  finished  shells  in  Canada,  and  understand  that  negotiations 
are  now  on  with  this  object  in  view. 

teumiiiary. — As  previously  advised,  coke,  pig  iron,  plates,  and  projectile  steel  will  be 
the  most  serious  factors  in  the  steel  situation.  The  situation  on  structural  steel,  pipe, 
and  tubes,  wire  products,  rails,  merchant  bars,  etc.,  is  approximately  as  reported  in  my 
letter  of  the  30th  ultimo.  These  lines  will  all  have  to  be  materially  curtailed  in  order 
to  meet  the  absolute  war  necessities.  I  again  recommend  that  the  leading  steel  manu- 
facturers be  called  to  Washington  at  the  earliest  possible  date  for  a  full  discussion  of 
the  serious  condition,  with  the  hope  that  immediate  action  will  be  taken  to  improve  it, 
as  we  can  not  continue  on  the  present  basis  without  most  serious  results. 

1  Mr.  J.a  Leonard  Replogle,  Alex.  Legge,  and  L.  L.  Summers. 

125547*— 2( 


258  HISTORY  OF   PRICES  DURING  THE  WAR. 

mate  market  prices  at  the  present  time  and  the  amount  of  the  reduction  from 
such  prices. 

This  scale  of  prices  is  recommended  on  the  basis  of  offering  a  premium  on 
ship  plates  and  shell  steel  with  the  object  of  stimulating  production,  as  the 
present  capacity  is  inadequate  to  meet  the  requirements. 

It  is  evident  that  to  be  effective  any  price  regulations  must  be  rigidly  en- 
forced. Serious  consideration  should  be  given  to  the  question  of  abrogating 
contracts  which  were  entered  into  prior  to  establishing  this  suggested  schedule 
of  prices.  We  have  asked  the  Federal  Trade  Commission  to  advise  the  War 
Industries  Board  further  in  regard  to  these  contracts,  which  must  be  consid- 
ered an  important  factor  in  the  situation  as  some  furnaces  have  entered  into 
contracts  without  regard  to  the  price  established  on  coal. 

The  War  Industries  Board  on  September  18,  1917,  after  hearing 
the  above  report  in  substance,  agreed  that  the  prices  of  ore,  coal, 
coke,  transportation,  and  pig  iron  should  be  fixed  separately  and 
thus  build  up  a  fair  price  for  steel.  It  was  likewise  then  agreed 
that  should  the  steel  interests  not  be  willing  to  give  their  full  co- 
operation because  of  the  prices  being  fixed,  that  the  War  Industries 
Board  would  take  the  steps  necessary  to  assume  control  over  the 
steel  plants.1 

The  prices  fixed  on  the  great  basic  raw  materials  of  the  iron  and 
steel  group,  which  proved  later  to  have  been  the  basis  for  all  price 
fixing  within  that  group,  were  announced  by  the  President  on  Sep- 
tember 24,  1917,  but  were,  in  point  of  fact,  fixed  by  an  oral  agree- 
ment between  the  War  Industries  Board  and  the  industry  on  Sep- 
tember 21,  1917.  The  iron  and  steel  industry  of  the  country,  as  rep- 

1  A  chief  concern  of  the  War  Industries  Board,  in  fixing  the  prices  of  iron  and  steel, 
was  to  maintain  production  at  a  maximum.  It  is  therefore  of  interest  to  note  that  on 
Sept.  18,  1917,  the  chief  of  the  board's  production  committee,  Mr.  S.  M.  Vauclain,  pre- 
pared a  memorandum  stating  the  production  of  ore,  coke,  pig  iron,  and  plates  should  be 
stimulated.  Mr.  Vauclain  gave  it  as  his  confident  belief  that  the  maximum  production 
of  the  mills  would  be  assured  should  the  Board  establish  prices  substantially  in  con- 
formity to  those  recommended  by  him  as  follows : 

Of  course  the  cost  of  pig  iron  must  necessarily  regulate  the  price  of  steel  and  the 
price  of  pig  iron  naturally  depends  upon  the  price  of  ore  and  coke.  There  are  four  items 
which  should  be  stimulated  so  that  no  question  of  labor  or  profit  should  arise  in  their 
production  and  the  minimum  price  should  be  named  that  will  secure  for  the  United 
States  the  maximum  production,  as  follows  :  Ore,  coke,  pig  iron,  and  plates  ;  therefore,  I 
suggest  to  you  the  following  : 

(1)  Ore. — Ore  is  now  sold  at  lake  ports,   at  Mesabi,   at   $5.05   and  at  Old  Range   at 
$5.20.     Such  Cuban,  Spanish,  and  Chilean  ore  as  it  is  possible  to  bring  in  costs  about  the 
same  at  plants  along  the  Atlantic  seaboard,  therefore  it  is  suggested  that  the  price  of 
$5  per  ton  at  lake  ports  should  be  the  price  to  all  for  ore. 

(2)  Coke. — There  is  universal  regret  among  manufacturers  that  the  price  of  coal  has 
been  placed  at  $2.     It  is  considered  a  grave  mistake  and  that  $3  coal  would  have  brought 
about   a   maximum    production    of   this   much-needed   article.      Therefore,   we   should   not 
make  the  same  mistake  on  coke.     The  cost  of  beehive  coke  is  usually  practically  the  cost 
of  two  tons  of  coal  plus  $1.     It  is  therefore  suggested  that  the  price  of  coke,   without 
distinction  between  beehive  or  by-product,  should  be,  at  the  Connellsville  district,  $6. 

(3)  Pig  iron. — At  the  present  time  there  is  at  most  blast  furnaces  large  quantities  of 
fuel  and  ore  which  will  make  operation  safe,  which  has  been  purchased  at  ruling  market 
prices.      Therefore,    in  order  to   enable  the   manufacturer   to   work    off   this   high   priced 
material,  I  suggest  the  following  rates  for  pig  iron  :  $35  per  ton  from  Oct.   1,  1917,  to 


GOVEKNMENT   CONTROL   OVER   PRICES. 


259 


resented  by  65  high  officials,  met  the  War  Industries  Board  at  Wash- 
ington about  10  o'clock  on  the  morning  of  September  21,  at  the  call 
of  the  board.  The  steel  men  were  told  that  the  President  had  re- 
quested the  board  to  ask  their  opinions  as  to  proper  prices  to  be 
fixed.  An  informal  discussion  took  place  on  the  basis  of  data  at 
hand  and  in  mind  and  then  "the  meeting  adjourned  until  4  p.  m. 
to  give  the  steel  interests  the  opportunity  of  discussing  the  proper 
prices  to  fix."  1 

When  the  meeting  reconvened  at  4  p.  m.  Judge  E.  H.  Gary,  speak- 
ing for  the  steel  industry,  explained  to  the  board  that  the  steel  inter- 
ests had  appointed  committees  covering  ore,  coke,  and  pig  iron  and 
that  those  committees  would  make  and  explain  their  recommenda- 
tions. The  suggestions  made  by  these  committees  were  virtually  the 
prices  adopted  by  the  board  and  later  announced  by  the  President.  It 
is  of  especial  interest,  therefore,  to  read  in  detail  the  specific  recom- 
mendations formally  made  to  the  board  by  the  steel  committees,  of 
prices  which  they  considered  fair  and  proper.  The  minutes  of  the 
War  Industries  Board  for  that  day  say : 

Ore. — The  committee  on  ore  then  stated  that  the  ore  sold  last  year  for  this 
year's  consumption  was  on  a  basis  of  $5.05  per  ton,  lower  lake  port,  for  non- 
Bessemer  Mesabi  ore.  They  suggested  that  the  same  price  might  be  considered 
fair  for  the  ore  to  be  purchased  this  fall  for  consumption  from  June,  1918,  to 
June,  1919,  provided  that  wages  for  labor  and  cost  of  transportation  remained 
the  same.  If  they  did  not,  a  corresponding  increase  in  price  should  be  allowed. 
They  stated  that  the  profits  for  last  year  were  higher  than  the  average  for 
previous  years,  but  not  as  high  as  they  have  been  in  certain  years  of  the  past. 

Jan.  1,  1918  ;  $32.50  per  ton  from  Jan.  1,  1918,  to  Apr.  1,  1918  ;  and  $30  per  ton  there- 
after, it  having  been  ascertained  that  with  regulated  prices  for  ore  and  coke  any  blast 
furnace  in  the  United  States  can  produce  with  a  fair  profit  pig  iron  at  the  last-named 
price.  Therefore,  at  the  above  prices,  I  suggest  the  following  schedule  : 


Item. 

Oct.  1, 
1917,  to 
Jan.  l, 
1918. 

Jan.  1, 
1918,  to 
Apr.  1, 
1918. 

There- 
after. 

Pig  iron 

|35  00 

$32  50 

$30  00 

Steel  ingots  

45.00 

42  50 

40  00 

Blooms. 

54  00 

51  50 

49  oo 

Billets. 

55  00 

52  50 

50  00 

Slabs  

55  00 

52.50 

50  00 

Bars  

65.00 

62.00 

60.00 

Shapes 

67  00 

64  50 

62  00 

Plates  

77  00 

74  50 

72  00 

Steel  rails  (light  special) 

65  00 

62  50 

60  00 

In  each  step  the  manufacturer's  profit  has  been  included.  You  will  note  at  these  prices  that  the  base 
price  of  plates  will  be  3.437,  3.321,  and  3.215  per  pound.  I  feel  confident  that  should  prices,  approximately 
in  conformity  with  these  figures,  be  established  that  the  maximum  production  of  our  mills  would  be  assured. 
There  would  also  be  an  incentive  for  new  capital  to  get  into  this  business,  as  there  would  be  small  chance 
of  making  an  actual  loss  and  the  patriotism  of  our  manufacturers  would  be  more  active  toward  a  higher 
production  of  steel  products,  and  unless  we  do  have  a  higher  production  of  steel  products  the  war  will  be  a 
slow  and  tedious  process. 

1  The  War  Industries  Board  Minutes  for  Sept.  21,  1917. 


260  HISTORY   OF   PRICES   DURING   THE   WAR.  ti 

Roughly  speaking,  they  stated  that  the  profit  per  ton  last -year  was  approxP*" 
mately  $1.     It  was  understood  that  the  usual  differential  nbtg&ing  in  the  trade 
for  higher  grades  of  ore  should  be  considered  operative. 

Coke. — The  committee  covering  coke  stated  that  they  considered  a  price  of 
$6.50  per  ton  ovens  for  coke  should  be  established,   /udge  Gary  stated  that  he 
thought  $6  a  ton  would  allow  a  sufficient  margin;  Mr.  Schwab  .confirmed  Judge i. 
Gary's  statement. 

Pig  iron. — The  committee  covering  pig  iron  stated  that  in  their  opinion  $35*- 
a  ton  valley  for  basic  iron  would  permit  of  90  per  cent  of  the  blast  furnaces 
operating  at  a  profit,  and  if  coke  can  be  established  at  $6  ovens,  $30  pig  iron£ 
is  fair.    Some  exception  was  taken  to  this,  largely  because  of  the  fact  that  con- 
tracts for  coke  at  high  prices  for  future  delivery  had  been  placed  by  .many 
furnaces. 

Steel. — Mr.  Schwab  presented  figures  showing  that  if  a  profit* tJf '15  per  cent 
were  allowed,  ingots  should  sell  at  $52.25  a  gross  ton,  billets  at  $60.30  a  gross 
ton,  and  plates  at  $85.30  a  gross  ton.     The  representative  -«f*t'he  Lukens  IronN 
&  Steel  Co.  stated  that  if  pig  iron  were  fixed  at  $35  per  ton,  plates  would  cost, 
him  on  a  basis  of  $3.45  per  hundred  pounds.  *s 

The  members  of  the  War  Industries  Board  retired  from  the,' meeting  to  per- 
mit the  steel  interests  to  suggest  prices  on  these  commodities?"  which,  in  their 
opinion,  would  be  for  the  greatest  benefit  of  the  Nation. 

The  board  was  then  waited  upon  by  a  special  committee  appointed  by  the 
steel  interests,  consisting  of  Judge  Gary,  Mr.  Schwab,  and  Mr.  Dalton,  who 
presented  certain  figures  as  being  acceptable  to  the  steel  interests,  whereupon 
the  board  informed  them  that  at  the  earliest  opportunity  they  would  wait  upon 
the  President  relative  thereto. 

One  of  the  most  striking  of  all  the  features  of  the  early  fixing  of 
iron  and  steel  prices  was  the  informality  of  it  and  the  reliance  of  the 
whole  scheme  upon  a  cordiality  between  the  Government  and  the 
industry.1 

The  fruit  of  all  these  confidential  meetings  came  finally  to  a  full 
public  knowledge  on  September  24,  1917,  when  the  President  ap- 
proved the  prices  therein  determined  upon  by  fixing  the  following 

1  Judge  R.  S.  Lovett,  acting  chairman  of  the  War  Industries  Board,  on  Sept.  25,  1917 
wrote  the  following  letter  to  Judge  E.  H.  Gary,  authorized  spokesman  for  the  steel 
industry  : 

"  This  is  to  confirm  the  oral  agreement  between  the  War  Industries  Board  and  your- 
self and  other  representatives  of  the  steel  industry,  arrived  at  on  Sept.  21  and  approved 
by  the  President,  as  announced  by  him  on  Sept.  24,  1917,  fixing  the  following  prices 
which  became  effective  immediately  and  are  subject  to  revision  Jan.  1,  1918,  for 
the  articles  mentioned,  viz  :  Iron  ore,  lower  Lake  ports  basis,  $5.05  per  gross  ton  ;  coke, 
Connellsville  basis,  $6  per  net  ton  ;  pig  iron,  Valley  basis,  $33  per  gross  ton  ;  steel  bars, 
Pittsburgh  and  Chicago  basis,  $2.90  per  hundred  ;  steel  shapes,  Pittsburgh  and  Chicago 
basis,  $3  per  hundred  ;  and  steel  plates,  Pittsburgh  and  Chicago  basis,  $3.25  per  hun- 
dred. Also,  first,  that  there  should  be  no  reduction  in  the  present  rate  of  wages ;  second, 
that  the  prices  above  named  shall  be  made  to  the  public  and  to  the  nations  associated 
with  the  United  States  in  the  present  war  with  Germany,  as  well  as  to  the  Government 
of  the  United  States;  and,  third,  that  the  steel  producers  represented  at  the  meeting 
pledge  themselves  to  exert  every  effort  necessary  to  keep  up  the  production  to  the  maxi- 
mum of  the  past  so  long  as  the  war  lasts.  Will  you  or  those  associated  with  you  in  the 
negotiations  referred  to  please  take  up  promptly  or  send  representatives  here  to  take  up 
with  Messrs.  Baruch  and  Lovett  the  details  for  working  out  the  placing  of  orders,  the 
settlement  of  questions  of  priority,  etc.,  and  other  matters  necessary  for  carrying  out 
the  arrangement,  and  oblige?" 


GOVERNMENT   CONTROL   OVER  PRICES.  261 

basic  prices  effective  immediately  and  subject  to  revision  January  1, 
1918,  viz: 


Commodity. 


Basis.  Price. 


Iron  ore          ;  Lower  Lake  ports $5.05  per  gross  ton. 

Coke Connellsville !  $6  per  net  ton. 

Pig  i  r  on 

Steel  bars I  Pittsburgh-Chicago 

Shapes do 

Plates...  do 


$33  per  gross  ton. 
$2.90  per  100  pounds. 
$3  per  100  pounds. 
$3.25  per  100  pounds. 


It  was  made  a  part  of  the  informal  oral  agreement  between  the 
War  Industries  Board  with  the  steel  men,  and  announced  with  the 
above  price  schedule  as  a  policy  by  the  President,  first,  that  there 
should  be  no  reduction  in  the  present  rate  of  wages ;  second,  that  the 
prices  above  named  should  be  made  to  the  public  and  to  the  Allies, 
as  well  as  to  the  Government ;  and  third,  that  the  steel  men  pledge 
themselves  to  exert  every  effort  necessary  to  keep  up  the  production 
to  the  maximum  of  the  past,  so  long  as  the  war  lasts.1  The  Presi- 
dent at  the  same  time  directed  that  measures  be  taken  by  the  War 
Industries  Board  for  placing  orders  and  supervising  the  output  of 
the  steel  mills  in  such  manner  as  to  facilitate  the  requirements  of  the 
Government  and  the  Allies  for  war  purposes,  and  the  public  needs 
where  practicable. 

The  prices  fixed  by  the  War  Industries  Board  did  not  represent 
reductions  as  enormous  as  many  people  believed  the  elaborate  Fed- 
eral Trade  Commission  inquiries  into  costs  justified.  They  were, 
though  generally  below  the  historic  high-price  level  of  July  previous, 
all  materially  higher  than  the  average  prices  prevailing  for  those 
same  commodities  during  1911-1914.  The  falling  off  in  quoted  prices 
for  iron  and  steel,  due  in  part  to  the  knowledge  of  forthcoming  Gov- 
ernment regulation,  began  immediately  after  the  July  market.  The 
prices  fixed  by  the  board  represented  a  considerable  scaling  down 
from  the  July  prices  as  is  strikingly  emphasized  by  the  downward 
and  then  level  turn  of  the  iron  and  steel  index  number  earlier  in  the 
chapter.  Coke  was  reduced  in  price  from  $12.75  to  $6,  pig  iron  from 
$55  to  $33,  steel  bars  from  $4.50  to  $2.90,  shapes  from  $6  to  $3,  and 
plates  from  $9  to  $3.25.  It  should,  of  course,  be  remembered  that 
the  very  high  quotations  of  July,  1917,  were  never  realized  in  the 
majority  of  contract  placements.  They  represented  simply  the  ex- 
orbitant prices  which  certain  sales  could  command  because  the  bulk 
of  steel  was  booked  up  under  contract.  The  real  scaling  down  of 
prices  from  the  high  point  of  July,  1917,  therefore,  was  actually  much 

1  Official  Bulletin,   Sept.  25,  1917. 


262 


HISTORY   OF   PRICES   DURING   THE   WAR. 


less  than  one  might  suppose  on  examining  the  above  figures.1  It 
was  quite  as  much  the  object  of  the  Government  to  stabilize  the  mar- 
ket at  a  point  that  would  effect  a  maximum  of  production  as  to  scale 
down  prices  from  higher  levels.  There  follows  a  table  showing  the 
quoted  prices  on  iron  ore,  coke,  pig  iron,  steel  bars,  shapes,  and 
plates  as  they  prevailed  during  1911-1914;  at  their  average  in  July, 
1917 ;  and  as  finally  fixed  by  the  Government  on  September  24,  1917.2 


Price 

Commodity. 

Basis. 

Average 
for  years 

Average 
for  July, 

fixed  by 
Govern- 

1911-1914. 

1917. 

Sept.  24, 

1917. 

Iron  ore  (non-Bessemer,  51  50  per  cent  iron), 

Lower  lake  ports 

$3.15 

$5.05 

$5.05 

per  gross  ton. 

Coke  (blast  furnace),  per  net  ton  

Connellsville 

2.05 

13.42 

6/00 

Pig  iron  (No  2  foundry  and  basic)  per  gross 

Valley  and  Chicago 

14.90 

52.50 

33  00 

ton. 

Steel  bars  (not  including  sheet  steel  and  small 
shapes  under  3  inches  per  pound),  per  cwt. 

Pittsburgh  or  Chicago.  .  . 

1.31 

4.50 

2.90 

Shapes,  per  cwt 

do 

1.32 

4.50 

3.00 

Plates  (-fy  inch  thick  or  heavier),  per  cwt  

do  

1.32 

9.00 

3.25 

No  better  basis,  for  a  more  detailed  inquiry  into  the  comparison 
of  fixed  prices  with  prevailing  market  quotations,  can  be  had  than 
the  monthly  prices  from  1913  to  1918  of  each  basic  raw  material  that 
was  fixed  on  September  24,  1917  (iron  ore,  coke,  pig  iron,  steel  bars, 
shapes,  and  plates).  The  market  quotations  for  Mesabi,  non- 
Bessemer  (51^  per  cent  iron)  iron  ore  at  the  lower  lake  ports,  which 
was  adopted  as  the  basis  in  fixing  iron  ore  prices,  held  an  average 
price  of  $3.3083  per  gross  ton  for  the  year  just  preceding  the  out- 
break of  war  (July  1, 1913,  to  June  30,  1914),  and  fell  as  low  as  $2.80 
the  latter  part  of  1915.  But  it  reached  a  level  of  $5.05  in  December, 
1916,  which  it  maintained  steadily  to  September,  1917.  The  War  In- 
dustries Board,  at  that  time,  fixed  the  price  at  $5.05.  Connellsville 
coke,  furnace,  prompt  shipment  f.  o.  b.  ovens,  which  was  adopted 
as  the  basis  for  fixing  coke  prices,  was  selling  for  $1.75  per  short 
ton  when  war  broke  out  in  Europe.  During  the  last  quarter  of 
1916  the  market  became  erratic,  and  coke  prices  reached  $9  in  Decem- 
ber of  that  year.  They  remained  enormously  high  during  1917  and 
in  August  attained  a  peak  at  $13.42.  The  War  Industries  Board 
in  September  fixed  the  price  at  $6  per  ton.  The  quotation  of  pig 
iron  f.  o.  b.  Mahoning  or  Shenango  Valley  furnace,  was  $13  per 

1  It  is  aptly  pointed   out  by  Mr.   Berglund  that,   though  considerable   reductions   took 
place  before  the  War  Industries  Board  actually  acted  upon  prices,   the  reductions  made 
by  the  new  schedule  were  material  even  in  the  market  as  it  existed  in  September.     On 
Sept.  20,  four  days  before  the  first  publication  of  fixed  prices,  basic  pig  iron  at  Valley 
furnaces  was  quoted  by  the  Iron  Age  at  $42  per  gross  ton  and  No.  2  foundry  pig  iron, 
Chicago,  at  $54.     Soft  steel  bars,  Pittsburgh,  were  quoted  at  $4  per  hundredweight  and 
tank  plates  at  $8  per  100  pounds. 

2  Made  from  quotations  carried  by  the  Iron  Age  and   "  Maximum  Prices  on  Iron   and 
Steel  Products,"  as  published  by  the  American  Iron  and  Steel  Institute. 


GOVERNMENT   CONTROL   OVER   PRICES. 


263 


gross  ton  when  war  broke  out  in  Europe.  It  began  going  higher 
the  latter  part  of  1915  and  reached  $52.50  in  July,  1917.  The 
War  Industries  Board  fixed  the  price  on  September  at  $33  per 
gross  ton.  The  price  of  steel  bars,  Pittsburgh,  stood  at  $1.12  when 
war  began  but  reached  $4.50  by  the  middle  of  1917.  The  War 
Industries  Board  fixed  the  price  at  $2.90  per  hundred  pounds  in 
September,  1917.  Structural  shapes,  Pittsburgh  (beams  and  chan- 
nels, 3-inch  to  15-inch)  were  selling  at  the  same  level  as  steel  bars 
when  the  war  began  and  reached  the  same  peak  by  the  middle  of 
1917.  The  price  for  shapes  was  fixed  at  $3  per  hundred  pounds  in 
September,  1917.  Steel  plates,  tank  plates  at  Pittsburgh,  were  selling 
at  $1.11  when  the  war  began  but  rose  to  $9  in  July,  1917.  Their  price 
was  fixed  at  $3.25  per  hundred  pounds  in  September,  1917.  There 
follows  a  more  detailed  exhibit  of  the  prices  of  these  articles. 

MARKET  PRICES,  AT   WHOLESALE,  OF  IRON    ORE,  MESABI   NONBESSEMER,  51*  PER 
CENT,   AT   LOWER   LAKE    PORTS.i 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January                         ...           

$3.40 

$3.40 

$2.85 

$3.55 

$5.05 

$5.05 

February 

3.40 

3.40 

2.85 

3.55 

5.05 

5.05 

March    

3.40 

3.40 

2.85 

3.55 

5.05 

5.05 

April 

3.40 

3.40 

2.85 

3.55 

5.05 

5.05 

Mav 

3.40 

2.85 

2.85 

3.55 

5.05 

5.05 

June                        .  .      ..        

3.40 

2.85 

2.85 

3.55 

5.05 

5.05 

July 

3.40 

2.85 

2.80 

3.55 

5.05 

5.05 

August    

3.40 

2.85 

2.80 

3.55 

5.05 

5.50 

September 

3.40 

2.85 

2.80 

3.55 

5.05 

5.50 

October 

3.40 

2.85 

2.80 

3.55 

2  5.05 

5.75 

November            .  .                 

3.40 

2.85 

2.80 

3.55 

5.05 

5.75 

December 

3.40 

2.85 

2.80 

5.05 

5.05 

5.75 

MARKET  PRICES,  AT  WHOLESALE,   OF  CONNELLSVILLE  COKE,   FURNACE,  PROMPT 
SHIPMENT,    F.  O.  B.    OVENS.s 


January  

$3.85 

$1.88 

$1.55 

$3.  14 

$9.44 

$6.00 

February 

2.60 

1.90 

.55 

3.41 

10.57 

6.00 

March 

2.47 

1.92 

.53 

3.45 

9.58 

6  00 

April     .                

2.20 

.90 

.55 

2.45 

8.00 

6.00 

May 

2.15 

.83 

.50 

2.34 

8.40 

6.00 

June 

2.20 

.80 

.50 

2.54 

11  20 

6  00 

July                                

2.50 

.75 

.67 

2.65 

12.32 

6.00 

August 

2.50 

.74 

.54 

2.75 

13.42 

6.00 

September     

2.37 

.70 

1.66 

2.94 

11.85 

6.00 

October 

2.10 

.65 

2.18 

5.69 

26.00 

6.00 

November  

1.88 

.60 

2.35 

6.91 

6.00 

6.00 

December  ..        

1.77 

.60 

2.85 

9.00 

6.00 

6.00 

MARKET  PRICES,  AT  WHOLESALE,  OF  BASIC  PIG  IRON,  F.  O.  B.  MAHONING  OR  SHE- 
NANGO  VALLEY  FURNACE^ 


January  

$16.41 

$12.50 

$12.50 

$17.  81 

$30.00 

$33.00 

February        

16.30 

13.19 

12.50 

17.69 

30.00 

33.00 

March 

16  11 

13  00 

12  50 

18.20 

32  25 

33  00 

April  

15.87 

13.00 

12.50 

18.13 

38.75 

33.00 

Mav 

15  15 

13  00 

12  50 

18.00 

41.60 

33  00 

June     

14.50 

13.00 

12.59 

18.00 

48.75 

33.00 

July         

14.37 

13.00 

12.74 

18.00 

52.50 

33  00 

August 

14  06 

13  00 

14  06 

18.00 

51.20 

33  00 

September        

14.00 

13.00 

14.75 

18.31 

42.75 

33.00 

October    

13  90 

12  81 

15  00 

19.88 

2  33.  00 

33.00 

November 

13  09 

12  48 

15  75 

25  10 

33.00 

33  00 

December  

12.71 

12.50 

17.50 

30.00 

33.00 

33.00 

1  Quotations  represent  prices  per  ton  and  were  taken  on  first  of  each  month  from  the  Iron  Trade  Review. 

2  Fixed  price. 

s  Metal  Statistics,  published  by  the  American  Metal  Market  and  Daily  Iron  and  Steel  Report,  for  1919, 
p.  37.    Prices  are  quoted  per  net  ton. 
*  Prices  are  per  gross  ton  and  were  taken  from  the  Iron  Age,  Jan.  2, 1919,  p.  18. 


264  HISTORY  OF   PRICES   DURING  THE  WAR. 

MARKET  PRICES,  AT  WHOLESALE,  OF  STEEL  BARS,  PITTSBURGH.! 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January 

$1  40 

$1  20 

$1  10 

$1  87 

S3  00 

«o  qo 

February  . 

1  40 

1  22 

1  10 

2  06 

3  00 

2  90 

March 

1  40 

1  20 

1  15 

2  36 

3  27 

2  90 

April... 

1.40 

.15 

1.20 

2  50 

3  39 

2  90 

May 

1  40 

14 

1  20 

2  50 

3  64 

2  go 

June 

1  40 

12 

1  20 

2  50 

4  00 

0    Of) 

Julv         

1  40 

12 

1  27 

2  50 

4  50 

2  90 

August 

1  40 

18 

1  30 

2  56 

4  50 

2  90 

September     

1.40 

.19 

1  35 

2  60 

3  88 

2  90 

October    . 

1  39 

15 

1  43 

2  62 

2  2  90 

2  90 

November  

1.30 

1.11 

1.63 

2  76 

2  90 

2  90 

December  

1  22 

1  05 

1  75 

2  93 

2  90 

2  78 

MARKET  PRICES,  AT  WHOLESALE,  OF  STRUCTURAL    SHAPES    (BEAMS    AND  CHAN- 
NELS) 3-INCH  TO  15-INCH,  PITTSBURGH.i 


January...  .          .... 

$1.50 
1.45 
1.45 
1.45 
1.45 
1.45 
1.45 
1.45 
1.40 
1.39 
1.34 
1.24 

$1.20 
1.25 
1.21 
1.18 
1.15 
1.12 
1.12 
1.18 
1.20 
1.16 
1.11 
1.05 

$1.10 
1.10 
1.15 
1.20 
1.20 
1.20 
1.25 
1.30 
1.33 
1.44 
1.63 
1.75 

$1.87 
2.06, 
2.36 
2.50 
2.50 
2.50 
2.50 
2.54 
2.60 
2.63 
2.86 
3.03 

$3.11 
3.25 
3.52 
3.70 
4.00 
4.25 
4.50 
4.50 
4.06 
23.00 
3.00 
3.00 

$3.00 
3.00 
3.00 
3.00 
3.00 
3.00 
3.00 
3.00 
3.00 
3.00 
3.00 
2.88 

February 

March... 

April  .. 

May 

June 

July  

August  .  . 

September 

October  

November 

December  

MARKET  PRICES,  AT  WHOLESALE,  OF  STEEL  PLATES,  TANK,  PITTSBURGH.i 

JaTHiar~r 

$1.50 
1.45 
1.45 
1.45 
1.45 
1.45 
1.45 
1.44 
1.40 
1.36 
1.29 
1.20 

$1.20 
1.21 
1.18 
1.15 
1.14 
1.10 
.11 
.18 
.19 
.14 
.09 
1.05 

$1.10 
1.10 
1.15 
1.20 
1.17 
1.15 
1.22 
1.26 
1.33 
1.42 
1.63 
1.75 

$1.90 
2.16 
2.53 
2.75 
2.83 
2.90 
2.90 
2.94 
3.00 
3.07 
3.33 
3.53 

$3.61 
3.75 
4.33 
4.50 
4.50 
7.10 
9.00 
8.96 
7.05 
23.25 
3.25 
3.25 

$3.25 
3.25 
3.25 
3.25 
3.25 
3.25 
3.25 
3.25 
3.25 
3.25 
3.25 
3.10 

February... 

March 

April... 

May..  .. 

June  

July 

August  

September 

October  

November  

Dew.mbeir 

1  Quotations  represent  prices  per  hundredweight  and  were  taken  from  Metal  Statistics  for  1919. 

2  Fixed  price. 

Semifinished-product  prices  fixed  October  11,  1917. — The  next  of 
the  three  great  initial  steps  in  the  fixing  of  iron  and  steel  prices, 
following  the  fixing  of  raw-material  prices  on  September  24,  came 
scarcely  three  weeks  later  when  prices  were  fixed  on  the  inter- 
mediate products  (blooms,  billets,  slabs,  sheet  bars,  wire  rods,  shell 
bars,  and  skelp)  on  October  11,  1917. 

There  need  be  no  restatement  of  the  method  by  which  the  Govern- 
ment and  industry  arrived  at  the  prices  fixed  on  these  semifinished 
products,  since  the  approach  was  not  unlike  that  made  to  the  former 
price  fixing  of  raw  materials.  It  should  be  said,  however,  that 
meantime  the  old  iron  and  steel  committees,  formerly  represent- 
ing the  industry  in  the  Council  of  National  Defense,  went  out  of 


GOVERNMENT   CONTROL   OVER  PRICES. 


265 


existence  and  the  American  Iron  and  Steel  Institute  became  the 
formal  and  authoritative  spokesman  of  the  industry  to  the  Gov- 
ernment. The  steel  manufacturers,  thus  formed  into  committees 
under  the  American  Iron  and  Steel  Institute  for  the  purpose  of  fur- 
nishing information  to  the  War  Industries  Board,  had  no  con- 
nection, advisory  or  otherwise,  with  the  awarding  of  any  con- 
tracts.1 These  newly  formed  institute  committees  and  the  Gov- 
ernment, immediately  after  the  fixing  of  prices  on  iron  ore,  coke, 
pig  iron,  plates,  shapes,  and  bars  in  September,  began  conferring 
among  themselves  and  with  each  other  to  determine  prices  on  semi- 
finished products  in  line  with  those  just  announced  on  raw  materials. 
They  came  finally  to  an  agreement,  and  the  War  Industries  Board 
submitted  the  newly  determined  prices  to  the  President. 

The  President  approved  the  prices  fixed  on  these  more  highly  man- 
ufactured steel  products  on  October  11,  and  announced  the  following 
as  maximum  prices  effective  immediately  but  subject  to  revision  Janu- 
ary 1,  1918: 


Commodity. 

Basis. 

Price. 

Blooms  and  billets,  4  by  4  inches  and 
,    larger.                             > 
Bi'lets  under  A  by  4  inches  J 

Pittsburgh-  Youngst  own.    . 

$47.50  per  gross  ton.     \ 

V$51  per  gross  ton} 
$50  per  gross  ton.       ^ 
$51  per  gross  ton.  1  \M     -.. 
$57  per  gross  ton.Q  L  -  j.j 

$3.25  per  100  pounds. 
$3.50  per  100  pounds. 
$3.75  per  100  t»ounds. 
$4  per  100  pounds.           -^ 
l«  » 
$2.90  per  100  pounds.  * 
$3.]  5  per  100  pounds/, 
$3.25  t>er  100  poundsV 

do 

Plabs 

do  .  . 

Sheet  bars 

do 

Wi^e  rods  .  .             .   . 

Pittsburgh          ... 

Shell  bars: 
3  to  5  inches 

do 

Over  5  to  8  inches. 

do     . 

Over  8  to  10  inches 

do 

Over  10  inches  

do  

Skeip: 
Grooved 

do 

Universal  

do  

Sheared 

do 

The  President  announced  that  he  fixed  these  maximum  prices  on 
the  assurance  of  the  steel  industry  that  they  would  equitably  adjust 
the  relations  of  the  steel  interests  to  each  other,  and  assist  to  give 
the  country  a  maximum  of  production. 

Bessemer  steel  billets,  at  Pittsburgh,  which  were  selling  at  $19 
per  gross  ton  at  the  close  of  1914,  sold  as  high  as  $100  in  July,  1917, 
and  were  fixed  at  $47.50  in  October.2  Bessemer  sheet  bars,  at  Pitts- 
burgh, which  were  selling  at  $20  when  war  began,  rose  to  $105  in 
June  and  July  of  1917,  and  were  fixed  at  $51  per  gross  ton  in  Octo- 
ber.3 Bessemer  wire  rods,  at  Pittsburgh,  which  were  selling  at  $24.50 
three  years  earlier,  attained  a  peak  of  $96.25  in  July,  1917,  and 
were  fixed  at  $57  per  gross  ton  in  October.4  Grooved  steel  skelp,  at 

1  Iron    Age,    Oct.    4,    1917,    p.    832. 

2  Iron  Age,  Jan.  2,   1919,  p.   18. 

8  Metal  Statistics  for  1919,  p.  91. 
*  Iron  Age,  Jan.  2,  1919,  p.  20. 


266  HISTORY  OF  PRICES   DURING  THE  WAR. 

Pittsburgh,  which  was  selling  at  $1.15  in  July,  1914,  rose  to  $6  in 
July,  1917,  and  was  fixed  at  $2.90  per  hundred  pounds  in  October,1 

Finished-product  prices  fixed  November  5,  1917. — The  last  of  the 
initial  three  steps  in  price  fixing  within  the  iron  and  steel  group 
came  on  November  5,  1917,  when  the  President  approved  an  agree- 
ment between  the  War  Industries  Board  and  the  steel  industry,  fix- 
ing prices  on  certain  finished  products  (sheets,  pipe,  cold-rolled  steel, 
scrap,  wire,  and  tin  plate).  The  President  fixed  these  maximum 
prices  at  that  time,  subject  to  revision  January  1,  1918.  It  is  of  par- 
ticular interest  that  he  also  announced  that  the  iron  and  steel  manu- 
facturers had  agreed  "  promptly  to  adjust  the  maximum  prices  of  all 
iron  and  steel  products  other  than  those  on  which  prices  have  been 
agreed  upon  to  the  same  general  standard  as  those  which  have  been 
announced.  It  is  expected  that  this  will  be  done  promptly  and  con- 
sistently in  line  with  the  basic,  intermediate,  and  finished  products, 
for  which  definite  maximum  prices  have  been  established."2  The 
Government  had  thus  brought  under  its  control  the  basic  raw  ma- 
terials, semifinished  products,  and  finished  products  of  the  iron  and 
steel  industry. 

The  basic  finished-product  prices  which  were  announced  November 
5  were  as  follows: 

Shppt<*  •  Per  10° 

pounds. 

No.  28  black  sheets  f.  o.  b.  Pittsburgh___ $5.  00  o '* 

No.  10  blue  annealed  sheets  f.  o.  b  Pittsburgh 4.  25  ^ 

No.  28  galvanized  sheets  f.  o.  b.  Pittsburgh 6.  25  fr 

The  above  prices  to  apply  to  both  Bessemer  and  open-hearth  grades. 

Pipe :  On  f -inch  to  3-inch  black  steel  pipe,  discount  52  and  5  and  2£  per  cent 
f.  o.  b.  Pittsburgh. 

Cold-rolled  steel :  Seventeen  per  cent  discount  from  March  15,  1915,  list  f.  o.  b. 
Pittsburgh. 

Per  gross 
Scrap  (f.  o.  b.  consuming  point)  :  ton.  * 

No.  1  heavy  melting $30.00  V 

Cast-iron  borings  and  machine-shop  turnings (20.00? 

No.  1  railroad  wrought 35.  00  1  "* 

Wire,  plain  wire  f.  o.  b.  Pittsburgh,  per  100  pounds 3.  25  V  * 

Tin  plate,  coke  base,  Bessemer,  and  open  hearth  f.  o.  b.  Pittsburgh,  per 

100-pound  box 1 .7.75    12* 

Black  sheets,  No.  28  gauge,  f.  o.  b.  mill  at  Pittsburgh,  which  were 
selling  for  $1.80  when  war  began,  sold  for  $8  during  July,  August, 
and  September,  of  1917,  and  were  fixed  at  $5  per  hundred  pounds  in 
November.3  Galvanized  sheets,  No.  28  gauge,  f.  o.  b.  mill  at  Pitts- 
burgh, which  were  selling  at  $2.75  when  war  came  in  Europe,  rose  to 
$10.50  in  July,  1917,  and  were  selling  at  $8.90  still  in  October.  They 

1  Metal  Statistics  for  1919,  p.  115. 

2  Official  Bulletin,  Nov.  6,  1917. 

8  Metal  Statistics  for  1919,  p.  131. 


GOVERNMENT   CONTROL   OVER   PRICES.  267 

were  fixed  at  $6.25  per  hundred  pounds  in  November.1  Blue  an- 
nealed sheets,  No.  10  gauge,  at  Pittsburgh,  which  were  selling  at 
$1.35  at  the  beginning  of  war,  rose  to  $8.25  in  July,  1917,  and  were 
fixed  at  $4.25  per  hundred  pounds  in  November.2  Heavy  melting 
steel  scrap,  at  Pittsburgh,  rose  from  $11.75  when  war  broke  out  to 
$38.75  in  July,  1917,  and  was  fixed  at  $30  per  gross  ton  in  November.3 
The  average  price  of  plain  wire,  at  Pittsburgh,  for  1914  was  $1.40, 
for  1917  $3.95,  and  the  price  fixed  in  November,  1917,  was  $3.25  per 
hundred  pounds.4  Tin  plates,  at  Pittsburgh,  were  selling  at  $3.20 
the  last  of  1914,  and  rose  as  high  as  $7.50  in  March,  1917.  They 
were  fixed  at  $7.75  per  hundred-pound  box  in  November,  1917 — the 
highest  price  quoted  in  18  years,  if  ever.5 

The  determination  of  differentials  upon  basic  prices. — It  must  be 
borne  in  mind  for  emphasis  that  the  President,  upon  the  joint 
recommendation  of  the  War  Industries  Board  and  the  iron  and  steel 
industry,  approved  simply  the  basic  raw  material  prices  (iron  ore, 
coke,  pig  iron,  steel  bars,  shapes,  and  plates)  on  September  24;  cer- 
tain basic  semifinished-product  prices  (blooms,  billets,  slabs,  sheet 
bars,  wire  rods,  shell  bars,  and  skelp)  on  October  11;  and  certain 
finished  products  (sheets,  pipe,  cold  rolled  steel,  scrap,  wire,  and  tin- 
plate)  on  November  5,  1917.  These  prices  were  meant  simply  to 
afford  a  basis  for  other  related  controls,  and  the  President  went  so 
far,  in  his  statement  of  the  latter  date,  as  to  instruct  the  industry  to 
bring  the  prices  of  all  iron  and  steel  products  into  a  line  with  the 
above  announced  basic  prices.  The  Government,  therefore,  left  quite 
to  the  industry  the  burden  of  determining  the  thousands  of  differen- 
tials figured  upon  the  Government  fixed  basic  prices.6 


1  Ibid. 

2  Ibid. 

3  Ibid. 
*  Ibid. 

5  Ibid. 


p.  133. 

p.  127. 

p.  159. 

p.  103. 


p.    141. 

6  The  full  list  of  differentials  figured  under  the  various  basic  prices  announced  by  the 
Government,  and  as  published  by  the  American  Iron  and  Steel  Institute  of  61  Broadway, 
New  York,  consumes  150  pages  of  detailed  schedules  of  "  Maximum  Prices  on  Iron  and 
Steel  Products"  (issued  Nov.  15,  1918),  and  shows  control  over  alloy  steel  castings; 
anchors ;  angles,  heavy ;  angles,  light ;  angle  splice  bars ;  automobile  sheets ;  bands ; 
bands,  heavy,  iron ;  bands,  light,  iron ;  barbed  wire ;  bars,  angle  splice ;  bars,  concrete 
reinforcing ;  bars,  forging ;  bars,  iron ;  bars,  rail  steel ;  bars,  sheet ;  bars,  shell  ;  bars, 
steel ;  basic  pig  iron ;  beams,  Bessemer  ferrosillicon ;  Bessemer  pig  iron  ;  beveled  edge 
box  iron  ;  billets  for  seamless  tubes ;  billets,  forging ;  billets,  re-rolling ;  billets,  small ; 
black  plate,  tin  mill ;  black  sheets ;  blast,  furnace  castings  ;  blooms,  re- rolling ;  blooms, 
forging;  blue  annealed  sheets,  boat  spikes;  boiler  castings;  boiler  tubes;  bolsters,  bolts; 
bolts,  railroad  track ;  brads ;  bridge  blocks ;  bulb  angles ;  bulb  beams ;  calks ;  car 
and  locomotive  frames ;  carbon  tool  steel ;  car  castings ;  car  wheels ;  castings,  malle- 
able ;  castings,  steel ;  cast-iron  water  pipe ;  cement  mill  castings ;  chain  ;  channels,  heavy  ; 
channels,  light ;  charcoal  pig  iron ;  cold  rolled  and  cold  drawn  steel ;  cold  rolled  strip 
steel ;  column  bases  ;  concrete  reinforcing  bars  ;  couplers  ;  crane  castings  ;  cut  nails  ;  cut 
tacks ;  electrical  sheets ;  engine  castings ;  ferrosillicon,  Bessemer ;  flats ;  flats,  cold 
rolled  and  cold  drawn  ;  flats,  iron  ;  forging  bars  ;  forging  ingots ;  forging  steel ;  formed 
roofing  sheets  ;  foundry  pig  iron  ;  galvanized  sheets ;  gears  ;  half  ovals  ;  half  ovals,  iron  ; 
half  rounds ;  half  rounds,  iron  ;  hexagons ;  hexagons,  cold  rolled  and  cold  drawn  ;  high 


268  HISTORY   OF   PRICES   DURING   THE   WAR. 

In  response  to  the  request  of  the  President  on  November  5,  the  com- 
mittee on  steel  and  steel  products  of  the  American  Iron  and  Steel 
Institute,  which  is  a  private  organization,  studied  the  basic,  inter- 
mediate, and  finished  product  prices,  for  which  definite  maximum 
prices  had  been  established  by  the  Government  and  recommended 
what  it  considered  "  fair  and  reasonable  "  differentials.  It  appears 
that  the  promulgation  of  these  differentials  and  their  enforcement 
was  left  in  large  part  to  the  American  Iron  and  Steel  Institute  itself. 
The  committee  of  the  institute  recommended  these  differentials  to  the 
industry  direct,  under  dates  of  November  13,  November  20,  and  De- 
cember 22,  1917,  and  January  7,  1918,  asking  that  such  prices  be 
adopted  as  maximum  prices  to  take  effect  immediately;  to  apply  to 
the  requirements  of  the  Government,  the  Allies  and  of  domestic  con- 
sumers. The  committee  added  in  its  recommendations  to  the  in- 
dustry of  the  latter  date : 1 

That  the  prices  of  all  iron  and  steel  products,  maximum  prices  for  which 
have  not  been  agreed  to  with  the  War  Industries  Board  or  recommended  by 
the  committee,  be  promptly  adjusted  so  as  to  be  in  line  with  the  basic,  inter- 
mediate, and  finished  products  for  which  definite  maximum  prices  have  been 
established.  The  committee  relies  upon  the  patriotism  and  good  faith  of  the 
iron  and  steel  industry  to  accomplish  this,  and  expresses  the  hope  that  all 
connected  with  the  iron  and  steel  industry  will  cooperate  in  the  proper  spirit 
to  this  end. 

All  prices,  differentials,  and  extras  recommended  by  the  American 
Iron  and  Steel  Institute,  through  its  committee  on  steel  and  steel 

sillicon  or  silvery  iron  ;  high-speed  tool  steel ;  hoops  ;  horse  and  mule  shoes ;  horseshoe 
iron  ;  hot  rolled  strip  steel ;  ingots,  forging ;  iron  bars  ;  iron  ore ;  iron  rolls ;  jaw  and 
gyratory  crusher  castings  ;  light  rails  ;  locomotive  castings  ;  long  terne  sheets  ;  low  phos- 
phorus pig  iron  ;  malleable  castings  ;  mine  and  industrial  car  castings  ;  mule  shoes  ;  nails, 
cut ;  nails,  wire  ;  nuts  ;  ore,  iron  ;  ovals  ;  ovals,  iron  ;  pig  iron  ;  pinions  ;  pinions,  iron  ; 
pinionsi,  steel ;  pipe,  cast-iron  water ;  pipe,  steel ;  plates ;  propeller  wheels  ;  rail  or  step 
joint  castings ;  rails,  light ;  rails,  re-rolling ;  railroad,  track  bolts ;  railroad  track  spikes ; 
rail  steel  bars ;  refractory  and  brickyard  castings  ;  re-rolling  rails ;  rivet  rods ;  rivets  ; 
road  and  mining  machinery  castings;  rods,  rivet;  rods,  wire;  rolling  mill  castings;  rolls, 
iron  ;  rolls,  steel ;  rope,  wire ;  rounds  ;  rounds,  cold  rolled  and  cold  drawn  ;  rounds,  iron  ; 
scrap,  iron  and  steel ;  screws,  wood ;  seamless  steel  tubes ;  seamless  tubes,  billets  for ; 
shapes,  small ;  shapes,  structural ;  sheets  ;  sheets,  automobile ;  sheet  bars ;  sheets,  black  ; 
sheets,  blue  annealed ;  sheets,  electrical ;  sheets,  formed,  roofing ;  sheets,  galvanized ; 
sheets,  long  terne ;  sheets,  painted  and  formed  ;  shell  bars  ;  shoes,  horse  and  mule  ;  shoes, 
steel ;  shoe  finders'  goods  ;  silvery  pig  iron  ;  skelp ;  skelp  for  boiler  tubes  ;  slabs,  forging ; 
slabs,  re-rolling ;  small  billets ;  small  shapes ;  spikes,  boat ;  spikes,  railroad  track ;  splice 
joints  for  light  rails ;  spring  steel ;  spring  steel  card  ;  squares ;  squares,  cold  rolled  and 
cold  drawn  ;  squares,  iron  ;  steel  bands,  hoops,  and  strips  ;  steel  bars ;  steel,  carbon  tool ; 
steel  castings  ;  steel,  cold  rolled  and  cold  drawn  ;  steel  forging ;  steel,  high  speed  tool ; 
steel,  hot  rolled  strip  ;  steel,  pipe  ;  steel,  spring ;  steel  tire  card  ;  steel,  tool ;  steel  works 
castings ;  strip  steel,  cold  rolled ;  strip  steel,  hot  rolled ;  strip,  hot  rolled ;  structural 
shapes ;  tacks,  cut ;  tees,  heavy  ;  tees,  light ;  terneplate ;  tie  plates,  iron  ;  tie  plates,  steel ; 
tinmill  black  plate  ;  tinplate ;  tires  ;  tool  steel ;  track  bolts ;  tubes,  boiler  ;  tubes,  seamless 
steel ;  wire ;  wire,  barbed ;  wire  nails ;  wire  rods  ;  wire  rope ;  wood  screws  ;  zees,  heavy. 

1  Maximum  Prices  on  Iron  and  Steel  Products,  issued  Nov.  15,  1918,  by  the  American 
Iron  and  Steel  Institute,  pp.  10,  11. 


GOVERNMENT   CONTROL   OVER  PRICES.  269 

products,  were  given  the  same  application  in  all  policies  as  those 
fixed  specifically  by  the  War  Industries  Board  or  later  by  the  price- 
fixing  committee. 

Modifications  of  original  basic  prices  fixed. — It  is  noteworthy  that 
the  great  bulk  of  basic  price  fixing  of  iron  and  steel  during  the  war 
was  done  by  the  War  Industries  Board,  before  the  price-fixing  com- 
mittee got  started  in  March,  1918.  Of  no  less  significance  is  it  that, 
though  the  subsequent  changes  were  enormous  in  number,  there  were 
relatively  few  important  changes  ever  made  in  the  raw  material 
prices  fixed  September  24,  the  intermediate  prices  fixed  October  11, 
the  finished  product  prices  announced  November  5,  1917,  and  the 
differentials  based  thereon  announced  soon  afterwards  by  the  Amer- 
ican Iron  and  Steel  Institute.  Those  original  prices  generally  were 
renewed  every  three  months  after  considerable  discussion  between 
the  Government  and  the  industry.  There  were  some  modifications, 
however,  which  ought  to  be  noted. 

The  price  fixing  committee,  through  the  President,  announced  on 
March  26,  1918,  that  the  price  of  basic  pig  iron  would  be  reduced 
from  $33  to  $32  per  gross  ton  during  April,  May,  and  June,  and  the 
maximum  price  of  scrap  steel  reduced  from  $30  to  $29  per  gross  ton. 
The  well-known  meeting  of  March  20  between  the  price  fixing  com- 
mittee and  the  industry  had  turned,  in  the  main,  upon  a  considera- 
tion of  the  price  tendency  of  the  schedule  due  for  revision  and  the 
period  during  which  it  should  be  in  force.  The  proposed  plan  to 
pool  the  output  of  producers  so  that  large  and  small  manufacturers 
alike  might  secure  a  reasonable  profit,  while  production  was  kept 
at  a  maximum,  did  not  find  favor.1  The  price  fixing  committee 
ignored  cost  sheets  showing  rapidly  rising  figures,  on  the  ground 
that  they  were  based  upon  abnormal  conditions  during  January  and 
February.  The  committee  also  refused  to  extend  the  new  prices, 
as  was  desired  by  the  steel  men,  to  a  period  of  six  months  rather 
than  three.2  It  asked  that  no  new  contracts,  calling  for  delivery 
on  or  after  July  1,  specify  any  price  unless  coupled  with  a  clause 
making  the  price  subject  to  revision  by  any  Government  agency. 
The  price  fixing  committee,  again  on  September  24,  1918,  just  one 
year  after  the  War  Industries  Board  had  originally  fixed  that  price, 
set  the  base  price  of  basic  pig  iron  again  at  $33  f .  o.  b.  furnace.  The 
base  price  on  No.  2  foundry  iron  was  increased  to  $34,  and  that  of 
standard  Bessemer  iron  at  $35.20  f.  o.  b.  furnace.  These  increased 
prices  were  subject  to  certain  changes  from  previous  practices  as 
regards  delivery.3 

1  Iron  Age,  Mar.  14,  1018,  pp.  700,  701,  and  Mar.  28,  1018,  p.  800. 

2  Quarterly  Journal  of  Economics,  August,  1918,  by  A.  Berglund,  pp.  615,  616. 

3  Maximum  Prices  on  Iron  and  Steel  Products,  pp.  12  and  17. 


270 


HISTORY   OF   PRICES   DURING   THE   WAR. 


The  price  fixing  committee,  on  June  21,  1918,  increased  the  base 
prices  of  Lake  Superior  iron  ore,  delivered  to  lower  lake  ports, 
45  cents  per  gross  ton  after  July  1.  These  increased  prices  were 
based  upon  the  advances  in  rail  freight  rates  effective  as  of  June  25, 
and  the  then  prevailing  lake  rates.1  The  committee  again  announced 
on  September  24  that  the  base  price  of  Lake  Superior  iron  ore  would 
be  increased  25  cents  per  gross  ton  after  October  1,  provided  that  if 
either  rail  or  lake  rates  are  increased  or  decreased  that  the  base 
prices  would  be  changed  accordingly.2 

Price  control  and  the  relative  rise  of  prices  and  production. — A 
summary  of  the  relative  prices  prevailing  at  certain  significant  dates 
is  presented  in  the  following  table.  The  advance  in  prices  caused 
by  the  entry  of  the  United  States  into  the  war  is  shown  by  the  rise 
from  April,  1917,  to  July,  1917.  In  July  the  first  announcements  of 
a  Government  price-fixing  policy  were  made,  and  the  October  prices 
show  the  reductions  accomplished  through  price  control.  The  aver- 
age of  market  prices  from  July  1,  1913,  to  June  30,  1914,  is  taken  as 
100.% 


July, 
1915. 

April, 
1917. 

July, 
1917. 

Octobe  , 
1918. 

Iron  nrfi    Affisftbi   noti-T^fiSSemer 

85 

153 

153 

174 

Coke,  Connellsville,  furnace  

85 

352 

594 

291 

Pig  iron,  basic 

96 

291 

394 

240 

Steel  billets,  open  hearth  . 

103 

344 

436 

218 

Structural  shapes 

98 

260 

424 

205 

Steel  plates,  tank  ....                                             

97 

357 

714 

258 

Tin  plate,  domestic,  coke 

92 

233 

349 

225 

Wire  rods,  Bessemer  .      

102 

337 

382 

226 

There  can  not  readily  be  had  an  accurate  statistical  comparison  of 
the  relative  rises  of  the  prices  and  corresponding  production  of  all 
groups  controlled  within  the  iron  and  steel  industry.  The  most  sat- 
isfactory of  all  the  comparisons  is  that  which  can  be  made  of  the 
relative  rises  of  the  prices  of  basic  pig  iron  and  those  of  the  produc- 
tion of  pig  iron  by  months  from  1913  to  1918.  In  the  calculation 
both  of  the  relative  prices  and  the  relative  production  figures,  the 
average  price  or  production  figure,  respectively,  for  the  prewar  year 
(July  1,  1913  to  June  30,  1914)  was  taken  as  a  base  equal  to  100. 
This  comparison  is  the  more  interesting  because  pig  iron,  the  basic 
raw  material  of  the  industry,  was  fixed  as  early  as  September  24, 
1917,  and  during  the  war  underwent  even  less  violent  rises  than 
many  other  commodities  of  the  iron  and  steel  group.  The  base  price 
for  the  prewar  period,  adopted  as  100  in  figuring  the  relative  prices 

1  Maximum  Prices  of  Iron  and  Steel  Products,  p.  14. 

2  Ibid,  p.   17. 

3  See  "  Prices  of  Iron,  Steel,  and  their  Products/'  by  Walter  W.  Stewart   (War  Indus- 
tries Board  Price  Bulletin  No.  33). 


GOVERNMENT   CONTROL   OVER   PRICES. 


271 


of  pig  iron  in  the  table  following,  was  $13.31,  and  the  base  produc- 
tion figure  for  that  same  prewar  period,  also  adopted  as  100  in  the 
table  below,  was  2,231,420  gross  tons. 


RELATIVE  PRICES  OF  PIG  IRON,  BASIC, 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

January 

123 

94 

94 

134 

225 

218 

February 

122 

99 

94 

133 

225 

248 

March.  

121 

98 

94 

137 

242 

248 

April 

119 

98 

94 

136 

291 

240 

May 

114 

98 

94 

135 

312 

240 

June  

109 

98 

95 

135 

366 

210 

July 

108 

98 

96 

135 

394 

240 

August 

106 

98 

106 

135 

384 

240 

September  

105 

98 

111 

137 

321 

240 

October 

104 

96 

113 

149 

248 

218 

November 

98 

94 

118 

188 

248 

248 

December  

95 

94 

131 

225 

248 

248 

RELATIVE  PRODUCTION  OF  PIG  IRON. 


January 

125 

84 

72 

143 

141 

108 

February 

116 

85 

75 

138 

119 

104 

March... 

124 

105 

92 

150 

146 

144 

April.. 

123 

102 

95 

145 

149 

147 

May 

126 

94 

101 

151 

153 

154 

June.  .. 

118 

86 

107 

144 

147 

149 

July 

115 

88 

115 

145 

150 

153 

August  

114 

89 

125 

144 

146 

152 

September  .  . 

112 

84 

128 

144 

140 

153 

October 

114 

80 

140 

157 

148 

156 

November  

100 

68 

136 

148 

144 

150 

December. 

89 

68 

144 

142 

129 

154 

Summary. — The  Government  undertook  few  price  controls  dur- 
ing the  whole  war  more  extensive  than  that  which  it  exercised  over 
the  iron  and  steel  industry.  The  President,  after  various  informal 
agreements  made  in  conference  between  the  War  Industries  Board 
and  the  steel  men,  approved  their  recommendation  to  fix  the  prices 
of  the  basic  raw  materials  (iron  ore,  coke,  pig  iron,  steel  bars, 
shapes,  and  plates)  on  September  24,  1917;  their  recommendation 
to  fix  the  prices  of  intermediate  products  (blooms,  billets,  slabs, 
sheet  bars,  wire  rods,  shell  bars,  and  skelp)  on  October  11,  1917; 
and  those  for  certain  finished  products  (sheets,  pipe,  cold  rolled 
steel,  scrap,  wire,  and  tin  plate)  on  November  5,  1917.  He,  on  the 
latter  date,  asked  the  industry  itself  to  adjust  the  maximum  prices 
of  all  iron  and  steel  products  in  line  with  the  basic,  intermediate, 
and  finished  product  prices  already  fixed.  The  industry,  through 
the  American  Iron  and  Steel  Institute,  adjusted  thousands  of  prices, 
differentials,  and  extras  to  those  bases.  The  most  important  part  of 
this  price  fixing  was  done  under  the  War  Industries  Board,  before 
the  creation  of  the  price  fixing  committee. 

The  index  number  for  the  whole  iron  and  steel  group  in  July, 
1917,  when  it  became  known  that  the  Government  probably  would 
fix  prices,  had  reached  a  peak  unknown  in  iron  and  steel  history. 


272  HISTORY   OF   PRICES   DURING   THE   WAR. 

The  weighted  "all  commodities"  index  number  in  the  same  month 
stood  89  per  cent  above  its  prewar  level,  while  the  iron  and  steel 
index  number  showed  an  advance  of  270  per  cent.  The  fall  immedi- 
ately following  July,  and  before  formal  control  began  in  September, 
was  due  in  large  part  to  an  anticipation  of  control  and  must  to  that 
extent  be  credited  to  the  influences  of  Government  regulation.  By 
October,  after  prices  had  been  fixed,  the  index  number  for  iron  and 
steel  prices  had  made  a  straight  drop  back  to  a  level  143  per  cent 
above  the  prewar  price.  In  November  the  index  number  for  the 
group  receded  still  further  to  118  per  cent  above  the  prewar  level 
where  it  remained  without  an  important  rise  or  drop  until  the  armis- 
tice was  signed. 

COPPER. 

The  first  of  the  metal  price  controls  and,  as  proved  later,  one  of 
the  most  important,  was  that  over  electrolytic  copper  begun  formally 
on  September  21.  1917.  By  comparison  with  the  iron  and  steel  con- 
trol which  followed  upon  its  heels,  it  was  a  simple  regulation.  The 
Government  came  ultimately  to  fix  the  raw  material,  intermediate 
and  finished  product  prices  within  the  iron  and  steel  group,  involv- 
ing thousands  of  differentials  and  extras  calculated  upon  basic 
prices.  But  throughout  the  whole  war,  speaking  generally,  it  did 
not  attempt  fixation  in  the  copper  group  of  more  than  electrolytic 
copper  (refined  by  the  electrolytic  process  and  running  99.93  per 
cent  pure  or  upward) — the  great  basic  raw  material  of  the  industry. 
The  Government  was  provoked  to  a  control  over  copper  more  by  a 
concern  for  maximum  production  than  from  fear  of  a  runaway 
market.  While  formal  price  fixing  did  not  begin  until  later,  during 
the  six  months  after  our  entry  into  the  war,  the  negotiations  of  the 
War  Industries  Board  for  Government  and  allied  purchases  bear 
upon  the  price-fixing  problem.  It  is  necessary  to  review  these  actions 
before  pushing  an  inquiry  into  the  fixing  of  the  first  price  in  Sep- 
tember, 1917,  and  the  increase  of  price  allowed  in  July,  1918. 

Copper  production  of  more  concern  than  high  prices. — This  coun- 
try controls  the  bulk  of  copper  in  the  world  and,  by  the  enormous 
allied  purchases  during  1916  and  1917,  was  made  to  realize  that, 
if  it,  too,  was  to  make  war,  it  must  maintain  maximum  copper  pro- 
duction. Even  before  the  United  States  entered  the  struggle,  the 
European  War  required  the  lion  share  of  copper  mined  in  the  coun- 
try. After  our  entry  it  was  obvious  that  a  normal  output  of  copper 
would  not  suffice.  There  would  be  required  very  much  more,  though 
nobody  knew  specifically  the  quantity.  Curiously,  copper  prices, 
during  the  phenomenal  steel  rise  of  1917,  were  falling.  Yet  the 
Government,  though  interested  primarily  in  encouraging  maximum 
copper  production,  presently  concerned  itself  with  price  control  be- 
cause it  believed  that  a  means  to  the  greater  end  in  mind. 


GOVERNMENT    CONTROL    OVER   PRICES. 


273 


To  make  the  situation  clear,  there  are  presented  statistics  showing 
the  war-time  changes  in  the  prices  of  electrolytic  copper  at  Xew 
York ;  the  production  of  refined  new  copper ;  the  stocks  on  hand ;  the 
amount  of  copper  exported:  and  the  apparent  domestic  consumption 
of  copper.1 

ACTUAL  COPPER  MOVEMENTS. 


Year. 

Prices 
(electro- 
lytic 
copper). 

Production 
(total  new 
supply). 

Stocks 
(beginning  of 
year). 

Exports. 

Domestic 
consumption 
(apparent). 

1913 

Cents. 
15.52 

Pounds. 
1,615,067,782 

Pounds. 
105,  497,  683 

Pounds. 
817,911,424 

Pounds. 
812,268  639 

1914  

13.32 

1,533,781,394 

90,386,402 

840,080,922 

620,445,373 

1915 

17.47 

1,634,204,448 

173,640,501 

681,917,955 

1,043,497,328 

1916 

28.46 

2.259,387,315 

82,429,666 

784,006,486 

1,429,755,266 

1917  

29.19 

2,423,646,171 

128,000,000 

1,126.082,417 

1,316,463,754 

1913 

24.68 

2,450,000,000 

114,000,000 

735,  737,  200 

1,648,262,800 

RELATIVE  COPPER  MOVEMENTS. 2 


Year. 

Prices. 

Produc- 
tion. 

Stocks. 

Exports. 

Domestic 
consump- 
tion. 

1913 

100 

100 

100 

100 

100 

1914  .          .                

85 

95 

86 

103 

76 

1915                                                                                 .     .   . 

113 

101 

165 

83 

128 

1916 

183 

140 

78 

96 

176 

1917  

188 

•    150 

121 

138 

162 

1918 

159 

152 

108 

90 

203 

The  later  considerations  in  detail  of  a  proper  price  to  allow  the 
producers  for  their  refined  copper,  and  the  contrast  in  the  movement 
of  copper  prices  and  steel  prices  fixed  at  the  same  time,  require  a  more 
minute  study  of  the  quotations  than  the  above  yearly  figures  afford. 
There  follows  a  list  of  monthly  quotations  of  electrolytic  copper  at 
Xew  York,  showing  prices  per  pound  from  1913  to  1918 : 3 

ELECTROLYTIC  COPPER  PRICES. 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

Cents. 
16  75J 

Cents. 
14  45 

Cents. 
13  71 

Cents. 
24  10 

Cents. 
30  26 

Cents. 
23  50 

February         

15  27 

14.67 

14  57 

27  46 

35  22 

23  50 

March 

14  92  i 

14  33J 

14  96 

27  44 

35  74 

23  50 

\pril      

15.48 

14.34 

17.09 

29  31 

32.19 

23  50 

May 

15  63 

14  13 

18  60 

29  81 

32  32 

23  50 

14  85 

13  814 

19  71 

27  494 

32  57 

23  50 

July       

14  57 

13  49 

19  08 

25  60 

28  90 

25  89 

August 

15  68 

12  41% 

17  22 

27  36^ 

27  13 

26  00 

September  

16.55 

12.  084 

17.  704 

28.26 

25.  45 

26.00 

October  .  .                  

16  54 

11  40 

17  86 

28  64 

<23  50 

26  00 

November 

15  47 

11  74 

18  83 

32  22J 

23  50 

26  00 

December    

14  47 

12  93 

20  35 

33.84 

23.50 

25.  284 

1  The  price  table  was  taken  from  Metal  Statistics  for  1910  ;  the  tables  showing  produc- 
tion, stocks  on  hand,  and  apparent  domestic  consumption  from  the  United  States  Geo- 
logical Survey  ;  and,  finally,  that  showing  exports,  from  the  Bureau  of  Foreign  and  Do- 
mestic Commerce. 

-  The  relative  comparisons   were  made  upon   the  basis  of  the  actual  price,   production, 
slock,   export,  and  consumption  figures  given  above,  taking  the  1013  figure  in  each  case 
as  equal  to  100. 

3  Metal  Statistics  for  1010,  p.  231. 

*  Price  fixed. 

125547°— 20 18 


274 


HISTORY   OF   PRICES   DURING  THE   WAR. 


Electrolytic  copper,  a  month  before  this  country  declared  war, 
attained  its  high  price  for  the  whole  war  period  at  nearly  36  cents  per 
pound,  an  increase  of  140  per  cent  over  its  prewar  level.  Then, 
however,  it  began  to  drop  and  continued  falling  until  stabilization 
was  brought  to  the  market  through  price  fixing.  It  is  notable  that 
the  peak  in  the  copper  market  came  four  months  prior  to  that  in  the 
steel  market,  though  formal  price  fixing  took  place  at  the  same  time. 

Clearly,  the  Government  did 
not  start  regulating  copper  to 
check  a  runaway  market. 

The  early  allied  purchases^ 
The  most  striking  feature  of 
the  copper  situation  in  1916,  the 
year  just  preceding  our  entrance 
into  war,  was  the  phenomenal 
increase  in  production  in  the 
United  States  because  of  for- 
eign business  placed  here  with 
manufacturers.  The  foreign 
orders  were  the  largest  ever 
known,  and  sales,  with  approxi- 
mate prices  were  as  follows :  To 
Great  Britain,  December,  1915, 
120,000,000  pounds,  at  22  cents ; 
to  France,  March,  1916,  100,- 
000,000  pounds,  at  27 cents;  and 
to  England  and  France,  Sep- 
tember, 1916, 448,000,000  pounds 
at  27  cents.  This  total  of  more 
than  950,000,000  pounds  that 
the  Allies  took  from  the  mar- 
ket, together  with  what  was 
contracted  for  by  American  consumers,  left  the  refineries  bare  of  sup- 
plies. For  the  last  three  months  after  the  large  September  sale,  cop- 
per averaged  31^  cents.  Domestic  buyers,  because  of  high  prices,  had 
allowed  stocks  on  hand  to  run  low,  and  then  with  the  continuing  ad- 
vance, hesitated  to  accumulate  supplies.  The  excessive  foreign  buying 
though  done  with  no  little  care  to  avoid  overturning  the  market, 
gave  a  feverish  and  speculative  market  during  1916  and  brought 
about  an  undeniable  threatened  world  shortage  of  copper  by  the 

beginning  of  1917.1 

{ _ _ 

1  "  The  Price  Fixing  of  Copper,"  by  Lewis  Kennedy  Morse,  in  the  Quarterly  Journal  of 
Economics,  November,  1918. 


Relative  prices. — Copper,  electrolytic. — By 
months,  January,  1913,  to  December,  1918. 
(Average  quoted  prices,  July,  1913,  to 
June,  1914=100.) 


GOVERNMENT   CONTROL   OVER  PRICES.  275 

It  was  deemed  best,  since  heavy  Government  buying  must  continue, 
to  change  the  policy  of  foreign  buying  in  order  not  to  excite  the  mar- 
ket. While  manufactured  products,  wholly  or  partly  finished,  con- 
tinued to  be  purchased  in  record-breaking  quantities  and  at  the 
highest  prices,  foreign  Governments  thereafter,  instead  of  taking 
specified  amounts  of  refined  copper,  bought  only  from  time  to  time, 
and  at  the  best  possible  price,  such  copper  as  could  be  secured  from 
the  large  producers.1  Fewer  large  sales  were  featured  in  the  trade 
news. 

The  allied  purchase  of  77,000,000  powids.—In  August  of  1917  it 
was  brought  officially  to  the  attention  of  the  War  Industries  Board 
that  the  French  were  in  the  market  for  12,000  tons  of  copper  for 
August  shipment  which,  together  with  known  immediate  British 
needs,  made  a  total  of  60,000,000  pounds.2  It  wras  the  opinion  of  the 
board  that  the  producers  should  be  called  into  conference,  bearing 
in  mind  their  firm  offer  to  the  Government  of  copper  for  25  cents 
per  pound,  and  that  a  tentative  price  of  20  cents  per  pound  be 
offered  them  for  the  above  lot.  This  price,  it  was  agreed  in  meeting, 
should  be  subject  to  revision  upward  or  downward  later.3  It  was 
on  the  following  day  moved  that  if  the  copper  producers  refused  to 
enter  into  this  agreement,  the  Government  would  proceed  to 
commandeer  the  necessary  supply.4  The  board,  in  order  to  meet  the 
determined  opposition  in  the  industry  to  sales  at  a  memorandum 
price,  modified  its  initial  figure  and  passed  the  following  resolution : 5 

That  as  the  copper  emergency  required  immediate  action  necessary  to  secure 
a  supply  for  our  Government  and  our  allies,  the  board  endeavor  to  secure 
from  the  copper  interests  the  needs  of  ourselves  and  our  allies  at  a  price  to 
be  fixed  when  we  will  see  the  report  of  the  Federal  Trade  Commission  as  to 
the  costs  and  for  purposes  of  payment  on  account  of  deliveries,  a  tentative 
price  of  22£  cents  to  be  fixed  with  the  understanding  that  this  price  shall  in 
no  way  be  taken  into  consideration  when  the  final  price  is  to  be  determined. 

Finally,  in  the  middle  of  August,  the  copper  interests  agreed  to 
deliver  77,000,000  pounds  of  copper  to  the  Allies  on  a  memorandum, 
no  price  to  be  paid  pending  the  final  fixing  of  a  price 6  after  an 
investigation. 

The  early  Government  purchases. — Shortly  before  this  country 
made  its  formal  declaration  of  war,  and  again  within  three  months 
afterwards,  there  were  placed  with  the  producers  two  Government 
orders  for  copper  which  affected  vitally  and  hastened  the  price  fix- 

1  Statement  from  Mr.  Lewis  Kennedy  Morse. 

2  On  Aug.   9,   1917,  the  board   considered  still  an   additional   request  from   the   Italian 
Government  for  40,000  tons  of  copper. 

3  War  Industries  Board  Minute  Book,  Aug.  7,  1917. 
*  Ibid.,  Aug.  7,  1917. 

s  Ibid.,  Aug.  8,  1917. 

«  Ibid.,  Aug.  15  and  16,  1917. 


276  HISTOKY   OF   PRICES   DURING  THE   WAR. 

ing  of  copper.  The  two  orders,  embracing  altogether  105,510,000 
pounds  of  refined  copper,  were  placed  at  strangely  different  prices 
because  of  instability  in  the  market.  The  price  for  the  earlier  order 
was  6.83  cents  below  that  finally  fixed  in  September  and  that  for 
the  later  order  1.50  cents  above.  The  fact  that  the  Government  had 
been  able  to  negotiate  a  large  purchase  in  the  spring  of  1917  at  a 
price  so  favorable,  gave  it  a  lever  to  hold  firmly  for  a  favorable 
price  in  September,  just  as  the  second  purchase  at  a  higher  figure  m 
the  summer  of  1917  gave  the  industry  a  weapon  in  their  holding  out 
for  a  higher  fixed  price.  Each  purchase  had  its  influence  upon  copper 
price  fixing. 

The  Government  purchase  of  45,510,000  pounds  in  March,  1917. — 
The  principal  copper  producers  of  the  country,  it  was  announced 
on  March  20,  1917,  offered  to  supply  the  Army  and  Navy  with 
45,510,000  pounds  of  copper  at  a  price  of  16.6739  cents  a  pound  for 
delivery  beginning  in  April  and  continuing  quarterly  for  a  year. 
This  unusually  favorable  purchase,  negotiated  by  Mr.  Bernard  M. 
Baruch  then  of  the  Council  of  National  Defense,  was  made  at  a 
time  when  the  regular  market  quotations  were  35.74  cents  per  pound 
and  sales  were  being  made  at  37  cents  in  the  open  market.  The 
amount  of  that  metal  which  was  to  go  to  the  Navy  was  20,000,000 
pounds  and  that  to  the  Army  25,510,000  pounds.1  The  purchase 
price  agreed  upon  represented,  not  the  price  which  those  amounts 
might  have  commanded  in  the  market,  but  the  actual  average  selling 
price  covering  the  10-year  period  from  1907  to  1916,  inclusive.2 

The  Government  purchase  of  60,000,000  pounds  in  June,  1917. — 
Another,  and  larger,  order  for  60,000,000  pounds  of  copper,  as  an- 
nounced June  27,  1917,  was  placed  by  the  Government  for  early 
delivery  at  a  tentative  price  of  25  cents  a  pound.  The  open  copper 

1  The  Commercial  and  Financial  Chronicle,  Mar.   24,   1917,   p.   1108. 

2  Mr.  Bernard  M.  Baruch,  after  spending  a  week  in  conference  with  the  large  produc- 
ing and  smelting  interests  of  the  country,  received  the  following  letter  from   them   on 
Mar.  24,  1917,  as  their  written  record  of  the  agreement  reached  : 

"  Referring  to  our  several  conversations  on  the  subject  of  supplying  copper  for  the 
Army  and  Navy,  to  the  letter  of  the  Secretary  of  the  Navy  of  Mar.  16,  and  the  tele- 
gram of  the  Secretary  of  War  of  Mar.  18,  both  addressed  to  you,  on  behalf  of  the  prin- 
cipal producers  of  copper  in  this  country,  we  beg  to  say  that  we  will  furnish  the  quan- 
tity  named  for  delivery  within  twelve  months,  viz  : 

"  Twenty  million  pounds  for  the  Navy  and  25,510,000  pounds  for  the  Army,  in 
approximately  equal  quantities  each  quarter  from  April,  1917,  to  April,  1918,  at  a  price 
of  16.6739  cents  per  pound,  delivered  in  regular  shapes  at  Atlantic  seaboard  points. 

"  The  price  named  is  the  actual  average  selling  price  obtained  by  the  United  Metals 
Selling  Co.,  the  largest  seller  of  copper,  over  the  period  of  10  years,  1907  to  1916,  in- 
clusive, and  represents  in  our  opinion  the  fair  average  price  of  all  copper  sold  by 
American  producers  during  that  time. 

"  We  offer  the  copper  at  this  price  notwithstanding  our  costs  for  labor,  materials,  sup- 
plies, etc.,  vary  from  30  to  75  per  cent  above  the  average  during  the  10-year  period,  be- 
cause we  believe  it  to  be  our  duty  to  furnish  the  requirements  of  the  Government  in 
preparing  the  nation  for  war  with  no  profit  more  than  we  received  from  our  regular 
production  in  normal  times.  It  is  understood  that  the  price  quoted  above  is  for  the 
quantity  and  period  of  delivery  above  named." 


GOVERNMENT   CONTROL  OVER  PRICES.  277 

market,  standing  at  the  time  at  32.57  cents  per  pound,  was  not  secure, 
largely  by  reason  of  actual  and  threatened  labor  troubles.  The  price 
set  was  made  tentative,  subject  to  revision  later  when  a  Government 
price  might  be  fixed.1  Secretary  of  the  Navy  Daniels  shortly  after- 
wards announced  that  he  would  agree  to  pay  75  per  cent  of  the  above 
set  price  (25  cents),  or  18.75  cents  per  pound,  for  the  Government's 
order  of  60,000,000  pounds,  leaving  25  per  cent  per  pound  for  adjust- 
ment when  the  cost  of  production  shall  have  been  determined  by  the 
Federal  Trade  Commission,  The  announcement  of  this  policy, 
which  was  interpreted  by  some  as  an  indication  of  what  price  the 
Government  intended  to  fix,  gave  concern  in  some  market  quarters.2 

The  War  Industries  Board  agreed  to  advance  22.50  cents  and  to 
leave  the  difference  between  22.50  and  25  cents  to  the  findings  of  the 
Federal  Trade  Commission.  The  indebtedness  of  the  Government 
to  producers  soon  ran  into  millions  of  dollars,  and  refineries  were 
short  of  blister  and  running  at  from  60  per  cent  to  75  per  cent 
capacity.3 

Meantime,  our  entrance  into  war  and  the  increasing  copper  require- 
ments found  the  market  with  scarcely  enough  copper  to  meet  contract 
needs,  even  by  calling  existing  stocks  into  use,  watching  supplies,  and 
carefully  conserving  every  pound  of  copper.  Every  pound  of  copper 
had  to  be  allotted  by  a  careful  matching  of  output  with  consumers' 
needs,  and  where  some  particular  brand  of  copper  was  required  by 
the  Government,  existing  contracts  were  released.  Such  were  the 
abnormal  and  almost  panicky  conditions  in  the  fall  of  1917,  requiring 

1  Commercial  and  Financial  Chronicle,  June  30,  1917,  p.  2603. 

2  The  Boston  News  Bureau,  July  13,  1917,  said  in  part : 

"  At  this  writing  it  is  not  known  whether  the  copper  producers  will  accept — without 
further  parleys — the  offer  of  Secretary  Daniels  to  purchase  60,000,000  pounds  of  cop- 
per at  what  is  equivalent  of  181  cents  (75  per  cent  of  25  cents),  with  adjustment  later  on 
of  61  cents  (25  per  cent  of  25  cents),  which  is  the  balance  of  the  25-cent  figure  named 
by  the  producers. 

"  Any  price  less  than  25  cents  would  involve  serious  labor  controversies,  and  just  now 
labor  is  demanding  more  than  it  had  already  agreed  to  accept  on  the  sliding  scale  basis — 
and  has  tied  up  the  copper  producing  industry  of  Arizona,  the  biggest  producing  section 
of  the  country,  in  order  to  force  its  demands." 

The  Wall  Street  Journal  of  the  same  date,  said  in  part : 

"  Small  copper  sellers  have  lowered  prices  for  all  deliveries.  They  are  quoting  July 
at  29J  cents  a  pound ;  August,  29 ;  September,  28J  ;  October-November-December,  27J. 
This  represents  a  reduction  of  one:half  to  1  cent  a  pound.  However,  little  business  is 
being  transacted.  Inquiries  are  light,  and  leading  producers  show  little  inclination  to 
quote  September  and  last-quarter  deliveries  until  the  strike  situation  clears. 

"  Washington's  action  in  naming  what  appears  to  be  a  tentative  price  of  18|  cents 
a  pound,  covering  the  60,000,000-pound  lot  which  was  booked  last  week,  leaving  the  re- 
maining 6|  cents  a  pound  subject  to  adjustment  by  the  Federal  Trade  Commission,  has 
not  helped  the  copper  situation. 

"  It  is  pointed  out  that  the  miners  are  being  paid  on  the  basis  of  30-cent  copper,  and 
that  the  average  wage  scale  in  June  was  $5.85.  In  view  of  unsettled  labor  conditions, 
prevailing  high  costs,  and  the  predicted  falling  off  both  in  mine  and  refinery  output,  pro- 
ducers contend  that  they  should  at  least  receive  a  flat  price  of  25  cents  a  pound." 

»  "  The  prices  of  Ferroalloys,  Nonferrous  and  Rare  Metals,"  by  H.  R.  Aldrich  and  Jacob 
Schmuckler,  W.  I.  B.  Price  Bulletin  No.  34. 


278  HISTORY  OF   PRICES   DURING  THE   WAR. 

supervision  and  ordered  control  by  the  Government  agencies  in 
cooperation  with  the  copper  producers  committee.1 

Electrolytic  copper  fixed  on  September  21, 1917. — The  story  of  how 
copper  came  finally  to  be  fixed  at  23.50  cents  on  September  21,  1917, 
is  not  really  a  complete  one,  unless  preceded  by  a  mention  of  the  not 
widely-known  decisions  reached  earlier  by  the  War  Industries  Board 
to  fix  it  at  a  lower  figure  and  the  storm  of  protest  made  to  the  Gov- 
ernment by  the  copper  interests.  The  original  formal  fixing  o|  a 
copper  price,  made  early  in  September  but  not  announced,  the  meet- 
ing of  the  War  Industries  Board  with  the  copper  men  immediately 
afterward  to  discuss  in  more  detail  the  copper  problem,  the  fixing 
of  a  final  price  the  latter  part  of  September,  and  the  interpretation 
put  upon  its  own  action  by  the  board  are  all  essential  parts  of  the 
story. 

The  determination  of  the  Government  to  fix  the  price  at  22  cents. — 
The  War  Industries  Board  met  September  5,  1917,  and,  after  dis- 
cussing the  report  upon  costs  of  producing  copper  made  by  the 
Federal  Trade  Commission,  reached  a  definite  conclusion  to  fix 
copper  at  22  cents  per  pound.  To  that  end  it  passed  the  following 
formal  resolution : 2 

Upon  motion  duly  made,  seconded,  and  unanimously  adopted,  it  was  decided 
to  recommend  to  the  President,  in  accordance  with  his  instructions  to  Mr. 
Baruch,  that  a  price  of  22  cents  per  pound  f.  o.  b.  New  York  be  offered  the 
copper  producers  for  the  United  States  Government  requirements  of  copper. 
Mr.  Baruch  was  asked  to  notify  the  President  that  the  board  is  now  ready  to 
confer  with  him  on  this  subject. 

The  copper  interests  ask  for  a  price  of  25  cents. — The  copper  inter- 
ests, in  order  that  they  might  be  made  aware  of  the  attitude  of  the 
board,  were  called  to  Washington  on  September  11,  and  told  that 
the  board  felt  that  22  cents  per  pound  f.  o.  b.  New  York  for  refined 
copper  was  a  fair  price  and  would  allow  the  producers  a  reasonable 
profit.  The  price,  they  were  told,  would  hold  for  a  certain  period 
only  and  could  then  be  revised  upward  or  downward.  The  board 
told  the  producers,  too,  that  that  price  had  been  determined  upon  as 
one  applicable  alike  to  the  Government  and  its  Allies,  and  that 
wages  to  labor  should  remain  the  same  notwithstanding  the  sliding- 
scale  agreement. 

Mr.  John  D.  Ryan,  in  person,  then  and  by  a  long  written  memo- 
randum three  days  later,  represented  the  viewpoint  of  the  copper 
interests  to  the  Government  through  the  War  Industries  Board.3 

1  The  copper  producers  committee,  while  not  responsible  for  fixing  prices  in  the  sense 
that   the    American    Iron    and    Steel    Institute   was,    did    assume    responsibility    for    the 
allocations. 

2  This  minute  was  taken  from  the  War  Industries  Board  Minute  Book,  for  Sept.  5,  1917. 
8  See  War  Industries  Board  Minute  Book  for  Sept.   11,   1917  ;   also  a  letter  from  Mr. 

John  D.  Ryan,  representing  the  copper  interests,  addressed  to  the  War  Industries  Board 
on  Sept.  14,  1917. 


GOVERNMENT   CONTROL   OVER   PRICES.  279 

He  said  flatly  that  the  copper  interests  could  not  control  the  price 
to  the  public  at  a  point  much  below  25  cents,  and  that  if  the  Govern- 
ment fixed  22  cents  as  the  price,  then  the  small  high-cost  producers 
would  not  voluntarily  cooperate  in  selling  at  the  fixed  price.  There 
would  result,  he  contended,  even  more  acute  labor  troubles  should  the 
then  existing  sliding  scale  of  rates  be  disturbed.  These  points,  after 
emphasizing  the  impracticability  of  the  Government  commandeering 
the  numerous  small  high-cost  mines,  he  dealt  upon  in  more  detail. 

Mr.  Ryan  and  his  associates,  in  proof  of  these  arguments,  gave  evi- 
dence to  show  that  if  22  cents  per  pound  was  finally  fixed,  it  would 
1)6  impossible  to  obtain  the  cooperation  of  the  majority  of  mine 
owners.  The  copper  industry,  while  its  bulk  of  business  was 
highly  concentrated  in  the  hands  of  a  few  producers,  embraced 
after  all  a  large  number  of  smaller  high-cost  producers  whose  product 
was  needed  in  the  extraordinary  emergency.  But  he  assured  the 
board  that  if  it  would  allow  a  fixed  price  of  25  cents  per  pound, 
which  the  industry  at  large  was  holding  out  for,  there  would  be  no 
difficulty  in  distributing  the  copper  properly  and  controlling  its 
prices.  If  the  higher  price  was  not  allowed,  he  said,  the  300,000,000 
pounds  produced  outside  of  the  United  States  could  not  be  con- 
trolled.1 

Not  the  most  salient  of  all  the  reasons  advanced  by  the  copper 
men  for  a  higher  price  was  the  intricate  bearing  which  they  clearly 
showed  to  exist  between  labor  and  copper  prices.  There  are  indeed 
few  raw  materials  of  which  so  large  a  percentage  of  the  cost  of  pro- 
duction goes  to  pay  wages.  It  was  argued  that  the  wages  of  all 
men  in  the  copper  industry  had  been  advanced  50  per  cent  over 
those  prevailing  in  1915,  and  that  in  the  more  important  western 
mining  camps  the  wages  were  determined  upon  a  sliding  scale, 
based  on  the  price  of  copper.2  The  labor  unrest,  while  not  so  mani- 
fest in  the  copper  industry  until  the  summer  of  1917,  had  become 
serious  and  the  producers  feared  the  consequences  should  the  price 

ilt  is  noteworthy  that  during  the  interim  between  the  appearance  of  the  copper 
men  in  Washington  and  the  later  memorandum  from  them  the  War  Industries  Board 
had  virtually  made  up  its  mind  to  the  necessity  of  fixing  a  price  of  25  cents  for  copper. 
The  secretary  of  the  War  Industries  Board,  on  Sept.  12,  1917,  addressed  the  following 
letter  to  the  chairman  of  the  raw  materials  committee : 

"  This  will  confirm  to  you  the  action  of  the  War  Industries  Board  taken  to-day  that 
the  Government  pay  for  copper  for  uses  of  the  United  States  Government  and  the  allied 
governments  and  the  consuming  public,  25  cents  per  pound  f.  o.  b.  New  York. 

"  It  is  requested  that  you  arrange  a  conference  with  the  President  to  advise  him  of 
this  decision  of  the  board." 

2  These  sliding  scales  provide  for  the  minimum  wages  of  $3.50  per  day  of  eight  hours 
lor  miners  and  men  employed  underground,  and  $4.50  for  mechanics,  with  many  higher 
classifications  where  skilled  labor  is  necessary ;  the  minimum  to  apply  when  copper  sells 
below  15  cents  per  pound,  and  25  cents  additional  per  day  to  every  man  employed  to 
be  paid  for  each  2-cent  advance  in  the  price  of  copper  above  15  cents.  The  result 
had  been  that  for  over  a  year  wages  were  based  on  a  price  of  copper  at  27  cents  and 
above,  so  that  miners  were  receiving  $5  to  $5.25  per  day,  and  all  mechanics  $6.25  to 
$6.50  per  day. 


280  HISTORY   OF   PRICES   DURING   THE   WAR. 

for  copper  be  set  at  a  figure  so  low  as  to  require  a  cut  in  wages  or  in 
the  laborers'  returns  under  the  sliding-scale  rule.  The  producers 
would,  they  said,  endeavor  to  pay  employees  the  same  wages  which 
they  had  been  receiving  during  the  months  preceding  based  upon  a 
price  of  27  cents  and  over,  should  the  Government  fix  the  price  at 
not  lower  than  25  cents.  Even  with  the  best  of  fortune,  the  producers 
feared  then  that  the  closing  of  mines  through  strikes  would  cut 
short  the  production  of  copper  between  September  and  January  1. 
1918,  by  140,000  tons. 

The  industry  made  a  proposal  to  the  Government,  in  its  contention 
for  a  price  of  25  cents  for  copper,  which  has  a  peculiar  war-time  in- 
terest, coming  early  as  it  did  before  the  Government  had  got  really 
into  the  problem  of  raw-.material  regulation.  It  was  submitted  by 
Mr.  Ryan  in  his  long  memorandum  of  September  14,  and  was  out- 
lined in  part  as  follows: 

While  some  of  the  low-cost  producers  will  show  a  large  profit  at  25  cents, 
some  of  the  largest  and  practically  all  of  the  small  producers  can  not  show 
more  than  the  usual  peace-time  profit  at  that  price,  and  if  depletion  of  mines  is 
considered,  their  profit  would  probably  be  less  than  in  normal  times  at  average 
prices.  We  believe  that  it  would  be  to  the  interest  of  the  Government  to  pay 
25  cents  per  pound  .and  to  take  all  of  the  production  of  all  of  the  mines  of  the 
country  at  that  price,  retaining  all  the  copper  which  is  needed  for  this  Govern- 
ment and  for  its  allies,  and  selling  the  balance  at  the  same  price,  or  approxi- 
mately the  same  price,  to  the  public. 

The  leading  copper  producers  finally,  on  September  14,  met  in 
New  York  and  decided  among  themselves  to  split  the  difference  in 
price  between  that  set  by  the  Government  at  22  cents  and  that  asked 
by  the  producers  at  25  cents,  and  according^  offered  their  full 
cooperation  if  the  Government  would  allow  them  a  fixed  price  of 
23.50  cents.  The  record  of  that  decision  as  given  to  the  Government 
follows  r1 

The  representatives  of  the  copper  producers  who  attended  our  conference  on 
Tuesday  and  Wednesday  met  in  New  York  to-day  at  my  request,  and  I  recom- 
mended to  them  as  a  result  of  my  talk  with  members  of  your  board,  looking 
toward  a  compromise  in  the  matter  of  price  that  would  result  in  obtaining  the 
full  assurance  of  cooperation  and  effort  on  the  part  of  the  copper  producers, 
which  we  were  all  certain  at  our  conference  in  Washington  could  not  be  secured 
at  any  price  less  than  25  cents,  that  a  compromise  be  agreed  upon  at  23$ 
cents  per  pound.  With  one  exception  those  present  agreed  that  if  your  com- 
mittee would  unanimously  recommend  a  price  of  23£  cents  *  *  *  that  we 
would  still  be  able  to  get  the  practical  result  that  we  are  aiming  for,  that  is, 
pretty  nearly  maximum  production;  therefore  I  would  say  that  if  your  com- 
mittee would  agree  to  23$  cents  we  can  pledge  the  copper  industry  almost  as  a 
whole  to  use  every  possible  means  to  secure  a  maximum  production  and  to 
maintain  the  present  scale  of  wages,  and  I  am  satisfied  we  can  succeed. 

1  Letter  to  the  War  Industries  Board  by  John  D.  Ryan,  dated  Sept.  14,  1917. 


GOVERNMENT   CONTROL  OVER  PRICES.  *'        281 

The  price  -fixed  at  %3\  cents.— Finally,  on  September  21,  1917,  the 
War  Industries  Board  definitely  fixed  the  price  of  refined  copper, 
free  on  board  New  York,  at  23J  cents  per  pound.  The  regulation 
was  in  the  form  of  an  agreement  between  the  Government  and  the 
producers  and,  as  approved  by  the  President,  was  subject  to  revision 
after  four  months.  The  same  price  later  was  continued  in  effect 
until  June  1,  1918.1  Under  the  agreement  the  copper  producers 
pledged  themselves  not  to  reduce  wages  then  paid;  to  sell  their 
product  to  the  Allies  and  the  general  public  at  the  same  price  as 
that  to  be  paid  by  the  Government;  to  exert  every  effort  to  main- 
tain maximum  production  during  the  war ;  and  to  take  the  necessary 
measures  to  prevent  copper  from  falling  into  the  hands  of  specu- 
lators.2 The  new  agreement  on  copper  with  the  Government  was 
satisfactory  to  the  industry.3 

Interpretation  of  the  fixed-price  policies. — The  copper  industry, 
though  immediately  pleased  with  the  new  price  determined  upon  for 
copper,  began  wondering  within  a  week  afterwards  how  the  scheme 
would  be  administered  and  temporary  confusion  was  introduced  into 
the  market.  Neither  the  Government  nor  the  industry  had  yet  ad- 

1  Meeting  of  the  War  Industries  Board,  Jan.  9,  1918. 

2  The  official  announcement  by  the  War  Industries  Board,  on  Sept.  21,   1917,  of  the 
final  fixing  of  a  copper  price  was  as  follows  : 

After  investigation  by  the  Federal  Trade  Commission  as  to  the  cost  of  producing 
copper,  the  President  has  approved  an  agreement  made  by  the  War  Industries  Board 
with  the  copper  producers  fixing  a  price  of  23J  cents  per  pound  f.  o.  b.  New  York,  sub- 
ject to  revision  after  four  months.  Three  important  conditions  were  imposed  by  the 
board  :  First,  that  the  producers  would  not  reduce  the  wages  now  being  paid ;  second, 
that  the  operators  would  sell  to  the  Allies  and  to  the  public  copper  at  the  same  price 
paid  by  the  Government,  and  take  the  necessary  measures,  under  the  direction  of  the 
War  Industries  Board,  for  the  distribution  of  the  copper  to  prevent  it  from  falling  into 
the  hands  of  speculators  who  would  increase  the  price  to  the  public ;  and,  third,  that 
the  operators  pledge  themselves  to  exert  every  effort  necessary  to  keep  up  the  produc- 
tion of  copper  to  the  maximum  of  the  past,  so  long  as  the  war  lasts. 

The  War  Industries  Board  felt  that  the  maintenance  of  the  largest  production  should 
be  assured,  and  that  a  reduction  in  wages  should  be  avoided.  The  stipulation  that 
present  wages  shall  not  be  reduced  compels  the  maintenance  of  the  highest  wages  ever 
paid  in  the  industry,  which  without  such  stipulation  would,  with  a  reduction  made  in 
the  price  of  copper,  be  reduced  under  the  sliding  scale  so  long  in  effect  in  the  copper 
mines.  Within  this  year  copper  has  sold  as  high  as  36  cents  per  pound,  and  the  market 
price  would  now  be  higher  than  it  is,  had  it  not  been  well  known  for  some  weeks  that 
the  Government  would  fix  the  price. 

The  principal  copper  producers  throughout  the  country  have  evinced  an  admirable 
spirit,  and  for  weeks  have  promptly  supplied  every  request  of  the  Government  for  cop- 
per, without  waiting  decision  as  to  price,  and  agreeing  to  accept  the  price  which  the 
Board  should  ultimately  fix.  The  proper  departments  of  the  Government  will  be  asked 
to  take  over  the  mines  and  plants  of  any  producers  who  fail  to  conform  to  the  arrange- 
ment and  price,  if  any  such  there  should  be. 

3  The  Wall  Street  Journal  of  Sept.  21,   1917,  said  in  part :     "  The  copper  trade  was 
mildly   surprised  at  the  announcement  that  the  Government's  price,  as  well  as  that  to 
the  public  and  the  Allies,  had  been  fixed  at  23|  cents  a  pound.     For  some  time  past  they 
had  been  led  to  believe  that  the  price  would  be  in  the  neighborhood  of  221  cents  a  pound. 
The  new  figure  was  made  known  to  some  of  the  big  producers  earlier  in  the  week,   but 
they  were  pledged  to  secrecy,  and  consequently  refrained  from  discussing  the  matter  in 
advance  of  an  official  announcement.     The  consensus  of  opinion  in  the  trade  is  that  the 
new  figure  is  satisfactory." 


282  HISTORY   OF   PRICES   DURING  THE   WAR. 

justed  itself  to  the  detail  of  regulation  or  was  prepared,  at  a 
moment's  notice,  to  answer  all  price-fixing  questions  as  they  arose.1 
The  trade  soon  directed  inquiries  to  the  board  to  learn  what  would 
be  the  status  of  all  outstanding  contracts  with  the  Allies  at  higher 
prices  than  the  fixed  price;  whether  the  new  announcement  would 
allow  that  copper  be  traded  in  for  delivery  after  January  21,  at 
prices  to  be  arranged  by  contract,  regardless  of  the  Government 
fixed  price;  whether  the  Government  contemplated  eliminating  all 
trade  in  copper,  except  at  the  fixed  price;  whether  the  Government 
meant  that  other  prices,  than  those  for  electrolytic  copper  as  such, 
be  fixed  in  line  with  that  base  price ;  and  whether  all  bona  fide  con- 
tracts in  existence  on  September  21  were  to  stand.2 

All  outstanding  contracts  between  producers  and  consumers,  as 
matters  stood,  might,  it  was  understood,  be  consummated  at  book 
prices.  That  called  for  the  delivery  of  copper  at  a  price  as  high 
as  27  cents  a  pound.  Under  the  priority  agreement,  however,  the 
Government  had  first  call,  and  the  Allies  second;  which,  coupled 
with  the  existing  shortage  in  supplies  of  refined  copper,  made  it  very 
difficult  for  American  manufacturers  to  get  copper,  except  to  fill 
Government  orders.8 

The  board,  in  response  to  inquiries  regarding  the  status  after 
January  21, 1918,  ruled  that  all  contract  sales  made  for  delivery  after 
the  expiration  of  the  present  fixed  price  should  be  made  at  a  price 
subject  to  any  revision  which  the  board  might  see  fit  later  to  make. 

It  was  made  known  to  the  Government  shortly  after  control  of 
copper  had  set  in,  that  there  were  a  large  number  of  outside  dealers 
and  brokers,  other  than  producers,  who  were  still  trading  and  quot- 
ing 28.29  and  30  cents  for  copper.  The  gradual  setting  up  of  a 
control  committee  or  selling  agency,  with  Government  sanction  and 
representation,  crowded  off  many  of  these  dealers  who  had  bought 
copper  direct  from  mining  companies  at  figures  higher  than  the 
fixed  price  and  who  would,  under  the  new  price,  be  forced  to  sell 
at  a  loss.  The  board,  however,  held  firmly  to  its  belief  that  the 
fixed  price  should  be  made  applicable  to  all  trading  in  refined  copper. 

The  board  was  strongly  urged,  at  least  from  one  quarter,  to  extend 
the  price  fixing  of  copper  by  establishing  a  scale  of  prices  based  on 

1  The  Wall  Street  Journal  of  Sept.  27,   1917,  said  in  part :  "  A  canvass  of  the  larger 
copper  producers   in   New   York  discloses   great   uncertainty   in   the   copper   market,   not- 
withstanding price  fixing  by  the  Government  for  the  next  few  months.     Both  producers 
and  consumers  are  '  up  in  the  air,'  due  to  lack  of  details  in  connection  with  the  carry- 
ing out  of  the  proposed  plans  for  handling  the  copper  market,   and  this   condition  will 
continue  until  Washington  furnishes  more  detailed  advices  as  to  what  can  be  done  and 
what  should  not  be  attempted  under  the  new  order  of  things. 

2  A  majority  of  these  questions  were  raised  in   a   letter  by  Eugene  Meyer,  jr.,   dated 
Oct.  19,  1917,  to  Mr.  Baruch  and  were  answered  the  same  day  by  the  secretary  of  the 
War  Industries  Board. 

8  Commercial  and  Financial  Chronicle,  Sept.  29,  1917,  p.  1264. 


GOVERNMENT   CONTROL   OVER   PRICES.  283 

modifications,  specifications,  and  shapes,  and  particularly  to  issue 
a  scale  of  prices  on  scrap  copper.  It  ruled,  however,  to  fix  no  other 
prices  than  those  for  electrolytic  copper.1 

Appeal  of  small  high-cost  producers  for  an  increase. — The  relative 
hardship,  if  any,  of  the  fixed  price  of  23J  cents  was  borne  not  by  the 
larger  low-cost  but  by  the  small  high-cost  producers.  Complaints 
from  these  more  numerous  and  less  efficient  concerns,  however, 
became  more  and  more  serious,  since  by  1918  it  was  estimated  the 
Government  was  taking  fully  93  per  cent  of  the  total  copper  supply 
for  the  war  program.  Of  this  amount  the  United  States  was  con- 
suming about  49  per  cent  and  the  Allies  44  per  cent.2  The  Govern- 
ment then  could  not  afford  to  ignore  the  interest  of  any  branch  of  the 
copper  industry.3  The  price-fixing  committee,  however,  after  a  con- 
ference with  the  copper  interests  and  an  examination  of  cost  sheets, 
decided  on  May  22,  1918,  despite  the  apparent  disadvantage  under 
which  certain  high-cost  producers  were  operating,  that  the  price  of 
23J  cents  be  continued  for  at  least  another  75  days,  until  August 
15,  1918.  The  committee  began  fearing  shortly  afterwards,  however, 
that  the  advance  in  freight  rates  and  the  possibility  of  an  increase  in 
the  costs  of  labor  might  make  it  necessary  to  increase  the  price  before 
that  time.4 

Electrolytic  copper  increased  to  26  cents  on  July  2,  1918. — The 
increased  costs  of  producing  copper,5  as  the  price-fixing  committee 
feared,  required  that  relief  be  given  before  the  expiration  of  the 
pending  agreement,  on  August  15.  Accordingly,  the  committee  on 
July  2  increased  the  price  of  electrolytic  copper  from  the  price  of 
23J  cents,  which  had  been  originally  fixed  by  the  War  Industries 
Board  nine  months  before,  to  26  cents  on  July  2,  1918.6  The  new 

1  Oct..  25,  1917,  the  board  allowed  a  differential  of  from  5  to  10  per  cent  for  L.  C.  L. 
shipments  over  the  23|-cent  price  because  of  extra  handling,  in  accordance  with  trade 
practices. 

2  The    Prices   of   Ferroalloys,    Nonferrous,    and    Rare   Metals,    by    H.    R.    Aldrich    and 
Jacob  Schmuckler,  W.  I.  B.  Price  Bulletin  No.  34. 

3  The  Wall  Street  Journal  of  Apr.  30,  reported  that  in  Boston :  "It  is  believed  that  at 
the   meeting  next  month  the  Government  will   make  a  general   advance  in  the   price  of 
copper  to  24 1   cents  per  pound,  this  extra  cent  constituting  a  basis  for  settlement  be- 
tween producer  and  refiner  that  will  be  fair  to  both. 

"  This,  however,  does  not  take  care  of  the  small  army  of  high-cost  producers,  whose 
costs  have  risen  in  some  cases  to  as  high  as  30  cents  a  pound,  but  who  are  operating  on 
a  reduced  scale  in  order  to  keep  their  mines  and  equipment  in  good  condition  and  not 
to  demoralize  their  working  organizations.  About  15  of  these  companies,  with  an  aggre- 
gate capacity  of  75,000,000  pounds  annually,  have  formed  a  committee  and  are  to  present 
their  case  at  Washington  next  month." 

*  Minutes  of  the  price-fixing  committee  for  June  3,  1918. 

5  The  Wall  Street  Journal  of  July  3,  1918,  said  in  part :  "  The  biggest  factors  which 
apparently   influenced   the   price-fixing   committee   in   its   decision   were   the   25    per   cent 
freight  rate  increase  and  the  advancing  prices  for  all  supplies  and  equipment.     As  pre- 
viously   pointed   out,   the  freight   charge   added    at    least    1    cent   a    pound    to   operating 
costs.      Both    items    combined    have    increased    costs    something    like    1\    cents    a    pound 
throughout  the  entire  industry." 

6  The  price-fixing  committee  on  June  5,  1918,  approved  certain  additional  charges  on 
copper  shapes. 


284  HISTORY   OF   PRICES   DURING   THE    WAR. 

agreement  was  to  be  subject  to  revision  again  on  August  15.  The 
maximum  Government  fixed  price  of  26  cents  per  pound  for  electro- 
lytic copper  was  continued  in  effect,  from  time  to  time,  until  the  close 
of  war  and  the  lifting  of  copper  control. 

Summary. — Before  this  country  undertook  a  formal  price  fixing 
of  copper  it  had  helped  to  negotiate  a  purchase  of  77,000,000  pounds 
for  the  Allies  on  a  memorandum  agreement  that  the  price  be  deter- 
mined later,  and  had  itself  purchased  one  order  of  45,510,000  pounds 
of  copper  at  16f  cents  per  pound  in  March,  1917,  and  still  another 
of  60,000,000  at  a  tentative  price  of  25  cents  per  pound,  which  was 
later  lowered.  There  was  a  considerable  disagreement,  when  finally 
the  Government  came  to  fix  a  price  between -the  Government  and  the 
producers  whether  the  price  should  be  22  cents  or  25  cents.  It  was, 
in  point  of  fact,  fixed  at  the  compromise  price  of  23^  cents  on  Sep- 
tember 21,  1917.  Not  until  July  2,  1918,  was  that  price  increased 
to  26  cents,  or  in  any  way  modified.  The  new  and  higher  price, 
which  was  necessitated  by  an  increase  in  freight  rates  and  costs  of 
production,  continued  in  effect  until  the  lifting  of  copper  control 
after  the  war. 

Copper  price  fixing,  undertaken  not  to  peg  prices  and  to  prevent 
their  rising  to  higher  points  so  much  as  to  assure  stable  and  adequate 
production,  was  one  of  the  earliest  and  most  important  of  the  war- 
time controls.  For  all  of  that,  it  was  one  of  the  simplest.  Not 
throughout  the  whole  war  period  did  the  Government  undertake  to 
exercise  widespread  price  fixing  over  other  than  electrolytic  copper, 
the  great  basic  raw  material  of  the  industry.  Such  a  simple  con- 
trol, however,  was  peculiarly  possible  in  the  case  of  copper,  since  the 
Government  itself  took  virtually  the  whole  output  and  was  really 
fixing  a  price  for  its  own  purchases. 

ALUMINUM. 

The  aluminum  industry  in  the  United  States  is  concentrated  in 
the  hands  of  a  single  producer,  and  the  price  situation  during  the 
war  presented  no  problems  especially  difficult.  The  greater  part  of 
the  metal  consumed  in  this  country  is  bought  under  long-time  con- 
tracts, and  although  the  spot  market  was  often  beyond  control  during 
the  war  the  contract  quotations  never  exceeded  reasonable  bounds. 
It  was  not  until  the  middle  of  1915  that  the  aluminum  demands  of 
the  Allied  Governments,  both  for  industrial  uses  and  the  production 
of  "  ammonal,"  1  were  felt  in  the  United  States.  When  these  de- 
mands did  appear  they  upset  the  spot  market,  and  aluminum  prices 

1  "  Ammonal,"  which  is  a  mixture  of  aluminum  dust  and  ammonium  nitrate,  Avas  used  in 
tremendous  quantities  by  the  allied  Governments  in  the  manufacture  of  munitions. 


GOVERNMENT   CONTROL   OVER  PRICES.  285 

started  on  an  upward  course  which  was  equalled  during  war  time  by 
few  commodities.1 

When  the  United  States  entered  the  war,  aluminum  was  selling 
on  the  open  market  at  about  60  cents,  while  contract  prices  ranged 
around  38  cents.  It  was  evident  that  our  war  needs  would  be  very 
large  and  almost  immediately  steps  were  taken  toward  providing  for 
our  necessary  requirements.  Indeed,  it  was  but  19  days  after  the 
memorable  April  6,  1917,  when  the  general  munitions  board  received 
a  letter  from  the  president  of  the  Aluminum  Co.  of  America,  in 
which  he  offered  to  provide  the  United  States  Government  with  ap- 
proximately 2,000.000  pounds  of  ingots  at  2?i  cents  a  pound,  a  price 
about  10  cents  lower  than  the  current  contract  figure  and  less  than 
one-half  of  the  open-market  quotation.  This  offer  was  accepted, 
and  later  extended  to  cover  8,000,000  pounds  to  be  delivered  not 
later  thaji  August  of  that  year.  When  the  time  came  for  the  renewal 
of  this  contract  in  September,  however,  the  Aluminum  Co.  of 
America  appears  to  have  been  doubtful  whether  27|  cents  was  a  just 
price.  Price-fixing  talk  had  already  begun  to  circulate  in  the  trade, 
and  it  was  believed  by  those  interested  that  some  definite  govern- 
mental action  would  soon  follow.2 

Accordingly,  in  September,  1917,  the  Aluminum  Co.  of  America 
agreed  with  the  War  Industries  Board  "  to  accept  direct  and  indi- 
rect Government  orders  at  the  prevailing  contract  price"  (38  cents) 
and  to  refund  to  the  Government  any  difference  which  existed  be- 
tween this  contract  price  and  any  "  fixed  price  "  which  might  be  de- 
cided upon  at  a  later  date.3 

Meanwhile,  the  Federal  Trade  Commission  had  been  asked  to  look 
into  the  cost  records  of  the  Aluminum  Co.  of  America  preparatory 
to  the  adoption  of  a  definite  fixed  price  on  aluminum  ingots,  and  its 
products.  These  data  were  first  received  by  the  War  Industries 
Board  in  early  1918,  and  on  February  28,  the  War  Industries  Board 

1  January,  1915,  found  prices  at  19.08  cents  or  slightly  below  the  prewar,  average.     By 
April  aluminum  was  selling  for  18.88  cents  on  the  open  market,  a  figure  which  was  lower 
than  the  contract  price.     In  May  the  extraordinary  rise  began  and  quotations  for  that 
month  were  around  22  cents.     The  following  month  saw  aluminum  selling  for  30  cents, 
while  before  the  year  came  to  an  end  the  open-market  price  was  quoted  at  57.73  cents. 
Thus,  a  rise  of  over  190  per  cent  was  experienced  within  a  single  year.     This  rise  con- 
tinued in  a  more  moderate  degree  through  1916,   the  highest  point  being  in   November, 
when  aluminum  sold  for  65.12  cents.     It  has  been  said  "  that  many  concerns  took  down 
their   aluminum   transmission  lines  during  1915  and   1916  and  replaced  them  by   copper 
wire  in  order  to  take  advantage  of  the  abnormal  market  conditions ;  for  with  copper  at  17 
and   18   cpnts   and   aluminum  at  over  50   cents  it   was   possible   to   make   a  change   with 
a    good   profit.      See    War    Industries    Board    Price   Bulletin   No.    34,    "  Ferroalloys,    Non- 
ferrous,  and  Rare  Metals." 

2  This  was  especially  evident  in  view  of  the  growing  demands  of  the  military  forces.     It 
is  estimated  that  the  war  requirements  of  the  United  States  called  for  approximately  63 
per  cent  of  the  aluminum  supply  of  the  country  and  those  of  the  Allies  about  20  per  cent. 
This  made  a  total  of  over  80  per  cent  of  our  supply  which  was  devoted  to  war  needs. 

3  It  was  apparently  presumed  that  any  fixed  price  which  might  be  later  adopted  would 
be  lower  than  the  current  contract  price. 


286  HISTORY   OF   PRICES   DURING   THE   WAR. 

recommended  a  maximum  price  of  32  cents  per  pound  for  aluminum 
ingots  f.  o.  b.  plants  of  the  Aluminum  Co.  of  America.1  This  price 
was  approved  by  the  President  on  March  2,  and  was  made  applicable 
to  all  governmental  and  civilian  purchases  up  to  June  1,  1918. 

On  May  9,  the  question  of  extending  aluminum  prices  after  June  1 
was  brought  before  the  price  fixing  committee.  It  appears  that  the 
producers  in  order  to  supply  the  increasing  war  needs  had  been  com- 
pelled to  enlarge  their  plants,  and  they  felt  that  the  large  cost  of 
such  additions  warranted  an  addition  of  3  cents  per  pound  to  the 
price  soon  to  expire.  A  compromise  was  made,  however,  at  33  cents, 
or  an  increase  of  1  cent  over  the  old  price.  On  August  20,  it  was 
agreed  to  continue  the  33-cent  price  until  March  1,  1919,  when  it 
expired  by  limitation. 

LEAD.  \ 

Expectation  that  the  Government,  after  the  declaration'  of  war, 
would  enter  the  market  for  large  amounts  of  lead  gave  further  stimu- 
lus to  a  market  which  had  been  already  inflated  by  strikes,  traffic 
congestion,  and  large  European  demand.  On  July  1,  1917,  lead  was 
quoted  at  11.17  cents  per  pound,  the  highest  market  price  on  record. 
This  price,  relatively  about  80  per  cent  higher  than  the  market  quota- 
tion for  the  preceding  January,  represented  a  rise  of  160  per  cent 
above  the  average  price  for  the  12  months  preceding  the  outbreak 
of  war.  In  April,  1917,  lead  was  not  over  plentiful  and  domestic  con- 
sumers, fearing  an  even  greater  stringency  after  the  United  States 
began  to  purchase  her  necessary  supplies,  started  to  buy  large  stocks 
for  accumulation.  The  General  Munitions  Board  in  late  May,  1917, 
considered  at  some  length  the  advisability  of  commandeering  suffi- 
cient lead  for  Army  and  Navy  requirements.2  Although  the  Govern- 
ment needs  at  that  time  were  relatively  small,3  it  was  believed  that 
in  the  coming  months  lead  requirements  would  grow.  On  June  18, 
1917,  the  General  Munitions  Board  approved  an  order  for  8,000  tons 
for  July  delivery,  and  25,000  tons  for  delivery  during  August, 
September,  and  October  at  8  cents  per  pound.4 

1  This  price  was  to  apply  to  purchases  in  lots  of  50  tons  or  more  of  ingot  of  98-97  per 
cent  grade.    The  same  differentials  which  had  formerly  been  in  force  were  to  be  continued 
for  the  sundry  other  grades  and  products. 

2  See  minutes  of  the  General  Munitions  Board,  May  23,  1917. 

3  An  announcement  made  in  May  in  an  attempt  to  reorganize  the  lead  market  which  had 
gotten  out  of  control  was  to  the  effect  "  that  the  May  and  June  Government  requirements 
would  not  exceed  2,500  tons."     See  "  Price  of  Ferro  Alloys,  Nonferrous,  and  Rare  Metals," 
War  Industries  Board  Price  Bulletin  No.  34,  by  H.  R.  Aldrich  and  Jacob  Schmuckler. 

4  This  price  it  will  be  noted  was  3.67  cents  lower  than  the  current  market  price.     It 
appears  that  the  raw  materials  committee  experienced  some  difficulty  at  first  in  getting 
its  supplies  at  this  figure,  and  in  early  July  the  question  as  to  whether  they  would  secure 
sufficient  lead  to  meet  requirements  was  a  matter  of  deep  concern.     They  reported  to  the 
General  Munitions  Board  on  July  12,  1917,  that  the  lead  committee  had  written  to  some 
1,100  lead  miners  relative  to  the  8,000  tons  of  lead  which  they  had  agreed  to  deliver  at 
8  cents,  and  that  only  40  replies  had  been  received. 


GOVERNMENT   CONTROL   OVER   PRICES.  287 

This  price  though  considerably  lower  than  the  open  market  price 
was  not  to  prove  as  advantageous  as  it  first  appeared,  for  a  temporary 
over-production  of  lead  soon  broke  the  market.  Even  in  July,  lead 
prices  began  to  fall  back  toward  their  level  of  previous  months,  while 
August  and  September  witnessed  price  declines  which  finally  brought 
market  quotations  for  lead  in  early  October  to  6.71  cents.  This 
price,  which  was  1.39  cents  lower  than  the  Government  agreed 
price,  made  it  evident  to  the  purchasing  authorities  that  they  were 
contending  against  a  very  unstable  market  arid  that  further  action 
would  have  to  be  taken.  The  first  solution  considered  was  a  system 
of  price  fixing.  A  suggestion  to  that  effect  was  made  to  the  War 
Industries  Board  on  October  24,  1917,  but  the  lack  of  sufficient 
cost  data  upon  lead  made  that  method  inexpedient  and  other  means 
for  regulating  lead  prices  were  sought  after.1  The  method  of  price 
regulation  finally  adopted  was  to  average  the  prices  for  each  month 
as  they  appeared  in  the  Engineering  and  Mining  Journal,  and  accept 
the  figure  thus  arrived  at  as  the  price  to  be  paid  on  Government  de- 
liveries for  each  respective  month.  What  really  occurred,  then,  was 
the  inauguration  of  a  contract  under  which  the  United  States  Govern- 
ment agreed  to  purchase  its  supplies  from  the  various  lead  producers 
at  the  average  current  monthly  price.  The  producers  on  the  other 
hand,  agreed  to  supply  the  Government  at  this  price  with  a  minimum 
of  6,000  and  a  maximum  of  12,000  tons  of  lead  each  month. 

With  governmental  requirements  determined,  and  the  price  to  be 
paid  for  Army  and  Navy  supplies  made  relatively  the  same  as  the 
open  market  quotations,  it  was  believed  that  the  element  of  specula- 
tion would  disappear  and  a  more  stable  market  restored.  But  the 
freight  congestion  of  early  1918  upset  all  calculations,  and  with  a 
scarcity  of  lead  bullion  at  the  eastern  refineries  resulting  from  an 
inability  to  get  shipments  through  from  the  Middle  Western  mines, 
spot  market  prices  started  upward.  Moreover,  the  direct  and  in- 
direct war  demands  for  lead  began  to  increase,2  while  a  strike  tied 
rp  the  output  of  the  country's  second  largest  producer  during  the 
greater  part  of  March  end  April. 

The  rise  which  had  started  early  in  the  year  continued  and  by 
June  it  was  feared  that  a  recurrence  of  the  market  upheaval  of  the 
preceding  year  might  come.  On  June  4,  1918,  a  lead  committee 

1  It  was,  moreover,  the  belief  of  the  War  Industries  Board  that  price  fixing  was  unneces- 
sary, since  there  was  a  large  supply  of  lead  in  the  market  and  consequently  little  proba- 
bility of  prices  rising  back  to  the  inflated  levels  of  the  summer  months. 

2  The  total  direct  allotments  of  lead  to  the  United  States  Government  from  July,  1917, 
to  November,  1918,  amounted  to  150,400  tons.     Compared  to  the  total  production  of  the 
country   this   shows   a   direct   war    consumption   of    about   20    per   cent.      A   considerable 
amount,  however,  was  consumed  by  the  Government  in  the  indirect  purchase  of  manufac- 
tured articles,  and  it  is  estimated  that  by  the  middle  of  1918  upwards  pf  60  per  cent  of 
the  domestic  lead  production  was  going  into  war  consumption. 


288  HISTORY   OF   PRICES   DURING   THE   WAR. 

made  up  of  various  members  of  the  trade  was  appointed  at  the 
request  of  the  War  Industries  Board.  To  this  committee  was 
intrusted  the  distribution  of  domestic  lead,  subject  to  the  supervision 
of  the  War  Industries  Board  and  to  them  also  was  virtual!}7  left 
the  oversight  of  market  prices.  The  industry,  moreover,  was  warned 
to  keep  prices  below  excessive  levels,  and  only  sufficiently  high  to 
produce  a  supply  adequate  to  meet  Government  needs.  On  June  14, 
the  lead  producers  committee  agreed  to  sell  no  pig  lead  at  a  price 
exceeding  7.75  cents  per  pound  f.  o.  b.  St.  Louis  or  8.05  cents  New 
York  City ;  while  the  Engineering  and  Mining  Journal  consented  to 
consider  no  sales  made  at  a  higher  figure  in  computing  its  monthly 
average  price  at  St.  Louis. 

In  this  way  the  market  price  of  lead  was  virtually  fixed  to  all 
consumers,  and  although  no  formal  action  was  taken  by  the  price 
fixing  committee  lead  prices  remained  unchanged  from  July  1,  to 
the  sighing  of  the  armistice.1 

ZINC. 

The  zinc  industry  in  1915  experienced  a  market  situation  quite 
similar  to  that  which  characterized  aluminum,  and  from  all  available 
evidence  it  must  be  concluded  that  the  same  forces  can  be  held  ac- 
countable for  both  upheavals.  In  both  instances  it  was  the  large  de- 
mand for  export  purposes  which  caused  the  rise  in  prices.  So 
extraordinary  were  the  requirements  of  the  munitions  makers  for 
zinc  that  regular  zinc  consumers,  such  as  galvanizers  who  were  ac- 
customed to  purchase  on  contract  at  market  prices,  were  virtually 
forced  in  many  cases  to  shut  down  their  plants.2  The  demands  of  the 
American  Army  took  the  form  of  sheet  zinc,  which  was  used  chiefly 
in  the  manufacture  of  boxes  for  packing  explosives.  In  early  July, 
1917,  the  committee  on  raw  materials  of  the  general  munitions  boards  3 
arranged  with  the  producers  for  delivery  of  10,000.000  pounds  of 
zinc  at  12J  cents  per  pound.4  The  market  price  at  this  time  was  19 
cents,  and  it  is  evident,  therefore,  that  a  considerable  saving  had  been 
realized.  Several  later  purchases  were  made  at  prices  varying  from 
12  to  134  cents,  but  it  was  not  until  early  in  1918  that  any  definite 

1  The  final  agreement  entered  into  by  the  Government  relative  to  the  determining  of  the 
price  of  lead  by  average  monthly  prices  at  St.  Louis,  expired  on  Nov.  30,  1918. 

2  The  price  of  spelter  rose  from  4.97  cents  in  December,  1914,  to  22.14  cents  in  June, 
1915,  an  increase  of  approximately  350  per  cent  in  six  months.     This  price  rise  had  a  far- 
reaching  effect  upon  production  within  the  industry  and  the  first  half  of  191.5  witnessed 
the  erection  of  many  new  smelters  as  well  as  the  reopening  of  many  coal-burning  plants 
which  had  been  closed. 

3  A  zinc  committee,  composed  of  leading  representatives  of  the  industry,  was  appointed 
in  April,  1917,  by  the  raAv  materials  section  of  the  Council  of  National  Defense.     The  ac- 
tivities of  this  committee  were  advisory  in  the  procurement  of  supplies  and  the  determina- 
tion of  fair  prices  to  be  paid  by  the  Government. 

4  It  is  interesting)  to  note  at  this  point  that  the  Navy  several  days  previous  had  pur- 
chased an  amount  of  zinc  at  15  cents. 


GOVERNMENT   CONTROL   OVER  PRICES.  289 

form  of  price  fixing  was  adopted.  In  November,  1917,  to  be  sure, 
the  President  had  asked  the  War  Industries  Board  to  fix  the  price  of 
zinc  to  the  public  and  the  Government,  even  though  the  military  re- 
quirements were  only  a  small  per  cent  of  the  total  production.  But 
the  lack  of  cost  data  was  here,  as  in  the  case  of  lead,  the  deterrent 
factor  and  the  matter  was  laid  aside  until  further  information  rela- 
tive to  costs  could  be  collected  by  the  Federal  Trade  Commission.  In 
JanuarjT,  1918,  the  War  Industries  Board  finally  took  the  zinc  situa- 
tion in  hand,  and  after  conferring  with  the  members  of  the  industry 
arrived  at  a  price  which  they  considered  fair,  both  to  producers  and 
consumers.  This  price,  based  on  various  cost  data,  was  placed  at  12 
cents  for  grade  "  A  "  zinc  f .  o.  b.  East  St.  Louis,  subject  to  the  usual 
trade  discounts.  It  was  to  remain  in  force  for  four  months  and  was 
to  become  effective  as  soon  as  approved  by  the  President.  The  price 
of  zinc  sheets,  of  which  80  per  cent  was  being  consumed  for  direct 
and  indirect  war  purposes  was  also  fixed  at  this  time,  the  figure 
adopted  being  15.6  cents  at  plant  or  16  cents  delivered.1  Similarly, 
zinc  slab  prices  were  also  pegged  at  14.6  cents  at  plant.  By  May  the 
market  price  of  Grade  "A"  had  fallen  to  10  and  11  cents,  and  the  ques- 
tion arose  as  to  whether  a  downward  revision  should  be  undertaken 
by  the  price  fixing  committee.  The  various  governmental  authori- 
ties, however,  did  not  believe  that  such  a  policy  should  be  adopted, 
for  they  felt  that  a  high  maximum  price  should  be  maintained  so 
as  to  keep  in  operation  many  of  the  high  cost  mines  whose  product 
was  required  by  the  Army.  The  12  cent  price  was  therefore  con- 
tinued until  September  1.  This  figure  was  also  later  adopted,  in 
spite  of  a  request  for  a  higher  price  by  the  producers,  for  the  three 
months  ending  January  1,  1919. 

NICKEL. 

The  World  War  appears  to  have  had  relatively  little  effect  upon 
the  price  of  nickel  and.  indeed,  it  may  be  said  that  there  were  at  no 
time  any  extraordinary  circumstances  which  demanded  price  inter- 
ference by  the  Government.  As  in  the  case  of  aluminum,  nickel  pro- 

1  This  price  was  2.33  cents  lower  than  the  current  market  quotations.  It  should  be 
added  here  that  not  only  did  the  individual  producers  agree  to  the  above  prices,  but  they 
also  pledged  themselves  to  fulfill  certain  conditions  in  respect  to  the  manner  in  which 
they  would  conduct  their  business.  Thus,  the  following  agreement  was  attested  to  by  the 
producers  : 

It  is  agreed  both  by  the  producers  of  grade  "  A  "  and  of  plate  and  sheet  zinc  that— 

1.  They  will  not  reduce  the  wages  now  being  paid. 

2.  They  will  sell  to  the  Allies,  to  the  Government,  and  to  the  public  at  the  same  price. 

3.  They  will  take  the  necessary  measures  under  the  direction  of  the  War  Industries 
Board  for  the  distribution  of  zinc  to  prevent  it  from  falling  into  the  hands  of  speculators 
who  might  increase  the  price  to  the  public. 

4.  They  pledge  themselves  to  exert  every  effort  necessary  to  keep  up  production  and  to 
insure  an  adequate  supply  so  long  as  the  war  lasts. 

125547°— 20 19 


290  HISTORY  OF  PRICES   DURING  THE   WAR. 

duction  was  concentrated  in  the  hands  of  a  single  concern  and  this 
producer  from  the  very  outset  was  anxious  to  cooperate  with  the 
authorities  in  charge  of  raw  materials.  Thus,  on  August  15,  the 
nickel  interests  arranged  to  supply  nickel  to  the  Government  at  40 
cents  per  pound,  a  price  which  was  20  per  cent  below  the  current 
market  quotation  and  slightly  lower  than  the  prewar  average.  The 
military  demands  for  nickel,  however,  were  very  large,  and  estimates 
place  the  amount  devoted  to  direct  and  indirect  war  uses  as  high  as 
90  per  cent  of  the  total  production.  Despite  the  size  of  these 
demands,  the  supply  was  at  no  time  so  short  as  to  cause  any  serious 
difficulty.  Whatever  shortage  did  exist  at  various  intervals  may 
be  attributed  to  the  limited  capacity  of  the  rolling  mills. 

The  price  of  nickel  was  at  no  time  fixed  and  the  Government 
secured  its  requirements  under  long-time  agreements.  The  Secretary 
of  the  Navy  on  January  4,  1918,  asked  the  War  Industries  Board  to 
fix  a  price,  but  this  body  at  the  time  did  not  consider  such  action 
advisable.  On  January  8,  1918,  the  International  Nickel  Co.,  which 
refines  virtually  all  the  nickel  produced  in  the  United  States,  offered 
to  supply  the  American  and  allied  Governments  with  their  nickel 
requirements  at  35  cents  per  pound  for  ingot  nickel,  38  cents  for  shot 
nickel,  and  40  cents  for  electrolytic  nickel.  The  ingot  price,  it  will  be 
noted,  was  lower  than  the  price  of  the  previous  August,  and  repre- 
sented a  decrease  of  30  per  cent  from  the  market  price  for  January.1 
This  offer  was  accepted  and  the  prices  specified  remained  in  effect  for 
Government  purchases  until  December  31.  One  restriction  was 
added  to  the  agreement,  however,  in  May.  It  appears  that  the 
International  Nickel  Co.  was  having  difficulty  at  about  this  time  in 
filling  its  contracts,  and  the  authorities  in  charge  felt  that  restrictions 
should  be  placed  upon  the  industry.  The  matter  was  therefore 
placed  before  the  price  fixing  committee,  who  discussed  the  fixing  of 
a  definite  price  applicable  to  all  purchases,  but  took  no  action  relative 
to  prices  other  than  to  approve  the  existing  quotations  for  Govern- 
ment orders.  One  concession  was  exacted(  from  the  producers. 
They  were  compelled  to  agree  to  extend  no  old  contracts  or  make  any 
new  future  contracts  which  tied  up  their  production  for  any  period 
of  time  without  first  consulting  the  price-fixing  committee.  In  this 
way  control  over  the  entire  production  of  nickel  was  placed  in  the 
hands  of  the  price  fixing  committee,  and  although  no  price  was  ever 
fixed  or  agreed  to  for  sales  to  the  public,  the  price  of  nickel  (except- 
ing, of  course,  some  10  per  cent  which  did  not  go  into  war  uses)  was 
kept  as  completely  in  check  as  was  the  price  of  any  other  nonferrous 
metal  dealt  with  by  the  price  fixing  authorities. 

1  The  International  Nickel  Co.  further  offered  to  supply  monel  nickel  (two-thirds  nickel 
and  one-third  copper),  which  was  used  in  considerable  quantities  by  the  Navy,  for  32 
and  38  cents  per  pound,  depending  upon  the  grade,  the  former  price  to  be  applied  to 
nickel  for  shot-metal  purposes  and  the  latter  to  finished  rolled  rods. 


GOVERNMENT   CONTROL   OVER   PRICES.  291 

QUICKSILVER. 

The  price  of  quicksilver,  which  in  1916  shot  to  almost  eight  times 
its  average  for  the  year  preceding  the  outbreak  of  the  war,  had 
receded  to  a  normal  level  by  the  time  the  United  States  severed 
relations  with  the  Central  Powers.1  The  year  1917,  however,  wit- 
nessed relatively  high  prices  in  the  quicksilver  industry,  and  the  gen- 
eral run  of  quotations  throughout  the  year  was  almost  200  per  cent 
higher  than  the  prewar  average.  In  spite  of  this  fact  no  action  was 
taken  by  the  military  authorities  relative  to  the  price  of  quicksilver, 
since  their  requirements  when  compared  to  the  total  production  of 
the  country  were  small.  The  speculative  nature  of  the  industry  led 
them  to  believe  that  it  was  but  fair  to  the  producers  to  allow  an  extra 
margin  of  profit  for  civilian  sales.  But  it  soon  became  evident  that 
a  definite  agreement  ought  to  be  made  for  Government  purchases 
to  stabilize  prices  and  expedite  the  placing  of  contracts.  The  pro- 
ducers were  therefore  called  into  council,  and  they  agreed  to  furnish 
the  Government  with  quicksilver  at  $105  per  flask  of  75  pounds, 
delivered  at  the  Mare  Island  Navy  Yard  in  California  or  at  $105.75 
delivered  at  the  Brooklyn  Navy  Yard  in  New  York.  Moreover, 
they  informally  pledged  themselves  not  to  allow  the  market  price  to 
go  beyond  $130  per  flask.  The  importers  also  agreed  to  furnish  sup- 
plies to  the  Government  at  the  same  figure  as  had  been  fixed  for  the 
domestic  product.2 

This  agreement  which  was  to  expire  at  the  end  of  1918  apparently 
was  considered  in  a  very  favorable  light  by  the  members  of  the 
quicksilver  industry.  This  was  especially  so  in  view  of  the  fact 
that  the  cessation  of  hostilities  threatened  the  opening  of  the  Ameri- 
can market  to  foreign  producers.  Accordingly,  on  November  20, 
they  asked  the  price  fixing  committee  to  continue  the  agreed  Govern- 
ment price  after  January  1,  1919.  Conditions  in  the  opinion  of  the 
committee  did  not,  however,  warrant  any  such  action,  and  on  De- 
cember 31  the  price  agreement  with  the  quicksilver  industry  came 
to  an  end. 

TIN. 

Although  the  United  States  is  the  largest  consumer  of  tin  in  the 
world ;  as  in  the  case  of  rubber,  nitrates,  and  several  other  essentials, 
it  is  dependent  almost  wholly  upon  foreign  sources  for  its  supply. 
The  shipping  situation  of  1917-18  threatened  our  supplies  of  pig  tin 
and  as  early  as  May,  1917,  it  was  announced  at  a  meeting  of  the  Gen- 

irThe  freeing  of  the  American  market  from  the  domination  of  Spanish  and  Italian 
Imports  advanced  quicksilver  prices  to  $283  per  flask  by  February,  1916.  Indeed,  prices 
became  so  high  that  explosive  producers  found  it  almost  'impossible  to  fill  their  orders 
for  foreign  countries.  It  was  not  until  the  American  contractors  had  induced  the 
British  Government  to  raise  their  embargo  on  quicksilver  exports  to  the  United  States 
that  a  recession  in  the  American  market  occurred. 

2  The  total  quantity  of  quicksilver  taken  under  this  agreement  was  equal  to  about 
40  per  cent  of  the  domestic  and  imported  supply. 


292  HISTORY  OF   PRICES  DURING   THE   WAR. 

eral  Munitions  Board  that  there  was  an  actual  shortage.  Indeed, 
the  supply  of  tin  in  the  United  States  continued  insufficient  through- 
out the  entire  period  of  American  belligerency,  and  the  Food 
Administration  at  all  times  was  compelled  to  keep  under  control  the 
use  of  tin  plate  in  the  canning  industry.  On  October  21,  1917,  the 
War  Industries  Board,  at  the  request  of  the  food  authorities,  fixed 
the  price  of  tin  plate  at  $7.75  per  box,  a  figure  which  was  about 
one-half  the  current  market  price.1 

Although  it  was  evident  from  the  very  beginning  that  a  strict 
control  would  have  to  be  exercised,  not  only  over  the  American  supply 
but  also  over  such  tin  as  was  needed  by  our  Allies,  it  was  not  until 
the  late  summer  of  1918  that  any  definite  action  was  taken  toward 
the  pooling  of  all  purchases.  The  machinery  for  such  a  centraliza- 
tion of  purchases  was  an  interallied  tin  executive  set  up  in  London 
to  control  and  direct  all  purchases  of  pig  tin  for  the  participating 
countries.  Buying  agents  were  appointed  in  the  various  producing 
countries  and  import  licenses  into  the  United  States  were  granted 
only  for  such  tin  as  was  purchased  through  these  agents.  In  Sep- 
tember, 1918,  the  American  Iron  and  Steel  Institute,  at  the  request 
of  the  War  Industries  Board,  assumed  charge  of  the  importation 
and  distribution  within  the  United  States.  This  organization  then 
was  made  the  sole  consignee  for  all  tin  imported  into  the  United 
States  and  "was  to  receive  and  pay  at  the  source  of  supply  for  all 
tin  allocated  to  the  United  States  by  the  interallied  executive."  Such 
tin,  in  turn,  was  to  be  distributed  at  cost  only  to  consumers,  jobbers, 
and  dealers  in  the  United  States,  who  held  purchasing  licenses 
issued  by  the  War  Industries  Board.2 

In  December,  1918.  the  War  Industries  Board  notified  the  trade 
that  the  interallied  tin  executive  had  allocated  10,169  tons  of  tin 
to  the  United  States,  and  that  this  metal  would  be  distributed  to 
those  who  held  War  Industries  Board  licenses  at  a  price  of  72^  cents 
a  pound  ex  dock  New  York  City.  These  prices  were  to  remain  in 
force  during  December,  1918,  and  January,  1919.  Regulations  were 
enacted  relative  to  the  amount  which  could  be  purchased,  and  the 
profits  of  dealers  who  resold  to  ultimate  consumers  were  fixed  at 
definite  levels.3 

The  international  tin-purchasing  agreement  was  canceled  on 
December  12,  1918,  but  limitations  as  to  imports  were  retained  until 

1  See  Minutes  of  War  Industries  Board,  Oct.  31,  1917. 

3  The  War  Industries  Board  put  the  consumers  of  tin  under  a  license  so  that  whatever 
supply  was  available  might  be  distributed  for  essential  uses  only.  In  applying  for  a 
license  applicants  had  to  state  not  only  how  the  tin  desired  was  to  be  used  but  also 
when  and  where  it  was  to  be  used. 

8  Dealers  who  sold  in  lots  of  5  tons  or  over  were  allowed  to  make  sales  to  consumers 
or  jobbers  holding. purchasing  licenses  at  a  maximum  gross  profit  at  2*  per  cent;  while 
those  who  sold  in  lots  of  less  than  5  tons  were  allowed  a  profit  of  5  per  cent.  Con- 
sumers were  allowed  to  purchase  only  a  fixed  maximum  amount  of  tin,  and  this  was  based 
on  their  consumption  for  the  first  10  months  of  1918. 


GOVERNMENT   CONTROL   OVER   PRICES.  293 

the  amount  allocated  to  the  United  States  had  been  distributed. 
Indeed,  the  restrictions  upon  the  importation  of  tin  are  still  in  force 
(July  15,  1919).  although  the  War  Trade  Board  has  announced  that 
on  August  1  the  distribution  of  the  metal  will  once  more  become 
free.1 

PLATINUM. 

The  necessity  of  having  a  sufficient  supply  of  platinum  in  the 
United  States  for  war  purposes  led  in  July,  1917,  to  an  order  by  the 
Secretary  of  the  Treasury  to  the  effect  that  all  platinum  which 
passed  into  the  United  States  mints  should  be  withheld  from  com- 
mercial uses.  But  this  order  did  not  lead  to  the  accumulation  of 
sufficient  supplies  and  it  was  followed  on  February  23,  1918,  by  a 
Government  requisition  which  covered  the  supplies  and  output  of  the 
14  largest  smelting,  refining,  and  manufacturing  plants  in  the 
country.  On  May  1  a  further  requisition  order,  effective  until  June 
30,  was  issued,  while  on  July  1,  an  order  which  covered  the  supplies 
of  90  per  cent  of  the  firms  doing  business  in  platinum  and  kindred 
metals  was  put  into  effect  for  the  remainder  of  1918.  The  supplies 
thus  requisitioned  were  collected  at  the  United  States  assay  office  at 
New  York  and  in  the  plants  of  the  large  refiners,  and  later  allo- 
cated to  consumers  at  the  order  of  the  War  Industries  Board. 

Since  virtually  the  entire  platinum  supply  was  concentrated  in  the 
hands  of  the  United  States  Government,  some  arrangement  was 
necessary  relative  to  the  prices  to  be  paid  to  original  holders  of  the 
requisitioned  metals.  The  figure  agreed  upon  which  was  later  made 
the  market  price  was  $105  per  Troy  ounce  for  pure  platinum  2  and 
this  price  remained  in  effect  until  December  1. 

COTTON  TEXTILES. 

The  early  need  for  regulation. — One  of  the  several  bodies  created 
as  a  part  of  the  General  Munitions  Board  to  supervise  the  purchasing 
of  the  necessary  war  materials  3  was  the  committee  on  supplies,  for- 
mally appointed  in  February,  1917,  under  the  chairmanship  of  Mr. 
Julius  Rosenwald.  Among  the  many  commodities  with  which  this 
committee  dealt  were  cotton  and  cotton  fabrics,  great  quantities  of 
which  were  being  asked  for  by  the  various  Government  departments. 
Even  in  these  early  days,  when  there  was  no  definite  policy  as  to  the 
size  of  the  Army,  and  consequently  no  idea  as  to  its  prospective 
demands,  the  question  of  prices — those  of  cotton  and  cotton  fabrics 

1  A  complete  review  of  the  tin  situation  in  the  United   States  during  the  period  1913 
to   1918   will   be  found   in   War   Industries   Board   Price   Bulletin   No.    34,    "  Ferroalloys, 
Nonferrous  and  Rare  Metals,"  by  H.  R.  Aldrich  and  Jacob  Schmuckler. 

2  The  price  fixed  for  pure  palladium  was  $135  per  Troy  ounce  and  for  pure  iridium 
$175  per  Troy  ounce. 

3  See  p.  200  of  the  present  volume. 


294  HISTORY   OF   PRICES   DURING  THE   WAR. 

among  others — played  a  significant  part  in  the  committee's  delibera- 
tions. Thus,  on  April  7, 1917,  a  complaint  was  registered  at  a  meeting 
of  the  munitions  board  to  the  effect  that  difficulty  was  being  experi- 
enced with  the  producers  of  raw  cotton,  and  that  a  meeting  would  be 
held  with  representatives  of  the  industry  relative  to  the  fixing  of  a 
price.1  Shortly  afterwards  2  it  was — 

pointed  out  that  cotton  was  costing  the  Government  *  *  *  a  great  deal 
more  than  necessary ;  because  of  the  fact  that  cotton  on  which  bids  were 
*  *  *  being  based  was  extremely  high.  *  *  * 

and  on  the  same  day  the  chairman  of  the  munitions  board  asked  for 
the  right  to  discuss  with  the  chairman  of  the  Council  of  National 
Defense  the  subject  of  prices,  and  to  state  to  the  chairman  that 
the  discussion  had  led  to  serious  recommendations  as  to  limiting  the 
prices  of  cotton.3 

To  assist  the  committee  on  supplies,  both  in  the  issuance  of  clear- 
ances and  priorities  and  in  the  coordination  of  governmental  re- 
quirements, a  cotton  goods  committee,  made  up  of  members  of  the 
trade,  was  appointed  in  May,  1917.  This  body  undertook  to  recom- 
mend to  the  cotton  trade  "  fair "  prices  for  a  number  of  fabrics 
especially  needed  for  the  Army  and  Navy,  and  these  prices  served 
as  a  guide  to  government  purchasing  agents  in  placing  contracts.4 
This  mode  of  price  fixing,  though  embryonic  in  form,  seems  to  have 
been  quite  successful  and  the  prices  recommended  by  the  cotton 
goods  committee  were  accepted  by  influential  manufacturers.  Its 
activities  resulted,  no  doubt,  in  considerable  saving  to  the  govern- 
ment. But  evidence  appears  that  a  large  part  of  this  saving  was 
realized  at  the  expense  of  the  purchasing  public,  and  while  those 
cotton  fabrics  used  in  quantity  by  the  various  war  agencies  were  as 
a  whole  rising  but  slightly  5  the  prices  of  textiles  which  played  little 
part  in  military  and  naval  consumption  continued  a  steady  upward 
trend.  Thus,  for  example,  the  prices  of  ginghams  and  print  cloths, 

1  Minutes  of  the  General  Munitions  Board  for  Apr.  7,  1917. 

2  Ibid.,  minutes,  Apr.  18,  1917. 

3  Raw  cotton  at  this  time  was  selling  for  about  20  cents  a  pound,  a  price  about  50 
,per  cent  higher  than  the  average  for  the  12  months  preceding  the  outbreak  of  the  war 

(see  table  of  prices  on  p.  539),  and  cotton  fabrics  in  general  had  reached  a  level  approxi- 
mately 70  per  cent  above  that  of  the  prewar  year.  The  price  of  the  chief  staple  cotton 
product — sheeting — had  advanced  80  per  cent  above  the  1913-14  average. 

4  Among  others,  cotton  duck  was  an  important  item,  the  price  of  which  was  fixed.     The 
fair  prices  recommended  on  these  fabrics  are  published  in  W.  I.  B.  Price  Bulletin  No.  23. 

5  In  several   cases  such   as   duck,   uniform   cloth,   etc.,   the   Government  price   actually 
fell  during  the  latter  half  of  1917    (see  table  below).     This  may  be  explained  in  part 
by  the  fact  that  most  of  the  cotton  cloths  bought  in  the  early  months  of  the  war  were 
purchased  in  a  highly  competitive  market  in  which  an  individual  Government  department 
had  to  meet  not  only  the  competition  of  the  purchasing  public  and  the  Allies  but  also 
the  competition  of  other  Government  departments.     The  coordination  of  purchases  which 
followed   the   creation    of   the   cotton    committee    undoubtedly    was   an    important    factor 
which  led  to  the  lowering  of  prices  in  the  several  instances  when  a  decrease  was  noted. 

/  The  fact  remains,  however,  that  in  no  known  instance  did  the  price  of  those  cotton  goods, 
the  bulk  of  which  was  consumed  by  the  general  public,  decrease  during  the  last  six 
month  of  1917. 


GOVERNMENT   CONTROL   OVER  PRICES. 


295 


in  the  months  July  to  December,  advanced  approximately  50  per  cent 
as  compared  with  the  prewar  level.  In  the  same  period,  on  the 
other  hand,  the  price  of  denim,  tremendous  quantities  of  which  were 
used  by  the  Army  and  Navy,  rose  but  35  per  cent  as  compared  to 
the  average  level  of  1913-14,  while  standard  United  States  Army 
duck  sold  at  a  price  in  December,  1917,  which,  reduced  to  relative 
terms  on  a  prewar  base,  was  but  27  per  cent  higher  than  that  of  the 
preceding  July.1 

1  The  appended  tables  depict  the  price  situation  in  the  cotton  industry  during  1917. 
The  Government  prices  of  the  fabrics  used  in  quantities  by  the  United  States  Army  and 
Navy  remained  relatively  stable.  The  Army  price  of  hosiery  fell  quite  steadily  during 
the  last  five  months  of  1917,  while  the  market  price  for  the  consuming  public  continued 
to  rise,  and  cotton  denim  prices  paid  by  the  Government  were  at  all  times  lower  than 
the  market  prices  paid  by  the  general  public. 

UNIFORM  CLOTH,  OLIVE  DRAB,  USED  BY  ARMY. 
[Base  price,  $0.125  per  yard.] 


1917 

1918 

1917 

1918 

January     

$0.2911 

October 

$0  3154 

$0  3551 

February                        

.2878 

November 

3218 

3410 

March 

.2893 

December 

3074 

3010 

April                      

.2870 

Quarters: 

May 

.2882 

First 

2894 

June  

.3010 

Second   . 

2921 

July 

$0.3297 

.3114 

Third 

3216 

3272 

August 

.3230 

.3275 

Fourth 

3149 

3324 

September  

.3121 

.3426 

Year  

3182 

3103 

DUCK,  SHELTER  TENT. 
[Base  price,  $0.2033.] 


January      .            

$0.  2200 

$0.  3200 

October        .  .     . 

$0.3200 

$0  4150 

February 

.2550 

.3200 

November 

3200 

4150 

March 

.2550 

3200 

DeofiTnbfir 

3200 

4150 

April                    

.2700 

.3200 

Quarters: 

May 

.2850 

.3200 

First 

2433 

3200 

June     

.3450 

.3200 

Second  .  . 

3000 

3200 

July                          

.3450 

.3200 

Third.. 

.3450 

3517 

August 

.3450 

.3200 

Fourth 

3200 

4150 

September  

.3450 

.4150 

Year  

.3021 

3517 

GINGHAM,  26HNCH,  57  BY  50,  6.5  YARD. 

[Base  price,  $0.0609  per  yard.] 


1913 

1914 

1915 

1916 

1917 

1918 

January  

$0.0613 

$0.  0613 

$0.0588 

$0.0650 

$0.0838 

$0.  1561 

February        .                                 ... 

.0625 

.0613 

.0588 

.0700 

.0838 

.1713 

March 

.0625 

.0600 

.0588 

.0700 

.0875 

.1713 

April  

.0625 

.0600 

.0588 

.0750 

.0925 

.1713 

May  ... 

.0625 

.0600 

.0588 

.0750 

.0975 

.1713 

June  .  .  . 

.0625 

.0600 

.0588 

.0750 

.1025 

.1713 

July....                   

.0625 

.0600 

.0588 

.0750 

.1250 

.1713 

August 

.0625 

.0588 

.0588 

.0750 

.1250 

.1815 

September  

.0588 

.0588 

.0588 

.0750 

.1388 

.1900 

October. 

.0613 

.0588 

.0588 

.0750 

.1388 

.1900 

November 

.0613 

.0588 

.0625 

.0788 

.1438 

.1900 

December 

.0613 

0588 

.06g5 

.0838 

.1525 

.1900 

Quarters: 
First 

.0621 

.0609 

.0588 

.0683 

.0850 

.1662 

Second 

0625 

0600 

.0588 

.0750 

.0975 

.1713 

Third  

.0613 

.0592 

.0588 

.0750 

.1296 

.1809 

Fourth.. 

.0613 

.0588 

.0613 

.0792 

.1450 

.1900 

Year 

0618 

.0597 

.0594 

.0744 

.1143 

.1771 

296 


HISTORY   OF   PRICES   DURING   THE   WAR. 


The  "  fair  price  "  decision  of  the  cotton  goods  committee,  however, 
did  not  entirely  solve  even  the  price  problems  of  the  United  States 
Government.  Difficulty  was  being  experienced,  especially  by  the 
Navy,  in  securing  sufficient  supplies  at  reasonable  prices.  This  was 
especially  true  in  the  case  of  cotton  canvas,  where  it  was  becoming 
impossible  to  secure  favorable  bids.1 

Footnote  continued  from  p.  295. 

PRINT  CLOTHS,  39-INCH,  72  BY  76,  4.25  YARD. 
[Base  price,  $0.0648  per  yard.] 


1913 

1914 

1915 

1916 

1917 

1918 

January 

$0.  0650 

$0.  0675 

$0.  0500 

$0.0600 

$0.  0925 

$0.  1487 

February  

.0637 

.0669 

.0512 

.0612 

.0937 

.1550 

March 

.0625 

.0662 

.0500 

.0612 

.0937 

1837 

April  

.0600 

.0662 

.0531 

.0662 

.1000 

.  2150 

May 

.0575 

.0625 

.0562 

.0700 

.1050 

2100 

June                                          

.0594 

.0650 

.0525 

.0687 

.1225 

.2250 

July 

.0587 

.0625 

.0500 

.0687 

1325 

2250 

August  

-0587 

.0625 

.0506 

.0712 

.1275 

.2100 

September 

.0625 

.0550 

.0512 

.0800 

1250 

1987 

October.                                       

.0662 

.0512 

.0587 

.0875 

.  1325 

1987 

November 

.0700 

.0500 

.0575 

0962 

1400 

1987 

December. 

.0675 

.0500 

.0575 

.0975 

.1500 

1800 

Quarters: 

First 

.0637 

.0669 

.0504 

.0608 

.0933 

1625 

Second 

.0590 

.0646 

.0539 

0683 

1092 

°167 

Third 

.0600 

.0600 

.0506 

0733 

.1283 

.2112 

Fourth 

.0679 

.0504 

.0579 

.0937 

.1408 

.1925 

Year 

.0626 

.0605 

.0532 

0740 

1179 

1957 

DENIM  USED  BY  ARMY,  BLUE,  28-INCH,  8-OUNCE  TWILL  (3/1). 
[Base  price,  $0.1413  per  yard.] 


1917 

1918 

1917 

1918 

January 

$0  2954 

October 

$0  2858 

10  3292 

February..            

November  

.2875 

3327 

March 

.3500 

December 

2864 

3313 

April 

.3460 

Quarters: 

May... 

.3460 

First  

3231 

June 

.3389 

Second.   ..  

3423 

July 

3351 

Third 

2568 

3363 

August 

$0.  2363 

.  3316 

Fourth 

2866 

3323 

September  

.2772 

.3327 

Year  

.2746 

3339 

DUCK,  STANDARD  UNITED  STATES  ARMY,  FIRSTS,  28J-INCH,  8-OUNCE. 
[Base  price,  $0.1550  per  yard.] 


1917 

1918 

1917 

1918 

January                                           $0.  2000 

$0.  3425 

October 

$0.  3000 

SO  3350 

February                     .  2000 

.3425 

November  

.3425 

.3425 

March                                               .  2125 

.3425 

December 

.3425 

.3425 

April                           .  2500 

.3425 

Quarters: 

Mav                                                     .2500 

.3425 

'    First 

.2042 

.3425 

June                               .  2750 

.3425 

Second  .  . 

.2583 

.3425 

July                                                     .  3000 

.3350 

Third  ..     . 

3000 

3350 

August                .                .3000 

.3350 

Fourth  .. 

.3283 

.3400 

September                                        .  3000 

3350 

Year 

.2727 

.3400 

1  In  some  cases  it  was  impossible  to  get  any  bids  at 
Board,  Nov.  17,  1917. 


See  minutes  of  War  Industries 


GOVERNMENT   CONTROL   OVER   PRICES.  297 

Conditions  became  such,  in  fact,  that  the  Xavy  was  compelled  to 
call  upon  the  War  Industries  Board  for  aid,  and  suggested  that  the 
matter  of  fixing  a  price  for  canvas  be  given  consideration.1 

Accordingly,  the  canvas  situation  was  taken  in  hand  and  sales  of 
certain  constructions  were  restricted  to  the  Government.  In  taking 
oA7er  the  output  of  these  cloths  the  price  of  one  grade  was  reduced 
from  60J  cents  to  46J  cents  per  yard,  while  the  price  of  another 
which  had  remained  unchanged  during  the  summer  and  early  autumn 
was  increased  from  30  cents  to  34.25  cents  per  yard.  But  the  Gov- 
ernment consumption  of  cottons  kept  growing  by  leaps  and  bounds 
and  the  tremendous  demand  was  reflected  in  an  inflated  runaway 
market.  By  March,  1918,  fabric  values  reached  a  point  146  per  cent 
above  the  prewar  level  and  52  per  cent  above  the  current  level  of 
commodities  in  general.  It  was  soon  realized  by  Government  officials 
and  the  trade  that  the  situation  would  have  to  be  remedied.  K^tK^V^ 

The  price-fixing  committee  cmd  the  cotton  industry. — On  ffiay  26, 
1918,  seven  days  after  the  creation  of  the  price-fixing  committee,  the 
cotton  industry  met,  at  their  own  request,  with  the  price-fixing  com- 
mittee "for  the  purpose  of  discussing  the  unsatisfactory  condition 
of  the  cotton  textile  market."  The  problem  from  the  first  was 
exceedingly  complex.  Unlike  the  situation  in  the  iron  and  steel 
industry,  the  price  of  the  basic  raw  material  had  not  been  fixed.  It 
was  the  contention  of  the  textile  industry  that  the  price  of  raw 
cotton  would  have  to  be  fixed,  before  an  equitable  basis  for  regu- 
lating cotton-product  prices  could  be  inaugurated.  They  claimed 
that  the  market  price  of  raw  cotton  was  the  most  important  of  all 
the  factors  which  determined  the  price  of  their  product,  and  that 
with  an  uncontrolled  market  for  that  commodity  no  equitable  price 
for  cotton  textiles  could  be  established  for  any  extended  period  of 
time.  All  that  was  needed,  in  their  opinion,  was  the  fixing  of  raw- 
cotton  prices  and  the  fixing  of  a  differential  above  such  prices  for  ; 
the  various  types  of  products,  as  in  the  case  of  iron  and  steel.2 

The  price-fixing  committee,  however,  felt  that  raw-cotton  prices 
could  not  be  fixed.     They  believed,  on  the  contrary,  that  the  control 
of  finished  cloth  would  automatically  be  reflected  in  the  price  of  raw  j 
cotton.     This  question  of  raw  cotton  was  ever  present  throughout  j 
the  meetings  of  the  cotton  industry  with  the  price-fixing  committee, 
even  to  the  very  last.     In  fact,  it  was  largely  because  of  this  very 
difficulty  that  the  fixing  of  cotton-fabric  prices  was  delayed  until 
more  than  three  months  after  the  first  meeting  in  March.     It  should 
be  added  parenthetically  that  the  problem  of  securing  proper  cost 

1  Paymaster  McGowan.   in  a  letter  to  the   War   Industries   Board   in   November,   1917, 
stated  :  "  It  will  be  possible  to  control  the  industry  and  make  the  best  distribution   of 
Government  orders  if  the  prices  are  authoritatively  fixed." 

2  Minutes  of  price  fixing  committee,  May  26,  1918. 


298  HISTORY   OF   PRICES   DURING   THE   WAR. 

da.ta  which  could  be  used  in  determining  a  price  also  caused  some 
difficulty,  since  neither  the  price- fixing  committee  nor  the  industry 
had  information  sufficient  for  reaching  reliable  conclusions.  Dur- 
ing meetings  held  in  April  and  May  the  same  difficulties  were  dis- 
cussed *  with  no  apparent  result,  while  conditions  grew  rapidly  more 
acute.2 

The  -fixing  of  cotton  textile  prices. — Finally,  on  June  21,  1918,  an 
agreement,  based  on  the  joint  findings,  was  made  between  the  com- 
mittees representing  the  War  Industries  Board  and  the  trade, 
whereby  base  prices  were  fixed  on  four  different  classes  of  cotton 
goods,  effective  for  deliveries  after  July  1.  These  prices  were  to 
serve  as  a  general  basis  for  the  fixing  of  all  staple-cloth  prices,  and 
a  complete  schedule  for  all  fabrics,  based  on  a  margin  of  profits 
similar  to  that  allowed  on  the  four  fabrics  used  as  samples,  was  to 
follow.  A  30-cent  price  basis  for  raw  cotton  was  used  in  determin- 
ing these  prices,  and  Army  duck,  sheeting,  drills,  and  print  cloths 
were  used  as  standards.  Prices  agreed  upon  were  to  be  net  to  all 
customers,  both  civilian  and  Government. 

It  was  realized  that  the  prices  fixed  would  yield  a  liberal  profit 

for  the  better  equipped  and  organized  mills,  but,  after  all,  the  pur- 

i  poses  of  the  price  fixing  committee  were  attained.     The  cost  of  cotton 

1  The  basis  to  be  used  in  the  determination  of  return  upon  investment  was  a  factor 
which  made  the  settlement  of  cotton-goods  prices  no  simple  task.     The   attitude   of  the 
cotton  industry  in  this  connection  is  well  presented  ia  the  appended   resolution  passed 
by  two  of  the  leading  cotton  manufacturers'   associations   at  a  convention   held  May   3, 
1918  :   "  Resolved  further,  That  the  prosperity  of  industrial  America  is  essential  to  the 
financing  of  the  war;  and  that  any   plan   for   price  fixing  or   other   control   should   rest 
upon  the  basis  of  such  a  return  on  capital  invested  as  will  continue  to  yield  the  neces- 
sary taxes  and  to  provide  funds  for  the  purchase  of  the  bonds  required." 

2  It   appears   that   the    question    of   price   fixing    having   been    raised,    business    in    the 
various  lines  of  textiles  to  a  large  extent  halted,  and  inquiries  of  all  sorts  were  made 
as  to  how  both  old  and  new  contracts  were  to  be  executed.     It  finally  became  necessary, 
in  fact,  pending  the  actual  fixing  of  prices,  to  make  assurances  to  the  trade  as  to  the 
policies  to  be  followed  by  the  price  fixing  committee,  and  on  June  9  the  following  was 
announced  : 

"  In  order  to  establish  a  basis  for  a  prospective  price  agreement  *  *  *  the  fol- 
lowing tentative  plan  was  outlined  to  be  operative  if  the  pending  negotiations  for  a 
price  agreement  are  concluded : 

"On  all  bona  fide  sales  made  on  or  before  June  8,  1918,  for  delivery  previous  to  Jan. 
1.  1919,  prices  to  remain  as  shown  in  sales. 

"  On  all  sales  made  after  June  8,  1918,  for  delivery  subsequent  to  Sept.  30,  1918,  the 
prices  are  to  be  subject  to  revision  to  "accord  with  the'  prices  agreed  upon  by  the  price 
fixing  committee  of  the  War  Industries  Board  in  conference  with  the  war  service  com- 
mittee, etc. 

"  On  all  sales  made  for  delivery  after  Jan.  1,  1919,  the  prices  agreed  upon  *  *  * 
are  to  be  the  prices  regardless  of  the  fact  that  the  sales  may  have  been  made  previous 
to  June  8,  1918. 

"  It  is  understood  that  all  prices  for  so-called  spring  (1919)  business  will  be  subject 
to  such  revision. 

"  The  plan  contemplates  that  manufacturers'  prices  on  staples  shall  be  on  the  same 
basis  of  cost  and  profit  to  the  Government  and  to  their  usual  civilian  outlets.  It  is 
further  expected  that  manufacturers  will  agree  to  devote  a  uniformly  large  proportion 
of  their  productive  capacity  to  making  staples." 

The  last  statement  proved  of  considerable  concern  to  many  producers  in  later  months, 
and  many  manufacturers  refused  at  times  new  civilian  orders,  fearing  a  sudden  govern- 
mental demand.  (See  Textile  World  Journal,  Sept.  2,  1918,  p.  105.) 


GOVERNMENT   CONTROL   OVER   PRICES.  299 

textiles  to  the  Government,  to  be  sure,  was  increased  by  a  small  per- 
centage, but,  on  the  other  hand,  the  cost  to  the  civilian  population  was 
considerably  lowered.1 

The  question  was  raised,  to  be  sure,  as  to  the  practicability  of  a 
price  even  lower  than  that  fixed.  Indications  are,  however,  that  the 
cotton  trade  objected  to  too  drastic  a  cut  in  the  price  of  their  goods, 
not  only  because  of  their  own  interests  but  also  because  of  the  effect 
upon  the  distributors  of  their  products.  They  felt  that  since  cotton 
fabrics  go  through  several  hands  before  reaching  the  consumer,  a 
severe  cut  in  price  would  affect  the  inventory  of  the  holders  of  such 
stocks.  Moreover,  they  felt  that  a  price  which  was  set  too  low  would 
cut  the  production  of  many  of  the  fabrics  which  the  Government 
needed. 

It  should  be  borne  in  mind  that  the  prices  fixed  on  certain  cloths 
were  arrived  at  in  a  manner  different  from  that  which  characterized 
the  fixing  of  prices  for  other  commodities  up  to  that  time.  There 
was  a  decided  absence  of  cost  data.  Several  requests  had  been  made 
for  such  data,  but  the  representatives  of  the  industry  claimed  that 
the  time  required  for  their  collection  and  compilation  would  be  too 
long  to  make  them  available  for  immediate  use.  Moreover,  they 
believed  it  would  delay  the  starting  up  of  the  industry  which  had 
already  lagged  because  of  the  uncertainty  over  the  prices  to  be 
fixed.  There  was  wanted,  in  reality,  an  emergency  price  to  be 
changed  at  a  later  date,  and  this  the  agreed  price  was.  Indeed,  the 
price- fixing  committee  felt  it  necessary  publicly  to  state  that  its 
action  in  the  instance  of  cotton  products  was  "  not  in  accordance  with 
the  usual  procedure  "  and  that  it  was  not  to  be  expected  that  its 
negotiations  with  the  industry  would  be  continued  without  change. 
The  prices  fixed  were  later  to  be  revised  for  sales  made  during  the 
period  October  1  to  December  31,  or  for  such  other  period  as  might 
appear  desirable  at  the  time.2 

The  working  out  of  the  differentials  for  the  various  kinds  of 
fabrics  was  left  in  the  hands  of  a  committee  made  up  of  representa- 

*An  idea  of  the  effect  of  the  Government  fixed  price  is  gained  from  a  comparison  of 
the  old  and  new  prices  of  the  cloths  upon  which  prices  were  fixed.  The  market  price 
of  print  cloth  was  lowered  from  $1.03  to  $1.05  per  pound  to  $0.78  to  $0.85  per  pound. 
A  statement  in  the  Textile  World  on  June  29,  1918,  is  to  the  effect  that  the  price  of 
"  Fruit  of  the  Loom,"  a  popular  construction  of  print  cloths,  was  fixed  at  18£  cents  per 
yard,  while  the  lowest  price  quoted  prior  to  price  fixing  had  been  30  cents.  Puck 
prices — although  placed  a  little  above  the  level  at  which  the  Government  formerly  made 
its  purchases — were  made  15  to  25  cents  lower  per  pound  than  the  prevailing  civilian 
prices,  while  sheeting  and  drills  also  showed  marked  reductions. 

2  The  price-fixing  committee  had  a  small  amount  of  cost  data  which  it  had  secured 
independently.  Their  validity  at  many  points  was  denied  by  the  trade,  however.  These 
figures  showed  a  prewar  profit  for  the  cotton  industry  of  about  15  per  cent  as  against 
a  war  profit  of  25  to  30  per  cent.  Several  representatives  of  the  cotton  industry  justi- 
fied such  profits  on  the  basis  of  the  tax  situation.  (See  minutes  of  price-fixing  com- 
mittee, June  21,  1918.) 


300  HISTORY   OF   PRICES   DURING   THE   WAR, 

lives  of  the  trade,  the  Army  and  Navy,  and  the  War  Industries 
Board.  It  was  the  function  of  this  committee  to  submit  prices  for 
a  large  number  of  representative  fabrics  based  upon  a  return  on 
the  capital  investment  of  the  average  cotton  manufacturing  plant 
equal  to  that  allowed  for  the  four  types  of  cloth  which  had  been 
selected  as  the  basic  staples.1  The  idea  was  to  compile  a  list  of 
fabric  prices  so  thoroughly  representative  that  it  would  be  com- 
paratively simple  for  the  industry  itself  to  fix  prices  of  cloths  vary- 
ing slightly  in  construction  in  harmony  with  the  published  prices. 

Criticism  of  prices  to  be  fixed  in  this  way  was,  of  course,  bound 
to  occur  in  many  instances.  A  committee  of  textile  experts  was 
therefore  appointed  to  act  as  arbiters  in  those  cases  where  objection 
was  raised  against  the  prices  at  which  the  variants  from  standards 
were  being  sold,  and  the  price  agreed  upon  between  this  committee 
and  the  trade  was  to  be  made  officially  one  of  the  fixed  prices.  The 
price-fixing  committee,  however,  remained  the  court  of  last  resort, 
and  in  this  body  lay  the  right  to  make  a  final  decision  whenever  the 
trade  and  the  committee  of  experts  failed  in  reaching  an  agreement. 

The  prices  agreed  upon  affected  only  the  sales  by  the  various  mills 
manufacturing  cotton  products.  Xo  attempt  was  made  to  fix  the 
price  of  the  middleman  or  retailer,  since  the  price-fixing  committee 
trusted  that  those  members  of  the  trade  would  see  to  it  that  their 
prices  were  regulated  in  accordance  with  the  prices  of  the  producers.2 

At  later  meetings  with  the  price-fixing  committee,  the  cotton  manu- 
facturers protested  as  unfair  the  lax  manner  by  which  price  fixing 
was  extended  over  the  various  middlemen  and  distributors.  They 
suggested  the  licensing  of  brokers  and  middlemen,  but  were  told  that 
the  price-fixing  committee  had  no  authority  for  such  action. 

The  policy  of  the  price-fixing  committee  appears  to  have  been  con- 
sistently to  deal  only  with  the  manufacturers  themselves.  Even  early 
in  September,  when  the  wholesale  dry  goods  trade  wanted  to  fix  a 
maximum  price  for  the  distribution  of  cotton  fabrics,  they  were  told 
that  the  matter  would  be  left  to  their  own  care.  The  Cotton  Con- 

1  The  price-fixing  committee  from  time  to  time  approved  prices  on  cotton  products  as 
determined   by   a   committee   of   the   trade    and    the    textile   experts.      Announcements    of 
agreed  prices  were  made  July  1,  25  ;  Aug.  7,  9,  14,  16,  22,  30 ;  Sept.  3,  5,  25  ;  Oct.  17, 
28  ;  Nov.  4,  8,  and  9,  respectively. 

2  It  was  felt  that  the  request  of  the  President  that  the  distributors  of  cotton  goods, 
namely,  manufacturers  of  ready-to-wear  clothes,  as  well  as  all  dealers  in  cotton  fabrics, 
regulate   their   profits   so   as   to   give  the   consumer   the   full   benefit   of   the   reduction   in 
price  (see  price-fixing  committee's  announcement  to  the  press,  July  8)   would  result  in  a 
lowered   price  all  along  the  line  to   the  ultimate   consumer.     Whether   such   was   really 
the    case    appears    doubtful.      To    wit,    the    following   extract    from    an    editorial    in   the 
Textile  World  Journal  of  June  29,  1918  :  "  Price  fixing  on  cotton  goods  for  the  benefit 
of  the  trade  and  the  protection  of  the  ultimate  consumer  goes  a   long  way,   but   unless 
the  retailer,  too,  is  curbed,  it  will   still  fall  short.     In  a  Fifth  Avenue  store  $1.15   was 
charged  for  a  gingham  that  was  sold  elsewhere  on  the  avenue  for  $0.50.     Shortly  after 
this    comparison    was    made   the    first   store    marked    its    goods    as    a   bargain    at   $0.75, 
reduced  from  $1.15." 


GOVERNMENT   CONTROL   OVER   PRICES.  301 

verters1  Association,  indeed,  limited  the  profit  to  be  realized  from 
converting  those  fabrics  on  which  prices  had  been  fixed  by  the  Gov- 
ernment, but  this  action  was  quite  of  their  own  volition  and  without 
reference  to  any  activities  of  the  price-fixing  committee. 

Cotton  yam  prices. — Among  the  many  cotton  products,  the  price 
of  which  was  to  be  fixed  by  the  above-mentioned  committee  of  the 
trade  and  the  War  Industries  Board,  appointed  for  the  determining 
of  equitable  prices,  was  cotton  yarn.  On  August  14,  a  set  of  differ- 
entials based  on  the  prices  fixed  on  June  21  was  announced  to  the 
trade.  The  prices  determined  were  based  upon  the  length  of  the 
cotton  staple  used  in  specific  yarns,  thereby  making  the  price  depend 
entirely  on  the  character  of  the  cotton  employed.  Such  a  policy 
appears  to  have  been  contrary  to  the  general  practices  of  the  trade, 
since  cotton  yarns  are  usually  sold  indirectly  through  commission 
houses.  Sellers  usually  have  little  intimate  knowledge  either  of  the 
grade  or  the  length  of  the  cotton  employed  in  spinning.  It  is  with 
the  spinners  that  this  information  generally  lies.  Moreover,  the 
cotton  spinners,  whose  profits  are  the  first  to  be  affected  by  a  change 
in  raw  cotton  prices,  were  experiencing  the  results  of  a  rising  raw- 
cotton  price.  The  situation  appears  to  have  caused  considerable  con- 
sternation in  the  spinning  branch  of  the  cotton  industry,  and  for 
many  weeks  the  business  is  said  to  have  been  completely  halted.1 

The  proposed  price  revision. — As  October  1  approached,  the 
question  of  revising  cotton-goods  prices  arose,  and  the  cotton  trade 
began  meeting  once  more  with  the  price-fixing  committee.  But  again 
the  identical  problems  of  the  preceding  June  presented  themselves. 
Thus,  in  early  September  little  was  accomplished  toward  price  re- 
vision, because  the  same  lack  of  cost  information  held  up  negotia- 
tions. Indeed,  "  the  failure  of  a  large  number  of  cotton  mills  to 
submit  their  cost  sheets"  resulted  in  the  postponing  of  any  revision 
until  November  16.2  The  question  of  fixing  raw-cotton  prices  arose, 
as  in  former  days,  of  course,  and  played  its  part  in  occasioning  the 
delay  of  a  revision.  Talk  of  governmental  price  fixing  was  rife  at 
the  time,  and  a  committee  had  already  been  appointed  to  look  into 

!The  Textile  World,  in  an  editorial,  of  Aug.  17,  1918,  summed  up  the  situation  as 
follows  : 

"  The  more  the  program  of  price  fixing  is  developed  in  the  textile  trade  the  greater 
seem  to  be  the  confusion  and  uncertainty  that  arise.  The  latest  instance  of  this 
character  is  the  announcement  from  Washington  concerning  regulated  prices  on  cotton 
yarns  *  *  *.  The  yarn-selling  market  is  in  a  state  of  chaos  and  unable  to  deter- 
mine how  to  proceed." 

Later,  on  Sept.  7,  this  same  paper  stated  that — 

"  The  cotton-yarn  trade  is  still  worrying  along  in  a  period  of  adjustment  to  the 
•new  conditions  laid  down  by  the  price  regulations.  *  *  *  " 

Relative  to  the  price  of  raw  cotton,  it  said  : 

"  The  recent  sharp  advances  in  cotton  prices  have  again  emphasized  the  fallacy  of 
the  effort  to  fix  yarn  prices  as  long  as  the  raw  material  remains  unchecked." 

2  See  public  announcement  of  price-fixing  committee,  Sept.  26,   1918. 


302  HISTORY  OF   PRICES   DURING  THE   WAR. 

the  matter ;  and  it  was  thought  advisable  to  await  the  results  of  their 
investigation  before  making  a  final  decision  regarding  cotton-goods 
prices. 

The  Federal  Trade  Commission  at  last  succeeded  in  getting  a  suffi- 
cient number  of  firms  to  submit  data  on  production  costs  to  warrant 
further  action  by  the  price-fixing  committee,  and  on  November  8, 
accordingly,  the  representatives  of  the  trade  were  called  in  for 
further  consultation.  The  cost  records  evidently  convinced  the 
price-fixing  committee  that  the  prices  of  cotton  goods,  even  as  fixed 
under  the  July  arrangement,  were  too  high,1  and  it  was  their  opinion 
that  a  lower  price,  especially  on  denims  and  several  other  types  of 
cloth,  should  be  inaugurated  for  the  period  to  follow  November  16. 

1  The  price-fixing  committee  contended  that  in  order  to  place  other  fabrics  on  a  parity 
with  cotton  sheeting,  which  was  used  as  the  basis  for  price  determination,  prices  should 
be  fixed  so  as  to  allow  a  25  per  cent  return  on  plant  investment.  This  profit  was  being 
exceeded  in  their  opinion,  and  as  proof  of  this  fact  they  submitted  the  following  figures 
(minutes  of  price-fixing  committee,  Nov.  8,  1918)  : 

THREE-YARD     SHEETING     COSTS. 

Investment  cost : 

Fixed  cost  per  spindle $37 

Working  capital  required e 13 

Total  investment 50 

Per  pound 
Conversion  cost  :  of  sheeting. 

Raw  cotton  used  in  sheeting -   $0.  38 

Cost  of  spinning  and  weaving .  095 

Twenty  per  cent  additional  labor  cost  allowed .  020 

Selling  cost .025 

Total  conversion  cost .  52 

Price  fixed  f.  o.  b.  mill,  $0.60  per  pound,  leaving  a  profit  of  $0.08  per  pound.  The 
average  spindle  consumes  150  pounds  of  cotton  per  year,  and,  on  a  basis  of  $0.08  profit 
per  pound,  there  results  a  yearly  profit  of  $12  or  25  pea*  cent  on  the  capital  investment 
per  spindle. 

DKXIM   COSTS. 

Investment  cost : 

Fixed  cost  per  spindle $55 

Working  capital  required 20 

Total  investment 75 

Per  pound 
Conversion  cost :  of  denim. 

Raw  cotton  (allowing  for  10  per  cent  shrinkage"  at  $0.32  per  pound $0.  36 

Cost  of  spinning  and  weaving .  17 

Twenty  per  cent  additional  labor  cost  allowed .  035 

Selling  cost .  025 


Total  conversion  cost .  59 

To  place  denim  on  a  parity  with  3-yard  sheeting,  i.  e.,  the  realization  of  a  25  per  cent 
return  on  investment,  with  an  estimated  consumption  of  250  pounds  of  cotton  per  spindle 
per  year,  $0.08  per  pound  should  be  added  to  the  ascertained  cost  of  production.  This 
would  net  a  return  of  $20  per  spindle  per  year,  or  a  return  of  approximately  26  per 
cent  on  a  spindle  investment  of  $75,  and  would  make  the  selling  price  of  denim  $0.67 
per  pound.  The  then  existing  price,  however,  was  $0.80. 

The  validity  of  these  data  was  denied  by  several  members  of  the  trade,  principally 
because  of  the  omission  of  any  allowance  for  investment  in  buildings,  and  the  divergency 
in  costs  in  southern  mills  as  compared  with  northern  mills. 


GOVERNMENT   CONTROL   OVER  PRICES.  303 

The  price  of  raw  cotton,  incidentally,  had  not  yet  been  fixed,  and 
ostensibly  fearing  a  rise  in  price,  the  cotton  trade  objected  to  any 
decrease  in  the  prevailing  schedule  of  prices.  In  fact,  they  went  to 
the  extent  of  suggesting  that  the  prices  then  in  force  be  continued 
until  January  1.  And,  in  spite  of  opinion  to  the  contrary,  especially 
on  the  part  of  several  members,  this  suggestion  of  the  cotton  trade 
was  put  into  practical  operation.  The  prices  in  force  on  November 
8  were  continued  until  January  1,  1919,  but  not  without  considerable 
reservation.  Indeed,  for  the  first  time  the  price-fixing  ^committee 
emphasized  in  a  public  statement  that  the  prices  in  force  were  maxima 
and  that  both  the  Government  and  the  public  were  allowed  to  pur- 
chase as  much  below  these  prices  as  possible.  Further,  the  price- 
fixing  committee  went  so  far  as  to  disclaim  responsibility  for  their 
fairness. 

Then  came  the  armistice  with  its  wake  of  cancellations  and  the 
general  disorganization  of  the  cotton  industry  and  the  question  as 
to  the  advisability  of  discontinuing  price  control.  The  cessation  of 
control  appears  to  have  been  advocated  by  many,  both  within  and 
without  governmental  circles,  but  the  preponderance  of  opinion  lay 
in  the  direction  of  its  continuance.  There  was,  for  example,  the 
question  of  the  behavior  of  the  market  with  the  opening  of  the 
international  trade  routes,  especially  in  view  of  the  foreign  demand 
for  raw  cotton,  the  export  of  which  had  been  held  in  check  for  almost 
a  year.  Moreover,  the  possibility  of  complications  over  contracts 
made  under  the  maximum  price  agreement  was  another  deterrent, 
and  the  fixed  price  agreement  continued  until  January  1,  when  it 
automatically  ceased  by  limitation. 

Summary. — The  extraordinary  inflation  resulting  because  of  the 
taking  from  the  market  by  the  War  Department,  and  the  Navy,  of 
the  major  portion  of  available  cotton  textiles,  threw  the 'cotton  indus- 
try virtually  into  disorganization  by  the  spring  and  early  summer 
of  1918.  The  market  had  become  dangerously  inflated,  to  the  extent, 
indeed  that  the  Government  was  compelled  to  commandeer  prac- 
tically all  its  textile  supplies  in  order  that  it  might  secure  them  at 
fair  prices.  The  consequent  result,  of  course,  was  the  unwillingness 
of  the  industry  to  sell  to  the  Government,  and  in  early  summer 
price  fixing  was  inaugurated. 

The  absence  of  cost  data,  and  the  question  of  raw-cotton  prices, 
were  considerable  factors  which  made  difficult  an  equitable  method  of 
price  fixing,  and  even  at  the  very  end  of  the  period  of  price  agree- 
ments, there  remained  obstacles  of  considerable  moment. 

Whether  the  results  attained  were  as  beneficial  as  they  might  have 
been  under  a  system  of  strict  limitation  of  profits  to  the  prewar 
level,  it  is  not  with  the  scope  of  this  study  to  determine.  The 


304 


HISTORY   OF   PRICES   DURING   THE   WAR, 


prices  of  cotton  manufactures,  in  spite  of  price  fixing,  remained 
at  points  varying  from  64  to  87  per  cent  above  the  level  of  com- 
modities in  general  during  the  latter  half  of  1918,  while  raw  cotton, 
which  was  uncontrolled,  advanced  at  no  time  during  this  period 
more  than  61  per  cent  above  the  general  price  level.  That  the  price 
situation  was  considerably  alleviated  by  the  fixing  of  cotton  prod- 
ucts prices,  however,  can  not  be 
denied,  and  not  only  did  the 
price  of  several  individual  types 
of  fabrics  decrease,  but,  as  evi- 
denced by  the  accompanying 
chart,  the  price  level  for  the 
entire  group  of  cotton  manu- 
factures fell  appreciably. 

COTTON  LINTERS. 

Even  in  November,  1916,  five 
months  before  the  United  States 
declared  war,  the  price  of  cot- 
ton linters  had  reached  insecure 
heights.  The  allied  demands 
for  explosives  were  fast  taking 
the  available  supply  and  the 
year  1916  closed  with  the  price 
of  munition  linters  at  7.75  cents 
per  pound,  or  278  per  cent  above 
its  prewar  level  of  2.5  cents.1 
With  the  American  entrance 
into  the  war,  the  acuteness  of 
the  situation  was  considerably 
emphasized. 

The  requirements  for  muni- 
tions purposes  increased  the  de- 
mand for  linters  to  a  very  con- 
siderable degree,  and  ways  were  sought  for  increasing  production 
to  an  extent  commensurate  with  this  demand.  One  means  of  enlarg- 
ing the  output  was  the  closer  cutting  at  the  oil  mills,  thereby  taking 
n  larger  proportion  of  the  linters  from  the  seed.  This,  of  course, 
lessened  the  quality  of  the  linters,  but  the  low  grades  were  found 
just  as  satisfactory  for  munition  making  as  the  higher. 

The  oil  mills  then,  in  1915,  began  to  cut  the  cotton  seed  much 
closer  than  had  been  customary,  and  increased  the  output  of  linters 

1  See  "  Prices  of  Cotton  and  Cotton  Products,"  by  James  H.  Rogers  (War  Industries 
Board  Price  Bulletin  No.  23),  for  a  complete  series  of  cotton  linter  prices  from  January, 
1913,  to  December,  1918. 


SHORT  5TAPLL  COTTON 

......  UPLAND  MIDDLING- RY. 

3HQRT  STAPLE  COTTON 

AVERAGE:  or 


Weighted  index  number  of  wholesale 
prices. — Short  staple  cotton,  upland 
middling,  New  York  ;  Short  staple  cotton 
yarns,  average  of  five  series  ;  Short  staple 
cotton  manufactures  (except  yarns), 
average  of  19  series. — By  months,  Janu- 
ary, 1913,  to  December,  1918.  (Average 
quoted  prices,  July,  1913,  to  June, 
1914=100.) 


GOVERNMENT   CONTROL   OVER   PRICES. 


305 


per  ton  of  cotton  for  the  year  1915-16  approximately  50  per  cent 
above  that  of  the  preceding  year.1  The  increased  output  per  ton 
of  cotton  was  reflected  in  the  available  supply  of  cotton  linters  and 
the  crop  year  1916-17  witnessed  a  production  of  1.331,000  bales, 
which  meant  a  100  per  cent  growth  in  output  when  compared  with 
the  year  immediately  preceding  the  outbreak  of  the  World  War.2 

Even  this  extraordinary  increase  in  the  available  supply,  how- 
ever, neither  stabilized  the  price  level  of  cotton  linters  nor  met  the 
ever-growing  needs  for  munitions  purposes.  Thus,  in  the  crop  year 
1915-16,  despite  the  fact  that  the  quality  of  our  1  inter  output  had 
been  reduced  by  increasing  the  quantity  cut  from  the  seed  to  106 
pounds  per  ton  of  cotton,  as  contrasted  with  71  pounds  in  the  pre- 
ceding year,  the  average  price  rose  to  5.9  cents  per  pound  as  against 
1.9  cents  per  pounds  for  the  crop  year  1914-15.  In  1916-17,  with  a 
li  nter  cut  increased  to  149  pounds,  the  average  price  increased  to 
6.8  cents.3 

lrrhe  effect  of  close  cutting  upon  the  output  of  linters  per  ton  of  cotton  is  made  more 
evident  from  the  following  table  taken  from  bulletin  on  "  Cotton  a'nd  Cotton  Products." 


Year. 

Average 
pounds  of 
linters  cut 
per  ton  . 

1912-13 

64 

1913-14  

68 

1914-15                   

71 

1915-16 

106 

1910-17      

149 

1917-18 

133 

2  In  the  appended  table  are  given  the  figures  for  the  production  of  cotton  linters  from  1912  to  1918  as  com- 
piled by  the  United  States  Bureau  of  Census.  The  effect  of  close  cutting,  especially  upon  the  supply  of 
cotton  linters  available  for  munitions,  is  most  significant. 

Production  of  cotton  linters  in  the  United  States. 


Crop  years. 

Bales  of 
500  pounds. 

1912-13 

610  000 

1913-14  

639,000 

1914-15                  

857,000 

1915-16 

931  000 

1916-17  

1,331,000 

1917-18 

1  126,000 

'The  price  of  linters  from  1912  to  1917  as  presented  in  Bulletin  30.  follows: 


Crop  years. 

Weighted 
average 
price  per 
pound. 

1912-13                           --  - 

Cents. 
2.6 

1913-14 

2.3 

1914-15             

1.5 

1915-16 

5.9 

1916-17 

6.8 

125547°— 20 20 


306  HISTORY   OF   PRICES   DURING   THE   WAR. 

The  entrance  of  die  United  States  into  the  war  witnessed  a  short- 
age of  cotton  linters,  in  spite  of  the  doubling  of  our  production  in 
five  years.  Indeed,  the  first  duty  which  faced  the  cotton  and  cotton 
linters  section  of  the  War  Industries  Board  which  was  organized 
on  April  4,  1918,  was  the  investigation  of  the  cotton-linter  situation 
and  the  determination  of  the  seriousness  of  the  cotton-linter  shortage. 

Accordingly,  the  entire  field  of  cotton  linter  production  was  sur- 
veyed, and  the  prospects  of  an  acute  shortage  of  supplies  made  clear. 
The  investigation  indicated  that  the  average  annual  production  of 
linters  in  the  five  years  preceding  1918  was  less  than  one-half  of  the 
prospective  requirements  for  1919.1  While  there  was  no  shortage 
of  linters  at  the  moment,  the  approach  of  a  shortage  seemed  inevit- 
able since  the  Government  was  at  the  point  of  completing  a  num- 
ber of  new  powder  plants  which  would  soon  double  the  linter  re- 
quirements. Moreover,  it  was  found  that  there  were  being  produced 
some  10  to  12  grades  of  linters,  and  that  a  large  part  of  our  output 
was  going  into  the  manufacture  of  mattresses,  felts,  etc. 

Government  control  of  the  linter  crop. — The  immediate  need,  then, 
was  the  stimulation  of  linter  output,  and  with  this  in  view,  cotton- 
seed crushers  were  required  to  increase  the  cut  of  linters.  After 
May  2,  1918,  at  the  order  of  the  War  Industries  Board  the  oil  mills 
were  required  to  "  cut  clean  mill  run  linters  known  as  munition  type  " 
exclusively.  Moreover,  crushers  were  compelled  to  cut  a  minimum  of 
145  pounds  of  linters  per  ton  of  seed  crushed.  And  for  the  period 
May  2,  1918,  to  July  31,  1919,  these  linters  were  to  be  sold  to  no  one 
other  than  the  United  States  Government,  which  agreed  to  take  over 
the  supply  produced  from  the  1918-19  crop  at  a  price  of  $4.67  per 
hundredweight  f .  o.  b.  points  of  production.2 

This,  of  course,  meant  that  the  many  industries  which  normally 
used  cotton  linters  would  be  deprived  of  their  supply.  But  it 
appears  that  they  underwent  no  hardship,  for  the  War  Industries 
Board  had  thoroughly  surveyed  the  situation  and  had  found  ^that 
there  was  available  a  sufficiently  large  supply  of  cotton  mill  waste, 
hull  fiber,  and  wood  pulp  which  could  well  be  used  as  a  substitute 
for  cotton  linters  in  the  normal  linter-consuming  plant. 

The  cotton  linter  pool. — When  the  supply  of  cotton  linters  had 
been  brought  under  control  and  the  price  stabilized,  there  still  re- 

1  Final  report  of  cotton  and  cotton  linters  section,  War  Industries  Board,  1918. 

2  This  price,  0.058  cents  lower  than  the  price  of  August,  1917,  the  last  month  far  which 
authoritative  price  quotations  can  be  secured,  was  ratified  by  the  price  fixing  committee 
and  made  effective  May  2,  1918. 

Several  months  -later,  on  July  8,  1918,  the  price  fixing  committee  set  a  maximum 
price  of  $6.33  per  hundredweight  for  the  bleaching  of  linters.  This  price,  however,  in 
view  of  the  large  bleaching  capacity  of  the  country  and  the  ever-present  competition, 
appears  never  to  have  been  effective.  Indeed,  it  is  believed  that  contract  prices  were 
appreciably  lower  than  the  maximum  allowed.  The  fixed  price  expired  by  limitation  on 
Oct.  31,  1918. 


GOVERNMENT   CONTROL  OVER  PRICES.  307 

mained  the  problem  of  its  distribution.  There  was  not  only  the 
need  of  linters  for  our  own  consumption,  but  also  the  constant 
demands  of  the  allied  governments  which  were  largely  dependent 
upon  us.  An  organization  made  up  of  representatives  of  the  Allied 
Governments  to  supervise  distribution  was  therefore  created,  and 
"  The  Cotton  Linter  Pool  "  came  into  being.1 

This  body,  the  guiding  spirit  of  which  was  the  Ordnance  Depart- 
ment of  the  United  States  Army,  provided  for  the  securing  of  linters 
at  uniform  prices  for  the  various  members  and  had  as  its  purchasing 
agent  the  Du  Pont  American  Industries  (Inc.),  to  whom  was  allowed 
26  cents  for  each  bale  of  linters  purchased  for  the  "  Pool." 2  It  appears 
that  ample  supplies  of  linters  were  obtained  during  the  summer  and 
autumn  of  1918.  With  the  signing  of  the  armistice,  however,  the 
Government  needs  automatically  ceased.  But  there  still  remained 
the  obligation  of  continuing  the  purchase  of  linters.  The  fulfill- 
ment of  this  responsibility  was  placed  in  the  hands  of  the  Ordnance 
Department. 

Restrictions  as  to  the  cutting  of  linters  were  no  longer  necessary, 
and  crushers  were  not  required  to  cut  the  minimum  of  145  pounds  of 
linters  per  ton  of  seed  as  had  been  decreed  on  May  2.  Crushers  im- 
mediately began,  therefore,  to  resume  cutting  the  longer  linters 
which  could  be  used  in  the  manufacture  of  mattresses  and  like  com- 
modities, and  for  which  they  could  secure  a  higher  return. 

Among  the  tasks  facing  the  Ordnance  Department  was  the  dispo- 
sition of  linters  on  hand  which  had  cost  approximately  $20,000,000, 
and  attempts  to  dispose  of  this  surplus  resulted  in  the  War  Depart- 
ment receiving  bids  for  small  quantities  for  which  a  price  averag- 
ing less  than  2  cents  per  pound  was  offered.  Finally,  on  May  24, 
1919,  the  War  Department  announced  the  sale  of  700,000  bales  of 
cotton  linters  for  approximately  $15,000,000,  one  of  the  largest  single 
transactions  in  cotton  fiber  ever  consummated  in  the  history  of  the 
cotton  industry. 

iAmong  the  participants  in  this  pool  were  the  United  States  Government,  represented  by 
the  Ordnance  Department  of  the  Army,  the  Canadian,  French,  British,  Italian,  and  Belgian 
Governments,  manufacturers  of  explosives  having  United  States  or  Allied  Government 
contracts  for  powder  or  guncotton,  and  "  manufacturers  of  absorbent  cotton  or  other  sup- 
plies, using  cotton  linters,  having  United  States  or  Allied  Government  or  Red  Cross 
contracts." 

2  The  final  report  of  the  cotton,  and  cotton  linters  section  of  the  War  Industries  Board 
enumerates  in  part  the  functions  of  the  linter  pool  and  the  system  of  division  of  powers, 
as  follows  : 

The  United  States  Ordnance  Department  had  jurisdiction  over  (1)  the  production  and 
stimulation  of  linter  production;  (2)  requisitioning  or  commandeering  stocks;  (3)  all 
financing,  either  as  to  production  or  purchases  ;  and  (4)  disputes  arising  between  pur- 
chasing agency  and  producers. 

The  cotton  and  cotton  linters  section  of  the  War  Industries  Board  had  jurisdiction  ovet 
(1)  allocations  of  supply;  (2)  storaging  and  warehousing;  (3)  rules  pertaining  to  linter 
manufacture;  and  (4)  reports  and  records  of  stocks,  production,  requirements,  etc. 

The  expenses  of  the  pool  were  prorated  among  the  members. 


308  HISTORY  OF  PRICES   DURING  THE   WAR. 

The  mattress  linter  pool. — Although  virtually  the  entire  supply 
of  linters  went  into  the  manufacture  of  explosives,  there  apparently 
remained  an  appreciable  governmental  and  Red  Cross  demand  for 
linters  for  mattresses  for  hospital  uses.  The  production  of  linters 
for  such  purposes  had  been  prohibited  on  May  2,  1918,  but  there 
still  remained  a  supply  of  mattress  linters  which  had  been  produced 
prior  to  that  date.  In  order  to  meet  the  war  demands  for  these 
linters,  therefore,  the  "  Mattress  Linter  Pool "  was  formed  and  as  in 
the  case  of  munition  linters,  the  Du  Pont  American  Industries 
(Inc.),  was  appointed  purchasing  agent  "with  instructions  to  buy 
all  mattress  linters  available  from  production  prior  to  May  2,  1918."  * 
Pains  were  taken  to  insure  the  obtaining  of  the  greatest  supply  pos- 
sible, and  regulations  were  drawn  up  which  prohibited  "  the  use  or 
sale  of  mattress  linters  by  or  to  any  individual,  firm,  or  organization, 
other  than  the  Mattress  Linter  Pool."  This,  of  course,  made  such 
supplies  as  were  existent  of  little  or  no  immediate  value  to  the 
holders  thereof  and  naturally  the  result  was  a  desire  to  sell  to  the 
only  permissible  customer.  Provisions,  however,  were  necessary  as 
to  the  price  of  linters  under  this  arrangement.  Accordingly,  a  basic 
price  on  three  sample  types  of  linters  was  determined  by  agreement 
and  the  Du  Pont  Co.  was  instructed  to  buy  at  the  figure  fixed  for  all 
supplies  voluntarily  offered.2 

It  is  estimated  that  about  75  per  cent  of  the  mattress  linters  in 
existence  were  purchased  by  the  Mattress  Pool.3 

On  the  day  following:  the  signing  of  the  armistice  all  restrictions, 
relative  to  the  use  of  mattress  linters  were  removed.  It  was  neces- 
sary, however,  to  give  the  industry  an  opportunity  to  get  its  breath 
after  so  sudden  a  change,  and  provision  was  made  to  continue  the 
buying  of  mattress  linters  until  November  23,  from  anybody  who 
wished  to  sell.4  An  arrangement  was  also  made  whereby  those 
mattress  manufacturers  who  had  voluntarily  sold  their  linters  at  the 
agreed  prices  might  buy  back  at  the  same  figure  the  supplies  turned 
over  to  the  Government. 

1  Report  of  cotton  and   cotton   linters  section,  ibid. 

2  Three  grades  of  linters,  designated  as  "  A,"  "  B,"  and  "  C,"  were  used  as  samples  and 
a  figure  of  10  cents,  7  cents,  and  5.5  cents  f.  o.  b.  points  of  location,  respectively,   was 
agreed  upon  as  the  price  to  be  paid.     All  linters  below  grade  "  C  "  were  to  be  considered 
munition  linters  and  were  to  sell  at  $4.67  per  hundredweight  (see  p.  703). 

3  Report  of  cotton  and  cotton  linters  section,  ibid. 

There  were  many  holders  of  mattress  linters  who  were  unwilling  to  sell  their  supplies 
at  the  agreed  prices,  and  in  such  cases  the  Ordnance  Department  was  to  exercise  its  com- 
mandeering powers.  This  method  of  securing  supplies  gave  the  owner  opportunity  to 
establish  the  actual  value  of  the  commodity. 

*  Later  the  Ordnance  Department,  in  order  to  protect  the  producers  of  mattress  linters, 
agreed  to  take  over  any  surplus  of  mattress  linters  up  to  150,000  bales  which  might  be 
on  hand  on  July  1,  1919,  at  a  price  of  8  cents,  7.5  cents,  and  5  cents  for  the  three  grades 
"  A,"  "  B,"  and  "  C,"  respectively, 


GOVERNMENT   CONTROL   OVER   PRICES. 


309 


A  glance  at  the  accompanying  chart  will  give  an  idea  of  the  sta- 
bilizing effects  of  governmental  action  upon  the  price  of  cotton  lin- 
ters. Its  price  level  appears  to  be  subject  to  violent  fluctuations  even 
in  peace  times  and  at  no  time  during  the  entire  six-year  period,  1913 
to  1918.  did  munition  linter 
prices  remain  unchanged  for 
more  than  a  fewr  months  at  a 
time.  Moreover,  so  far  as 
available  statistics  show,  dur- 
ing no  month  from  September, 
1915,  to  May,  1918— the  month 
of  governmental  price  fixing — 
was  the  price  of  linters  as  low 
as  that  fixed  by  the  War  Indus- 
tries Board. 

WOOL. 

The  large  consumption  of 
wool  in  the  United  States  has 
made  it  necessary  for  the 
American  woolen  industry  to 
be  at  all  times  dependent  in 
large  part  upon  foreign  im- 
ports. Indeed,  the  propor- 
tion of  domestic  wool  which 
in  the  prewar  years  went  into 
the  manufacture  of  woolens 
and  worsteds  never  amounted 
to  more  than  two-thirds  of  our 
total  consumption,  while  in 
many  instances  it  comprised 
slightly  more  than  one-half. 
With  the  stimulation  of  the 
industry  in  1915,  brought 
about  by  the  allied  demand  for 
woolen  products,  the  propor- 
tion of  our  total  consumption 
supplied  by  domestic  raw  wools 
fell  off  until,  before  the  year 
ended,  our  imports  played  a  more  important  part  in  our  woolen 
industry  than  did  the  home  clip.  The  foreign  wools  used  in  the 
United  States  in  1916  amounted  to  534,828.022  pounds  as  against 
288.490,000  pounds  of  domestic  wools— a  ratio  of  2  to  1. 


RELATIVE  PRICES  OF 

COTTON  LINTCR2 

KADC  n,CUTUO-174LBJPER' 


Relative  prices. — Cotton  linters,  grade  D, 
cut  130 — 175  pounds  per  ton. — By  months, 
January,  1913,  to  December,  1918.  (Aver- 
age quoted  prices,  July,  1913,  to  June, 
1914=100.) 


310  HISTORY   OF   PRICES   DURING   THE   WAR. 

The  acute  shipping  situation  of  1917  and  the  shutting  off  of  sup- 
plies from  Australia,1  which  had  been  our  most  important  source  of 
raw  wool  in  the  two  preceding  years,  cut  the  imports  for  1917  down 
to  a  little  more  than  372,000,000  pounds.  The  consumption  for  the 
year  likewise  fell,  and  the  industry  in  1917  used  164,000,000  pounds 
less  wool  than  in  1916.  But  the  large  requirements  of  the  Army  soon 
increased  the  demand  again,  and  the  first  half  of  1918  witnessed  a 
consumption  equal  to  two-thirds  of  that  of  the  previous  year,  and 
almost  as  large  as  the  total  for  the  year  preceding  the  outbreak  of 
the  European  War.  Although  the  imports  were  fairly  large  during 
the  first  six  months  of  1918,  they  were  not  commensurate  with  the 
demands.  The  result,  then,  was  a  decrease  in  stocks  which  on  June 
30,  1918,  amounted  to  494,000,000  pounds  of  wool,  or  91,000,000 
pounds  less  than  at  the  same  date  in  1917. 

It  is  apparent  that  under  such  conditions  the  prices  of  wool  could 
not  remain  immune  from  manipulation.  Indeed,  shortly  after  the 
declaration  of  war  they  began  to  rise  so  that  by  the  end  of  1914  they 
were  20  per  cent  above  their  prewar  level.  Then  came  the  demands 
of  the  various  allied  powers  for  woolen  goods,  especially  for  military 
purposes,  and  1915  and  1916  witnessed  an  extraordinary  rise.  At  the 
end  of  the  latter  year  raw  wool  sold  for  just  twice  its  1913-14  price.2 
Then  came  the  cutting  off  of  the  Australian  supply,3  and  the  Ameri- 
can entrance  into  the  war. 

The  American  declaration  of  war  had  a  stimulating  effect  upon  the 
woolen  trade.  Before  the  year  1917  was  half  over  prices  rose  to  a 
point  225  per  cent  above  the  peace-time  average.  Dealers  bought  far 
into  the  future  and  speculation  was  rampant. 

The  approach  to  regulation. — Many  members  of  the  woolen  in- 
dustry, however,  foresaw  the  disorganization  which  followed  the 

1  During  1915  and  1916  Australia  furnished  approximately  25  per  cent  of  the  wool  im- 
ported into  the  United  States.     In  November,  1916,  the  British  Government  purchased  the 
Australian  production  of  wool  for  the  period  of  the  war  and  one  year  thereafter.     This,  of 
course,  had  an  important  effect  upon  the  receipts  during  1917  and  imports  from  Australia 
for  that  year  fell  to  7,000,000  pounds,  as  against  115,000,000  pounds  in  the  preceding  year. 
Arrangements  which  were  later  made  with  the  British  Government  increased  the  1918  re- 
ceipts from  Australia  a  considerable  degree. 

2  Ohio  three-eighths  blood,  unwashed  wool,  sold  in  December,  1916,  for  49  cents  a  pound, 
as  compared  with  38J  cents  at  the  beginning  of  the  year.     The  average  price  for  the  12 
months  preceding  the  outbreak  of  the  war  had  been  $0.2369.     Similarly,  territory  combing, 
one-half  blood,  sold  at  the  end  of  1916  for  $1.003  per  pound,   as   against  73.8   cents  in 
January  and  $0.5228  in  the  prewar  year.     Imported  wools,  also,  felt  the  effects  of  the  war 
needs  for  cloth,  although  the  rise  in  their  price  was  not  quite  equal  to  that  of  the  domes- 
tic product. 

3  The  cutting  off  of  the  Australian  supply,  which  had  been  mentioned  above,  may  be  said 
to  have  had  a  greater  effect  upon  the  price  of  raw  wool  than  any  other  single  factor  other 
than  the  military  needs  of  our  Army.     Not  only  did  the  British  purchase  of  the  Australian 
clip  actually  cut  down  our  potential  supply,  but  these  wools  were  especially  desirable  for 
American  manufacture  because  of  their  fine  quality.     Wools  of  similar  quality  could  not 
be  duplicated  in  any  other  foreign  market,  and  the  psychological  effect  of  this  loss  upon  the 
trade  was  of  great  consequence.     During  the  four  months  following  the  taking  over  of  the 
Australian  supply  by  Great  Britain,  domestic  wool  prices  rose  40  per  cent,  as  compared  to 
the  prewar  basis. 


GOVERNMENT   CONTROL   OVER  PRICES. 


311 


American  entrance  into  the  war.  Indeed,  on  April  10,  1917,  four 
days  after  the  declaration  of  war,  the  textile  alliance  notified  the 
general  munitions  board  that  there  would  not  be  enough  cloth  in 
the  country  to  meet  both  the 
requirements  of  the  Army  and 
Navy  and  civilian  needs.1  It  is 
probable,  however,  that  the 
general  munitions  board  did 
not  realize  the  significance  of 
the  warning,  and  the  matter 
was  turned  over  to  its  com- 
mittee on  supplies  "  with  the 
understanding  that  if  necessary 
the  board  would  suggest  to  the 
Council  of  National  Defense 
that  it  arrange  with  the  British 
Government  to  remove  the  em- 
bargo "  then  existing  on  wool. 
There  followed  an  offer  on  the 
part  of  the  various  brokers  in 
the  important  markets  to  turn 
over  to  the  Government  such 
stocks  of  wool  as  they  had  on 
hand  at  a  price  equal  to  that  in 
effect  on  April  2.2  Although 
several  members  of  the  board 
urged  acceptance  of  the  offer, 
ignorance  of  the  military  re- 
quirements and  the  fear  that 
governmental  action  would  fur- 
ther disturb- an  already  unstable 
market  led  to  its  rejection.6  Moreover,  it  was  felt  that  the  acceptance 
of  the  offer  ajid  the  resultant  low  price  to  the  military  authori- 
ties would  result  in  raising  the  price  of  other  wools  to  manufacturers. 
The  War  Department  apparently  was  not  fearful,  and  believed  that 
its  requirements  could  be  met,4 

1  Minutes  of  the  general  munitions  board,  Apr.   10,  1917. 

2  Mr.  J.  Rosenwald,  who  headed  the  committee  in  charge  of  wool  supplies,  when  asked 
to  report  the  result  of  his  conference  with  the  wool  dealers,  informed  the  general  muni- 
tions board  that  "  The  brokers  in  Boston,  Philadelphia,  and  Chicago  had  agreed  to  hold 
such  wool  as  they   (then)   had  on  hand  for  the  uso  of  the  Government,  and  that  a  price 
equal  to  that  in  effect  on  April  2  for  raw  wool  had  been  decided  upon."     (Cf.  Minutes  of 
general  munitions  board,  Apr.   11,   1917.) 

8  Minutes,  loc.  cit. 

4  The  following  extract  from  the  minutes  of  the  meeting  of  the  general  munitions  board 
on  April  13,  1917,  sums  up  the  point  of  view  of  the  military  authorities  on  the  question  of 
wool :  "  Col.  Hodgson  reported  that  *  *  *  had  advised  him  that  orders  had  been  placed 
for  articles  requiring  wool,  so  that  there  was  no  necessity  for  holding  the  wool  recently 
offered  by  woolen  brokers.  Col.  Hodgson  further  stated  that  the  feeling  at  the  Quarter- 
master's Department  seemed  to  be  that  there  was  no  apprehension  as  to  wool  at  this 
time." 


RELATIVE  PRICES  Or 

R/WWOOL 

—  DOMESTIC 

1017 

ioia 

1  i  fi 

1  I  S 

S 

AA 

1 

I 

IMPORTED 

GOOD  VICTORIA 

—  BRITISH  MORKET 

i 

BY  MONT  US 
•OANUARY-.tSi;    —  DECEMBERS 
AVCPACE  CUOTED  PP1CE5  JUCV,100*H. 

6 

r 

/- 

1915 

1914              1O15 

1916 

I  i  s 

FTTH 

fjrjs 

I  i  l 

a 

i/ 

1 

so 

60 

i 
rj 

A    A- 

ZL 

Y 

J 

v\ 

3 

'A/ 

/^ 

r 

ao 

60 

60 

s  1  3  E 

^  £  B 

if  OL 

gcti 

ttfi 

I  i  9  fi 

191» 

t014              1013 

tote 

1017     i    ioa 

Relative  prices. — Raw  wool,  domestic,  im- 
ported ;  and  Good  Victoria  British  mar- 
ket.— By  months,  January,  1913,  to  De- 
cember, 1918.  (Average  quoted  prices  July 
1913,  to  June,  1914=100.) 


312  HISTORY   OF   PRICES   DURING   THE   WAR. 

It  had  apparently  also  been  the  belief  of  the  Quartermaster  De- 
partment that  it  could  obtain  a  better  price  at  a  later  date,  but  in- 
stead the  wool  market  continued  upward.  Finally,  in  July  it  be- 
came evident  to  those  in  charge  of  supplies  that  it  would  be  advis- 
able for  the  Government  to  accumulate  a  stock  of  raw  wool,  and  a 
committee  was  appointed  under  the  committee  on  supplies  of  the 
Council  of  National  Defense  to  buy  wool  for  the  Quartermaster 
Corps.  When  this  committee  came  on  the  market  it  found  condi- 
tions quite  the  reverse  from  what  had  been  expected.  Wool  prices 
had  gone  up  in  spite  of  the  Government's  refusal  to  accept  the  offer 
made  by  the  trade  in  the  preceding  April,  and  the  prices  of  July 
30,  relative  to  the  prewar  basis,  were  over  100  per  cent  higher  than 
those  of  April  2.1 

The  abnormal  speculation  in  woolens  virtually  came  to  an  end  in 
the  summer  of  1917,  and  relatively  little  happened  to  the  price  of 
raw  wool  during  the  succeeding  fall  and  winter.  By  October,  how- 
ever, the  Quartermaster  General,  as  well  as  the  committee  on  wool 
supply,  began  to  doubt  the  sufficiency  of  the  existing  wool  supply 
and  the  advisability  of  letting  the  wool  market  follow  its  own  un- 
regulated course.  Indeed,  in  late  October,  the  chairman  of  the  com- 
mittee on  wool  supply  advised  the  War  Industries  Board  that  some 
sort  of  governmental  action  ought  to  be  taken  in  order  to  control 
the  situation.2  This  was  followed,  also,  by  a  letter  from  the  Quar- 
termaster General  in  which  the  possibility  of  the  Government's  pur- 
chasing the  entire  wool  clip  of  the  country  was  suggested.3  It  was 
the  opinion  of  the  board,  however,  that  such  action  was  inadvis- 
able and  so  the  Quartermaster  General  was  informed.4 

Here,  once  more,  the  fact  that  the  authorities  concerned  with  wool 
did  not  know  the  full  Army  needs  was  a  controlling  factor.  In  their 
judgment,  supplies  were  adequate,  and  to  substantiate  their  belief 
they  made  the  statement  that  the  bulk  of  the  manufacturers  had 
covered  their  wool  requirements  for  all  Government  contracts  calling 
for  deliveries  up  to  June,  1918.  After  that  date,  in  their  judgment, 

1  This   situation   evidently   was   disappointing  to   the  purchasing  authorities  and   they 
bought  only  a  relatively  small  amount  of  wool.     It  was  not  known  hy  the  Government  pur- 
chasers either  what  the  size  of  our  Army  was  to  be  or  what  its  needs  would  amount  to. 
Accordingly,  they  purchased  but  little  in  the  domestic  market  and  began  negotiating  with 
Great  Britain  for  the  purchase  of  Australian  wools,  which,  if  obtainable,  would  have  been 
available  at  a  price  much  lower  than  that  of  the  American  product.     This  was  probably 
viewed  as  an  initial  step  in  breaking  the  domestic  price,  but  since  this  wool,  which  was 
finally  purchased  in  October,  did  not  arrive  before  the  spring  of  1918,  when  the  price  of 
wool  bad  been  already  fixed  by  the  price-fixing  committee,  the  purchase  was  never  effec- 
tive in  lowering  the  American  price  level. 

2  Minutes  of  War  Industries  Board,  Oct.  11,  1917. 

3  Minutes  of  War  Industries  Board,  Nov.  15,  1917. 

4  In  late  November  a  third  suggestion  relative  to  the  control  of  wool  was  made,  this 
time  by  the   committee  on   price  control  of  the  Philadelphia  Wool  and  Textile  Associa- 
tion.   This  body  advocated  the  fixing  of  a  maximum  price  for  raw  wool,  but  their  proposal, 
like  the  others,  did  not  receive  any  Indorsement. 


GOVERNMENT    CONTROL   OVER   PRICES.  313 

the  new  domestic  clip  and  imports  from  foreign  countries  would 
provide  a  sufficient  supply.1 

The  adoption  of  a  regulative  policy. — By  early  1918  the  need  for  a 
more  positive  program  became  clear.  The  Army  authorities,  through 
the  use  of  the  War  Trade  Board  import  restrictions,  had  already  se- 
cured an  option  on  all  foreign  wools  entering  the  United  States.2 
A  census  of  existing  stocks,  nevertheless,  showed  that  something 
more  than  the  control  of  the  imported  varieties  would  be  necessary 
if  the  Army  requirements  of  about  125,000,000  pounds  of  scoured 
wool  were  to  be  met.3  Evidence  of  shortage  had  already  been  pre- 
sented in  the  fact  that  the  Army  was  compelled  to  use  shoddy. 
Accordingly,  on  April  5,  1918,  the  War  Department  requested  the 
Boston  Wool  Trade  to  grant  to  the  Government  an  option  over 
the  existing  stocks  of  raw  wool.  The  trade  agreed,  and  promised 
also  to  buy  no  more  new  wool  from  the  growers  until  otherwise 
notified  by  the  authorities.  The  effect  of  this  action  was  soon 
reflected  in  the  attitude  of  the  wool  growers  whose  markets  had 
been  automatically  cut  off.  It  appears  that  they  had  not  been  in- 
formed of  the  instructions  to  the  wool  dealers  regarding  the  cessa- 
tion of  purchases  and  it  was  their  impression  that  the  dealers  had 
stopped  buying  because1  of  the  fear  of  governmental  price  fixing.4 
They  at  once  made  inquiries  of  the  War  Industries  Board  as  to  the 
policy  to  be  pursued  by  that  body,  but  evidently  they  received  no 
definite  assurance  as  to  just  what  was  to  be  done.  The  growers,  ifc 
seems,  feared  that  the  price  of  their  product  would  be  fixed  at  a  price 

1  Just  what  the  attitude  of  the  War  Industries  Board  toward  the  wool  situation  was, 
is  well   presented  by  the  following  extracts   from  a  memorandum   sent  to  the  Quarter- 
master General  on  Nov.  15.     Among  other  things,  it  said  : 

"  We  do  not  feel  the  urgency  at  this  time  of  taking  on  these  duties  (taking  over  of 
the  wool  clip)  for  the  following  reasons:  (1)  The  purchasing  of  wool  in  the  grease 
requires  very  expert  knowledge.  It  would  be  necessary  to  engage  a  staff  of  these  buyers 
before  we  could  intelligently  purchase  such  a  large  and  varied  assortment  of  wool  as  the 
United  States  grows.  (2)  The  bulk  of  the  manufacturers  have  covered  their  requirements 
on  the  Government  contracts  they  have  undertaken.  (3)  The  latest  figures,  dated,  Sept. 
30,  1917,  show  unsold  wool  in  Boston  equal  to  130,000,000  pounds.  To  this  we  can  add 
the  70,000,000  pounds  of  Australian  wool  and  about  10,000,000  pounds  of  East  India 
wool  released  by  the  British  Government  to  us  for  Government  requirements.  *  *  * 
We  can  figure  on  at  least  200,000,000  pounds  from  South  America  in  the  next  few 
months.  The  items  will  bring  the  total  to  over  400,000,000  pounds  available.  By  May 
and  June  the  new  wool  clip  of  the  United  States  will  be  coming  on  the  market.  This 
represents  another  270,000,000  or  280,000,000  pounds. 

"  We  may  feel  after  the  first  of  next  year  that  it  is  necessary  to  take  some  action  on 
the  purchase  of  a  part  of  the  new  clip,  but  for  the  present,  owing  to  reasons  advanced 
above,  we  feel  that  it  is  better  to  let  the  matter  rest  as  it  is." 

2  On  Dec.  15,  1917,  the  War  Trade  Board  had  ruled  that  after  that  date  all  imported 
wools  would  be  subject  to  Government  option  at  a  price  equal  to  5  per  cent  less  than 
the  July  30,  1917,  price  in  Boston. 

3  A  census  of  wool  stocks  made  in  early  1918  by  the  War  Department  disclosed  a  supply 
in  the  hands  of  dealers  of  less  than  35,000,000  pounds,  scoured  basis. 

4  A 'statement  made  by  the  representatives'  of  the  National  Wool  Growers'  Association 
at  the  first  meeting  of  the  price-fixing  committee  and  the  wool  growers  was  to  the  effect 
that  the  dealers  in  the  West  would  not  buy  wool  because  they  feared  that  Ihe  Government 
would  fix  the  price  of  wool  at  a  figure  lower  than  the  current  market  figure. 


314  HISTORY   OF   PRICES   DURING   THE   WAR. 

relatively  lower  than  that  then  prevailing,  and  thought  it  desirablo 
that  any  such  move  be  preceded  by  action  on  their  part.  They  there- 
fore asked  for  an  opportunity  to  appear  before  the  price-fixing  com- 
mittee, and  April  19,  1918,  they  offered  their  entire  clip  to  the  Gov- 
ernment at  the  current  market  price.1  In  the  event  that  the  price- 
fixing  committee  was  unwilling  to  buy  the  clip,  it  was  the  opinion  of 
the  wool  growers  that  the  entire  situation  should  be  left  free  to  the 
unregulated  forces  of  the  market.  Moreover,  they  believed  that  the 
governmental  authorities  ought  to  make  a  public  statement  to  that 
effect.  In  other  words,  the  wool  growers  wanted  the  price  fixing 
committee  publicly  to  commit  itself  to  the  policy  of  leaving  the 
American  wool  clip  untouched.  But  this  the  price-fixing  committee 
refused  to  do,  remarking  in  the  course  of  its  refusal  that  they  had 
no  authority  to  bind  the  Government  to  any  policy.2 

Negotiations  with  the  wool  growers  were  about  to  end  when  the 
representative  of  the  wool  section  of  the  War  Industries  Board  made 
the  statement  that  the  military  forces  would  require  the  whole  do- 
mestic clip,  and  suggested  that  the  Government  buy  it.8  Immedi- 
ately the  situation  was  changed,  and  from  that  moment  it  was  quite 
evident  that  the  United  States  Government  was  about  to  take  over 
the  1918  clip. 

With  the  question  of  the  disposal  of  the  wool  clip  settled,  it  re- 
mained to  fix  a  price  at  which  the  Government  would  take  wool  over. 
The  growers  insisted  upon  the  current  market  price,  which,  as  has 
already  been  said,  was  three  times  higher  than  the  1912-1914  level. 
The  price-fixing  committee  refused  this  request,  and  reference  was 
made  to  the  British  purchase  price,  which  was  but  75  per  cent  above 
the  prewar  average,  to  substantiate  their  refusal.4  In  their  opinion 
the  price  of  July  30, 1917,  was  a  fair  price  for  raw  wool,  especially  in 
view  of  the  fact  that  the  Government  had  been  purchasing  imported 
wool  at  that  figure  during  the  preceding  four  months.  They  con- 
tended, furthermore,  that  the  April,  1918,  price  was  not  a  "  fair 

1  This  offer  was  made,  however,  only  with  the  provision  that  the  Government  buy  the 
entire   clip,   which  was  estimated   to  be   about   300,000,000   pounds.      The   market    price 
incidentally  was  at  the  time  about  three  times  the  prewar  average.     In  the  course  of  the 
discussion  between  the  growers'  representatives  and  the  members  of  the  price-fixing  com- 
mittee it  was  brought  out  that  the  price  asked  for  the  clip  varied  from  45  to  80  cents  a 
pound,  depending  on  grades,  whereas  formerly  similar  wools  sold  from  5  to  20  cents. 

2  See  Minutes  of  price  fixing  committee,  Apr.  19,  1918. 

3  Mr.  Elliot  said  :   "  Gentlemen,  the  Government  needs  will   require  all   of  the  clip,  so 
why  should  we  not  buy  it?  " 

4  It  is  interesting  to  note,  in  this  connection,   the  growers'   contention  that  the  then 
current  high  prices  were  necessary  to  keep  production  at  the  high  level  required  by  war 
needs.     And  this  theory  of  stimulating  production,  according  to  several  members,  also 
guided  the  price-fixing  committee  in  determining  upon  what  price  should  be  fixed  for  a 
given  commodity  (see  p.  242).     In  the  instance  of  wool,  however,  the  price-fixing  commit- 
tee seems  to  have  laid  aside  this  theory,  as  is  shown  by  the  following  statement  of  the 
chairman :  "  The  old  theory  that  the  high  price  stimulates  production  is  an  error.     One 
side  is  when  a  man  gets  a  certain  amount,  his  steam  power  gets  down  a  little  lower.     He 
doesn't  work  as  many  days.     In  other  words,  it  isn't  exact  science  that  the  higher  price 
increases  production." 


GOVERNMENT   CONTROL  OVER  PRICES.  315 

market  price,"  since  it  was  not  established  under  normal  conditions, 
whereas  the  July,  1917,  figure  was  one  which  was  arrived  at  in  a 
market  where  Government  demands  played  little  or  no  part.1 

The  wool  growers,  however,  claimed  that  the  offer  of  the  Govern- 
ment did  not  allow  for  the  high  costs  of  producing  wool  and  refused 
to  accept  the  suggested  price.  The  dealers  from  the  various  large 
wool  markets  had  by  this  time  also  taken  up  their  case  with  the 
price  fixing  committee,  and  they,  too,  objected  to  the  July  30,  1917, 
price,  since  it  allowed  for  no  profit.  But  refusal  to  accept  the 
proffered  price  was  in  vain,  for  both  the  growers  and  dealers  were 
told  that  there  were  but  two  alternatives — first,  the  July  30,  1917, 
price;  or  second,  the  commandeering  of  the  entire  wool  supply  and 
the  determination  of  a  price  by  Board  of  Appraisers  of  the  War 
Department.2  The  former  alternative  was  accepted  and  on  April  23 
the  Government  agreed  to  take  over  the  raw  wool  then  in  the  hands 
of  dealers  ati  a  net  price  equal  to  that  of  July  30,  1917  ;3  while  an 
agreement  was  made  with  the  growers  whereby  the  Government  was 
given  a  prior  right  to  acquire  all  of  the  1918  wool  clip  or  "  any  por- 
tion thereof  that  it  might  require."4  The  remainder  was  to  be  sub- 
ject to  allocation  for  civilian  purposes  under  the  direction  of  the 
War  Industries  Board. 

To  the  War  Department  was  assigned  the  task  of  handling  the 
wool  supply,  although  the  machinery  for  purchasing  and  evaluating 
was  formed  by  the  price  fixing  committee,  acting  in  conjunction  with 
the  growers  and  dealers.  All  parties  desired  that  as  little  change 
as  possible  be  made  in  the  organization  of  the  woolen  industry.  The 
final  plans,  therefore,  provided  for  the  use  of  the  customary  channels 
of  distribution.  The  growers  were  to  consign  their  wool  to  dealers 5 

1  The  legal  department  of  the  War  Industries  Board  had  interpreted  "  a  market  price  as 
one    established   under    certain   normal    conditions."      A   market    with    large    Government 
demands  was  not,  in  their  opinion,  normal. 

2  The  plan  presented  to  the  wool  dealers  by  the  chairman  of  the  price-fixing  committee 
was  rather  comprehensive.     It  was  his  idea  that  (1)  the  Government  should  commandeer 
the  clip  and  fix  the  price  to  be  paid,    (2)   the  wool  dealers  should  continue  operating  as 
usual  and  receive  a  fair  compensation  for  their  services,  (3)   the  wool  dealers  should  sell 
to  manufacturers  only  under  instructions  from  the  War  Industries  Board,   (4)   the  manu- 
facturers  should   be  licensed,   and    (5)    if   necessary,    standard   clothes   should  be  manu- 
factured at  a  price  which  would  be  fixed  down  through  the  wholesaler  and  retailer. 

3  For  such  wool  as  the  dealers  might  have  on  hand  at  the  time,  which  could  be  shown 
to  have  cost  more  than  the  July  30,  1917,  price,  the  Government  agreed  to  pay  an  amount 
equal  to  the  original  cost  plus  5  per  cent. 

4  A  series  of  prices  as  of  July  30,  1917,  was  drawn  up  and  used  as  a  basis  of  payment 
for  raw  wool.     These  prices  varied  from  $1.07  per  pound,  scoured  basis,  for  common  and 
braid,  eastern  and  territory  wools,  to  $1.85  for  fine  delaine   (Ohio)  wool. 

5  Dealers  were  forbidden  to  buy  wool  directly.     They  could  only  accept  consignments 
which  after  being  graded  were  valued  by  the  Government  valuation  committee.     This  com- 
mittee   was    made    up    of    representatives    of    the   growers,    dealers,    and    manufacturers. 
Manufacturers  were  also  forbidden  to  purchase  wool  except  in  the  designated  distributing 
centers,  and  then  only  with  the  permission  and  consent  of  the  Government.     Those  mills 
working  on  Government  orders,   however,   which   were   located   in   wool-growing  sections 
not  near  the  centers  of  distribution,  were  given  permits  through  the   Wool  Division   of 
the  War  Industries  Board  to  buy  certain  amounts  of  wool  in  their  immediate  neighborhood. 


316  HISTORY   OF   PRICES   DURING   THE   WAR. 

at  the  July  30,  1917,  price  minus  the  cost  of  transportation  to  Boston 
and  the  compensation  to  the  dealer,1  and  the  dealer  in  turn  was  to 
forward  such  consignments  to  the  United  States  Government.  The 
profits  allowed  to  dealers  were  definitely  fixed,  and  varied  from  \\ 
cents  for  each  pound  of  wool  handled  for  country  dealers  to  5  per 
cent  on  the  season's  business  for  dealers  in  distributing  centers. 

The  effect  of  wool  control. — By  the  summer  of  1918,  the  War 
Department  controlled  the  entire  supply  of  raw  wool  with  the  ex- 
ception of  that  which  was  in  the  hands  of  manufacturers  prior  to 
April  5.  Soon  afterwards  approximately  half  of  the  active  combs, 
cards,  spindles,  and  wide  looms  of  the  country  were  engaged  on 
Government  work.  This  number  increased  month  by  month  until 
November,  while  stocks  of  privately  owned  wool  progressively  di- 
minished. In  October  provision  was  made  for  taking  over  the  1919 
clip.  More  and  more  persistent  demands  were  made  by  manufac- 
turers that  wool  be  allocated  for  private  orders,  but  virtually  all 
requests  were  refused  and  definite  word  was  given  out  that  no 
civilian  allocations  would  be  made  before  April  1,  1919.  At  the 
time  of  the  armistice,  the  War  Department  had  accumulated  a  supply 
of  raw  wool  sufficient  for  six  months  at  the  war-time  rate  of  con- 
sumption.2 

These  large  stocks,  together  with  the  uncertainty  as  to  the  future 
price  level,  were  leading  to  a  serious  depression  in  the  woolen  indus- 
try, when  at  the  end  of  the  year  the  War  Department  determined 
to  dispose  of  their  stocks  through  a  series  of  auctions.  On  January 
15,  1919,  it  was  announced  that  the  minimum  price  acceptable  at 
these  sales  would  be  on  a  parity  with  the  British  civil  issue  price.3 
But  even  this  policy  on  the  part  of  the  War  Department  did  not 
stimulate  the  woolen  industry,  and  the  first  four  months  of  1919 
Avitnessed  widespread  mill  idleness.  By  April,  the  period  of  read- 
justment had  been  bridged  over  and  buying  at  Government  auction 
had  been  quite  spirited.  Indeed,  by  June  1,  1919,  270,000,000  pounds 
of  wool  had  been  disposed  of  by  the  War  Department,  and  the  prices 
paid  for  the  better  grades  virtually  equaled  the  war  level. 

HIDES,  SKINS,  AND  LEATHER.    • 

Unlike  the  prices  of  cottons,  woolens,  and  other  forms  of  clothing, 
the  price  of  leather,  and  the  raw  materials  from  which  leather  is 

1  The   necessity    of   concentrating   the   wool    supply    near    the   centers    of    consumption 
led  to  the  restricting  of  distribution  to  only  approved  dealers.     Approved  dealers  were 
those  authorized  by  the  War  Industries  Board  to  handle  wool. 

2  On   Nov.   23,   1918,  the  statistical  branch,   General   Staff,   War   Department,   reported 
stocks  of  233,867,685  pounds  of  wool  on  hand.     The  total  purchases  to   that  date  had 
been   421,373,609  pounds,  thus   making   a   total   of  187,505,924    pounds  which   had   been 
sold  to  manufacturers.     There  were  yet  to  be  delivered  on  prior  purchases  222,000,000 
pounds  of  wool,  which  made  a  total  of  455,867,685  pounds  to  be  disposed  of. 

3  For  comparison  with  United   States  buying  prices,   see  War   Industries  Board  Price 
Bulletin  No.  24,  "  Prices  of  Wool  and  Wool  Products,"  by  K.  Snodgrass. 


GOVERNMENT   CONTROL   OVER   PRICES. 


317 


made,  when  compared  to  the  general  price  level,  remained  relatively 
stable  during  the  period  of  the  World  War.  Indeed,  it  was  only  in 
late  1916,  under  the  influence  of  heavy  allied  buying,  that  any  per- 
ceptible rise  in  leather  prices  over  those  of  commodities  in  general 
occurred,  and  this  rise  was  short  lived.1  During  1917  and  1918  the 
index  number  of  leather,  based 
upon  the  1913-14  average,  re- 
mained virtually  unchanged  and 
at  no  time  did  it  approach 
within  15  per  cent  of  the  price 
level  of  "  all  commodities."  The 
remarkable  stabilization  of 
leather  prices  that  came  in  De- 
cember, 1916,  in  the  United 
States,  was  the  result,  curiously, 
of  British  price  fixing.  British 
control,  indeed,  which  came  rela- 
tively early,  appears  to  have  had 
a  greater  influence  upon  the 
American  leather  market  than 
our  own  price  fixing  of  the  sum- 
mer of  1918. 

Leather  prices  as  a  whole  were 
at  a  relatively  low  level,  when 


WDCHTCD  nnex  NC»eEC3  or  PBEZS  cr 

—  -HIDES  AND  SKBBJJUWER  AND 
iXATHCR  MANUFACTURES 
—  -ALL  COMMODITIES" 

BY  MONTHS 
.JflNUAOY.tOU  •"•  DCCCMBCR,ei« 
AVERAGE  CWOTCD  PRICES  .Aia'.ISJl'VWICKM'lOO 

1913 

1914 

1915 

19*6 

1917 

lOlfl 

EDO 

fZOD 

jpEE 

ED 

onr 

ro 

2/0 

-./ 

Aw 

^ 

u£> 

^ 

140 

. 

f 

A 

^_/ 

-^ 

P 

100 

eo 

60 

eo 

*  a  fc 

t  k  k 

3  tt 

\  k  & 

i  k  5 

i  3  5. 

1913 

..»?•* 

1913    , 

KM 

1917 

1£M6 

Weighted  index  numbers  of  prices. — 
Hides  and  skins,  leather  and  leather 
manufactures,  and  "All  commodities."- 
By  months,  January,  1913,  to  December, 
1918.  (Average  quoted  prices,  July, 
1913,  to  June,  1914=100.) 


the  price-fixing  committee  under- 
took to  fix  prices  in  April,  1918. 
In  the  previous  month,  a  price 
agreement  had  been  made  by  the 
War  Industries  Board  with  the 
distributors  of  sheepskins  rela- 
tive to  the  price  to  be  paid  by  the 
United  States  Army  for  jerkin  leather,2  but  this  was  nothing  more 
than  a  long-time  contract  applicable  only  to  Army  orders.  It  was 
fear  of  the  effect  of  several  expected  events  in  the  leather  market 
apon  prices,  rather  than  current  high  prices,  which  led  to  the  fixing 
of  hide  and  skin  prices  in  the  spring  of  1918. 

There  were  four  factors  in  particular  that  seemed  to  threaten 
instability  in  the  leather  market.  First,  the  needs  of  our  growing 
Army  had  prompted  the  Quartermaster  Corps  to  contemplate  plac- 
ing enormous  orders.3  This,  it  was  expected,  would  lead  to  compe- 

1  The  rise  experienced  in  late  1916,  appears  to  have  been  halted  abruptly  at  the  time 
that  the  British  orders  controlling  the  importation,  and   fixing  of  prices   for   raw   hides 
and  skins,  went  into  effect. 

2  See  p.   729. 

&  In  April,  1918,  the  United  States  Army  placed  contracts  with  American,  manufacturers 
for  5,604,008  pairs  of  shoes,  valued  at  $40,446,531. 


318  HISTORY   OF   PRICES   DURING  THE   WAR. 

tition  for  hides  and  skins  in  the  open  market  and  force  prices  out  of 
control.  Secondly,  these  large  Army  orders  had  to  be  extended  over 
a  series  of  months  and  their  size  necessitated  deliveries  over  rela- 
tively long  periods.  The  tanners,  then,  would  need  to  make  pur- 
chases of  hides  extending  over  long  periods.  The  fixing  of  the  price 
of  hides  and  skins,  in  the  opinion  of  the  Army  purchasing  authori- 
ties, would  lead  to  greater  regularity  in  the  supplying  of  require- 
ments by  eliminating  the  tanner's  risks.  Moreover,  this  stabilization 
of  the  price  of  raw  materials,  it  was  hoped,  would  lead  to  a  more 
steady  market  price  for  finished  leather  products.  Thirdly,  the  Brit- 
ish Government  was  at  this  time  about  to  enter  the  American  market 
for  a  considerable  quantity  of  leather.  The  British  purchasing  com- 
mission had  already  informed  the  War  Industries  Board  that  it  was 
about  to  purchase  $35,000,000  in  value  of  leather,  and  it  was  evident 
to  the  authorities  that  any  bid  of  this  size  would  play  havoc  with 
the  prices  of  hides  and  skins.  Finally,  there  was  the  shipping  situ- 
ation. The  United  States  has  at  all  times  been  a  large  importer  of 
foreign  hides  and  skins.  Our  receipts  for  the  fiscal  years  ending 
June  30,  1917,  and  1918  amounted  to  about  700,000,000  and  432,000,- 
000  pounds,  respectively.  The  shortage  of  shipping,  however,  ne- 
cessitated the  cutting  off,  as  far  as  possible,  of  dispensable  imports 
and  the  United  States  Shipping  Board  was  about  to  recommend  a 
three-month  embargo  on  the  importation  of  all  hides,  skins,  leather, 
and  manufactures,  excepting  such  cattle  hides  as  were  fit  for  Army 
use.1  This  action,  it  was  believed,  would  bring  chaos  to  the  leather 
market,  and  result  in  erratic  rises  unless  some  steps  were  taken 
immediately. 

Cattle  hides. — The  price  fixing  committee,  with  these  points  in 
mind,  met  on  April  26,  1918,  with  representatives  of  producers,  im- 
porters, and  distributors  of  hides  and  skins  to  fix  prices  for  their 
products.  A  schedule  was  presented  by  a  committee  representing  the 
industry,  in  which  the  price  fixing  committee  was  asked  to  fix  a 
maximum  price  for  hides  and  skins  equal  to  the  average  market 
level  for  the  period  April  1  to  24.  This  average  was  approximately 
10  per  cent  higher  than  the  current  market  quotation,  and  the  price 
fixing  committee  objected  on  the  ground  that  its  acceptance  would 

I  The  final  report  of  the.  hide,  leather,  and  leather  goods  division  of  the  War  Industries 
Board    (December,    1918)    states: 

"  In  cooperation  with  the  Shipping  Board  for  the  releasing  of  tonnage,  and  with  the 
Food  Administration,  restrictions  on  imports  were  agreed  to  which  deprived  the  industry 
of  about  10,000,000  hides  and  kips  and  about  90,000,000  goat  and  sheep  skins,  the 
tonnage  allowed  for  leather  raw  stock  being  confined  entirely  to  requirements  for  war 
necessities. 

II  The  final  restrictions  which  practically  limited  importations  of  raw  stocks  to  certain 
heavy  hides  from  South  America,  to  hides  coming  by  rail,  and  to  hides  coming  as  back 
haul  from  Europe,  went  into  effect  June  15." 


GOVERNMENT   CONTROL   OVER  PRICES.  319 

mean  raising  the  existing  price,  and  this  they  said  was  contrary  to 
their  policy.  The  live  stock  producers  also  took  issue  with  these 
suggested  prices ;  not,  however,  on  the  ground  of  its  fairness.  It  was 
their  contention  that  price  fixing  in  any  form,  was  unnecessary  and 
that  in  their  opinion  no  emergency  existed  which  warranted  any 
Governmental  interference.1 

The  price-fixing  committee  overruled  the  objections  of  the  live- 
stock producers  and  on  April  30,  1918,  fixed  maximum  prices  for  all 
the  stocks  of  domestic  hides  and  skins  in  hand  at  that  date;  for  the 
domestic  take-off  for  the  months  of  May,  June,  and  July;  and  for 
all  imported  hides  and  skins  shipped  from  ports  of  origin  to  and 
including  July  31,  1918.2 

The  practicability  of  these  fixed  prices  was  doubted  by  members 
of  the  leather  industry  when  the  time  for  revisions  approached.  On 
July  19,  1918,  12  days  prior  to  the  expiration  of  these  prices^  the 
industry  was  called  together  in  order  that  action  might  be  taken 
relative  to  their  continuation  or  revision.  Complaints  were  made 
by  some  against  the  agreed  prices,  and  indeed,  it  was  contended  that 
the  price-fixing  committee  had  put  an  artificial  price  upon  hides  and 
skins.  It  appears  that  the  better  grades  of  hides  were  being  taken 
by  the  Government  at  the  maximum  price,  thereby  keeping  their 
value  up  to  the  figure  agreed  upon  in  April,  while  the  cheaper  grades, 
for  which  there  was  little  demand,  never  reached  the  fixed  maximum. 
The  price-fixing  committee  recognized  the  logic  of  this  contention 
and  suggested  that  the  price  for  the  following  three  months  be  low- 
ered. But  at  this  point  the  packers  and  the  live-stock  producers 
objected  on  the  ground  that  the  changing  of  hide  prices  at  that  par- 
ticular time  would  inject  an  element  of  doubt  into  the  cattle  market 
and  check  the  stocking  up  with  feeder  stock  then  in  progress. 

The  price-fixing  committee,  however,  held  to  its  belief,  and  after 
the  appointment  of  a  body  made  up  of  members  of  the  trade  and 
the  price-fixing  committee  to  draw  up  a  price  schedule,  fixed  a 

1  See  minutes  of  the  price  fixing  committee,  June  26,  1918. 

2  Two  sets  of  prices  were  actually  fixed — one  to  apply  to  stocks  and  take-off  up  to 
and  including  Apr.  30,  1918,  and  the  other  for  the  May,  June,  and  July  take-off.     Hides 
from  heavy  native  steers,  No.  1,  were  used  as  the  base  price  in  both  cases  and  differentials 
applied  for  other  types.     A  prjice  of  29  cents  per  pound  was  adopted  for  the  stocks  and 
take-off  to  Apr.   30,   while  33   cents  was   the  price  fixed  for   the  May,   June,   and   July 
product.     These  prices  were  about  10  per  cent  higher  than  the  prevailing  market  prices. 
As  above  stated,  the  price-fixing  committee  at  first  objected  to  this  increase  of  current 
prices ;    and   in  approving   of   the   prices    fixed   the   committee    explained    its    action   by 
stating  that  the  reason  for  their  adoption  was  the  desire  to  keep  the  good  will  of  the 
industry.     The  hide  and  skin  interests  had  also  suggested  a  10  per  cent  increase  on  im- 
ported hides,  but  this  was  not  accepted.     Indeed  the  price-fixing  committee  through  the 
instrument  of  the  import  license  system,  fixed  the  maximum  price  of  foreign  hides  and  skins 
similar  to  those  produced  in  the  United  States  at  the  same  figure  that  was  agreed  upon 
for  the  domestic  product.     The  complete  schedule  adopted  will  be  found  on  pp.  729-752. 


320  HISTORY   OF   PRICES   DURING   THE   WAR. 

maximum  price  of  30  cents  1  for  No.  1  native  steer  hides  to  be  effec- 
tive for  three  months  ending  November  1,  1918.2 

As  the  end  of  1918  approached  provision  was  made  for  the  further 
revision  of  hide  and  skin  prices,  and  on  October  23  a  new  schedule 
was  presented  to  the  trade  for  the  months  of  November,  December, 
and  January.  This  schedule  provided  for  a  still  further  decrease  in 
prices.  The  figure  for  November  and  December  was  1  cent  less  than 
the  existing  maximum  price,  and  that  for  January  was  2  cents  lower. 
This  apparent  decrease  may  be  explained  by  the  fact  that  the  hides 
secured  from  the  winter  take-off  are  usually  of  lower  quality  than 
those  from  the  take-off  of  other  months.  It  was  really  proposed  to 
continue  the  fall  prices  minus  a  differential  to  allow  for  the  poorer 
quality.  Here  again,  however,  the  packers  protested,3  this  time  on 
the  ground  that  the  differential  applied  would  be  reflected  in  the  price 
of  meat.  "  With  the  price  of  hides  fixed,"  they  said,  "  meat  would 
bear  the  brunt  of  the  fluctuations  in  the  live-stock  market."  "But  the 
prices  suggested  by  the  price-fixing  committee  again  were  adopted, 
and  29  cents  was  made  the  price  for  the  November-December  take- 
off of  No.  1  native  heavy  steer  hides.  In  spite  of  the  cessation  of 
hostilities  the  January  price  of  28  cents  also  went  into  effect  on  the 
first  of  that  month,  but  on  January  31,  1918,  maximum  prices  of 
hides  expired  by  limitation. 

Sheepskins. — The  extraordinary  demand  for  leather  jerkins  for  the 
use  of  our  fighting  forces  had  sent  the  price  of  sheepskins  to  a  level 
250  per  cent  above  its  prewar  average.  Since  the  needs  of  the  Army 
were  sufficiently  large  to  absorb  virtually  the  entire  domestic  output 4 
it  was  thought  advisable,  to  make  some  arrangement  whereby  the 
governmental  authorities  might  secure  an  option  upon  the  necessary 
supply  at  a  fixed  price.  Accordingly,  on  March  20,  1918,  the  chair- 
man of  the  War  Industries  Board  called  the  various  packers  and 
wool  pullers  to  Washington.  As  a  result  of  this  meeting  an  agree- 
ment was  reached  whereby  the  wool  pullers  promised  to  give  to  the 
tanners  of  jerkin  leather  an  option  on  all  picked  sheepskins  at  a 
maximum  price  of  14  cents  per  square  foot,  while  the  tanners  in  turn 
agreed  to  dress  these  skins  for  the  United  States  Government  at  a 
fee  of  4  cents  per  square  foot.  In  other  words,  the  Army  authorities 

1  This  price,  it  will  be  noted,  was  3  cents  lower  than  the  maximum  fixed  for  the  pre- 
ceding  months. 

2  Differentials  based  upon  this  30-cent  price  were  lated  fixed  by  the  hides  and  leather 
section   of  the  War  Industries  Board.      It  should   be  added   also   that   the  trade  recom- 
mended that  all  dealers  and  buyers  of  hides  and  skins  be  licensed,  but  in  this  the  price- 
fixing   committee   refused   to    concur,    since    they    saw    no   especial    benefit   to   be   derived 
therefrom. 

3  See  minutes  of  the  price-fixing  committee,  Oct.  28,  1918. 

*  The  estimated  production  of  pelts  of  the  type  used  in  making  leather  jerkins  was 
1,000,000  per  year.  Of  these  the  Army  took  an  average  of  75,000  per  month,  or  900,000 
per  year. 


GOVERNMENT   CONTROL   OVER  PRICES.  321 

really  contracted  to  take  over  all  pelts  at  a  fixed  price  for  the  period 
ending  June  7,  1918. 

The  renewal  of  this  contract  at  expiration  was  not  considered 
desirable,  and  it  was  thought  advisable  rather  to  include  sheep  pelts 
with  other  hides  and  skins  under  a  system  of  fixed  prices  applicable 
both  to  governmental  and  civilian  purchasers.  The  matter  was  there- 
fore presented  before  the  price-fixing  committee,  together  with  a  list  of 
prices  which  had  been  prepared  by  the  industry  and  approved  by  the 
chief  of  the  hide  and  leather  section  of  the  War  Industries  Board, 
and  on  June  7  a  series  of  maximum  prices  ranging  from  8  to  18 
cents  per  pound  was  fixed  for  the  various  grades  of  sheepskins1 
for  the  period  ending  August  1,  1918.  These  prices  were  later  ex- 
tended for  the  months  August,  September,  and  October,  and  on 
October  30,  after  being  slightly  changed  so  as  to  allow  for  the 
poorer  grade  of  pelts  which  came  into  the  market  during  the  winter 
months,  they  were  further  adopted  as  maxima  for  November,  De- 
cember, and  January. 

Tanned  leather. — It  was  evident  from  the  beginning  that  price 
fixing  in  the  leather  industry  would  have  to  be  extended  to  its 
various  fabricated  products.  Indeed,  in  April,  when  maximum 
prices  for  hides  were  first  adopted,  the  price-fixing  committee  publicly 
stated  that  as  a  matter  of  policy  it  would  meet  with  the  tanners2 
"  with  a  view  to  establishing  fair  and  equitable  prices  on  leather, 
and  would  endeavor  to  see  that  leather  products  would  reach  the 
consumer  at  fair  and  equitable  prices." 

But  the  fixing  of  leather  prices  was  soon  found  to  be  a  more 
difficult  task  than  that  of  determining  a  price  for  raw  hides.  Hides 
are  but  a  by-product  of  the  packing  house,  and  animals  are  killed 
primarily  for  their  meat  and  not  for  their  hides.  The  cost  of  produc- 
ing a  hide,  therefore,  pla}7s  but  a  minor  and  indirect  part  in  de- 
termining its  market  price.  But  with  leather  certain  costs  had  to  be 
determined,  since  the  selling  price  is  in  large  part  determined  not 
only  by  the  cost  of  the  raw  hides  plus  the  cost  of  manufacture  but 
also  by  other  incidental  costs.  There  is  involved,  too,  the  profit 
of  the  tanner.  The  Federal  Trade  Commission,  accordingly,  was 
asked  to  investigate  the  cost  of  manufacturing  various  kinds  of 
leather. 

Harness  leather:  The  first  case  of  price  fixing  in  the  tanned 
leather  industry  occurred  in  June,  1918,  and  was  made  applicable 
to  the  variety  used  in  the  manufacture  of  harness.  The  informal 

1  The  schedule  of  prices  as  adopted  is  to  be  found  on  p.  738. 

-  In  the  case  of  harness  leather,  the  Army  price,  which  had  been  fixed  by  informal 
agreement  in  January,  1918,  may  be  considered  as  an  early  attempt  to  fix  the  price  of 
tanned  leather.  But  here,  also,  as  with  the  agreement  pertaining  to  sheep  skins  for 
Army  jerkins  mentioned  above,  what  reaHy  existed  was  a  long-time  contract,  little  differ- 
ent from  any  other  commercial  agreement  extending  over  a  fixed  period. 

125547°— 20 21 


322  HISTORY   OF   PRICES   DURING  THE   WAR. 

price  agreement  entered  into  by  the  Army  and  the  producers  of 
harness  leather  was  about  to  expire,  and  the  establishment  of  a  defi- 
nite maximum  price  for  all  purchasers  was  considered  preferable 
to  the  extension  of  the  Army  option.  The  Federal  Trade  Commis- 
sion, moreover,  had  collected  sufficient  cost  data  to  warrant  the 
fixing  of  a  fair  maximum  price  for  all  consumers.  On  June  25, 
therefore,  the  price-fixing  committee  in  agreement  with  the  pro- 
ducers fixed  the  maximum  price  for  all  weights  of  black  harness 
leather  "  going  either  to  the  Government  or  into  civilian  outlets,  to 
be  effective  until  November  1,  1918,  at  TO  cents  *  per  pound  for  grade 
A."  This  price  was  subsequently  extended  to  December,  at  which 
date  it  was  allowed  to  lapse. 

Sole  and  belting  leather:  It  was  not  until  the  middle  of  July, 
1918,  that  the  question  of  sole-leather  prices  was  taken  under  consid- 
eration by  the  price-fixing  committee,  and  even  then,  because  of  lack 
of  sufficient  cost  data,  no  definite  action  was  taken.  The  chief  of  the 
hide  and  leather  section  of  the  War  Industries  Board  had  recom- 
mended the  regulation  of  the  tanners'  profits  as  the  only  effective 
method  of  fixing  the  price  of  sole  leather.  Since  this  was  a  radical 
departure  from  the  former  policies  of  the  price-fixing  committee,2 
the  matter  was  laid  aside  for  further  investigation.  Shortly  after- 
wards a  committee  representing  the  tanning  industry  submitted  a 
report  on  the  cost  of  tanning  sole  leather  and  suggested  that  13.5 
cents  per  pound  be  used  as  the  tanning  cost  basis  in  determining 
maximum  prices.  This  figure  they  claimed  netted  them  a  return  of 
10  per  cent,  and  since  they  averaged  but  one  turnover  per  year  on 
their  investment,  an  allowance  of  13.5  cents  for  tanning  would  make 
their  profits  equal  to  10  per  cent  per  annum.  Although  the  cost  data 
of  the  Federal  Trade  Commission  showed  12  cents  as  a  fair  average 
figure  for  tanning  costs,  the  price  schedule  of  the  tanners  was  ac- 
cepted as  the  basis  on  which  prices  were  fixed,  and  on  August  8,  1918, 
maximum  prices  on  belting  and  sole  leather  were  announced  by  the 
price-fixing  committee.3  These  prices  were  to  become  effective  im- 
mediately and  were  to  continue  until  November  9.  On  October  28, 
at  the  request  of  the  tanning  industry,  they  were  extended  to  De- 
cember 8.  The  need'  for  their  further  continuation  having  been 
removed  by  the  signing  of  the  armistice  in  November,  maximum 
prices  of  sole  and  belting  leather  were  not  renewed  after  their 
expiration  on  the  latter  date. 


price  was  substantially  the  same  as  had  prevailed  on  the  open  market  during 
the  preceding  half  year.  Other  prices  were  fixed  for  the  different  varieties  of  harness 
leather,  and  these  too  showed  virtually  no  change  from  the  current  market  quotations. 

2  The  policy  of  determining  a  fixed  price  on  the  basis  of  return  upon  the  investment  in 
a  given  industry,  although  untried  during  the  early  months  of  the  regime  of  the  price- 
fixing  committee,  was  later  applied  very  frequently.  Such  was  especially  true  in  the 
case  of  cotton  fabrics  and  chemicals  (see  pp.  298  and  33S). 

8  A  complete  schedule  of  sole  and  belting  leather  prices  will  be  found  on  p.  750. 


GOVERNMENT    CONTROL   OVER   PRICES.  323 

Upper  leather:  With  the  prices  of  hides  and  skins,  harness,  sole, 
and  belting  leather  fixed,  there  still  remained  the  task  of  determining 
maximum  prices  for  upper  leather.  The  lack  of  sufficient  cost  data 
and  the  proposed  inauguration  of  a  system  of  price  fixing  for  shoes 
delayed  the  adoption  of  a  fixed  price  schedule  for  upper  leather, 
however,  and  it  was  only  within  10  days  of  the  signing  of  the  armis- 
tice that  any  definite  action  was  undertaken.  Before  the  prices 
adopted  had  been  announced,  hostilities  had  ceased,  and  on  November 
22,  1918,  the  price-fixing  committee  notified  the  trade  that  there  was 
no  longer  any  necessity  for  putting  the  agreed  prices  into  effect.1 

Summary. — The  control  of  prices  in  the  hide  and  leather  industry 
began  with  the  control  undertaken  by  the  British  Government,  which 
was  first  instituted  in  December,  1916.  This  was  followed  by  cen- 
tral allied  purchasing  upon  the  part  of  all  the  allied  Governments 
even  before  the  United  States  entered  the  war,  and  was  afterwards 
continued  by  central  allied  purchasing  and  allotment.  Under  the 
British  control  of  importation  and  the  British  allotment  of  hides 
and  skins  and  leather  to  war  industries  prices  were  established 
first  upon  the  raw  hides  and  skins,  soon  after  upon  leather,  and  to 
a  considerable  extent  upon  leather  manufactures.  The  control  of 
hides  and  skins  prices  was  complete,  the  control  of  leather  prices 
extensive,  and  the  control  of  leather  manufactures  extended  to  shoes, 
both  Army  and  civilian,  and  all  other  items  of  leather  manufacture 
which  entered  into  British  and  other  Army  contracts. 

The  American  control  of  these  commodities  followed  in  general 
outline  the  methods  already  laid  down  by  the  control  exercised 
under  the  British  Government.  It  differed  mainly  in  that  the  neces- 
sity for  control  was  not  so  materially  apparent  in  America,  and  that 
the  control  over  leather  and  the  manufactures  of  leather  never  ex- 
tended far  beyond  the  field  of  Government  purchases. 

Indeed,  at  the  signing  of  the  armistice  price  fixing  had  not  ad- 
vanced beyond  raw  hides  and  skins  and  several  intermediate  products, 
such  as  sole,  belting,  and  harness  leather,2  and  even  the  maximum 

1  The  prices  adopted  were  based  on  a  6  per  cent  return  on  the  investment  of  the  tan- 
ners and  had  been  submitted  to  the  price-fixing  committee  by  the  hide  and  leather  section 
of  the  War  Industries  Board.     The  trade,  however,  objected  at  first  to  the  limitation  of 
their  profits  to  6  per  cent  and  contended  that  because  of  the  risks  entailed  due  to  unex- 
pected changes  in  style,  etc.,  they  were  entitled  to  at  least  8  per  cent.    This  return,  in  the 
opinion  of  the  price-fixing  committee,  was  much  too  large,  for  the  cost  data  submitted 
by  the  Federal  Trade  Commission  showed  a  turnover  of  2£  times  per  year  ;  and  on  such 
a  basis  a  return  of  8  per  cent  meant  an  annual  profit  of  20  per  cent.     The  figure  finally 
agreed  upon  (which  never  was  put  into  effect)  was  based  on.  a  6  per  cent  return. 

2  Had  the  war  continued,  an  elaborate  system  of  price  fixing  extending  not  only  down 
through  the  various  fabricated  products,  but  also  to  the  ultimate  consumers,  might  have 
been  put  into  effect.    The  plans  of  the  War  Industries  Board  provided  for  the  elimination 
of  all,  unnecessary  styles  and  the  establishment  of  a  system  of  price  classification  for  each 
grade  of  shoes.     Provision  was  also  made  for  a  system  of  manufacturers'  serial  numbers, 
which  would  have  enabled  purchasers  to  Etseertain  both  the  name  of  the  manufacturer  of 
any  shoe  and  the  price  at  which  such  shoe  ought  to  retail. 


324 


HISTORY    OF    PRICES    DURING   THE    WAR. 


prices  applied  to  these  were  never,  in  many  instances,  reached  on 
the  open  market.1 

MANILA  FIBERS  AND  HEMP. 

The  extraordinary  needs  of  the  United  States  Navy  and  the 
United  States  Shipping  Board  for  rope  and  cordage  of  all  varieties, 
made  significant  the  rise  in  the  price  of  manila  hemp  during  1917 
and  1918.  The  United  States  Government  by  the  middle  of  1918 
was  consuming  virtually  all  the  manila  rope  manufactured  in  the 
United  States,  and  as  our  demands  increased,  speculation  grew. 
Indeed,  our  entrance  into  the  war  stimulated  speculation  within  the 
trade  to  such  an  extent  that  by  June,  1917,  manila  hemp  was  selling 
for  24  cents  per  pound,  or  approximately  207  per  cent  above  the 
1913-14  level.  The  price  continued  to  rise  through  the  second  half 
of  1917  and  in  January,  1918,  reached  $0.2856. 

It  was  evident  that  this  condition  could  not  be  allowed  to  con- 
tinue, especially  in  view  of  the  growing  demands  of  our  new  mer- 
chant fleet,  and  in  late  March,  1918,  the  War  Trade  Board  undertook 
to  regulate  the  price  of  manila  hemp.  It  relied  upon  its  power  of 
controlling  exports  from  the  possessions  of  the  United  States  as 
the  machinery  for  enforcing  the  prices  adopted.  Manila  hemp  was, 
therefore,  placed  on  the  restricted  list,  and  after  March  31,  1918, 
no  shipments  from  the  Philippines,  either  to  the  United  States  or 
other  countries,  were  allowed  without  permits  or  licenses  from  the 
War  Trade  Board.  With  the  exports  of  manila  hemp  subject  to 
license  requirement,  it  was  relatively  simple  to  add  conditions  to  be 
met  before  an  export  license  could  be  secured.  One  condition  stipu- 
lated was  that  "  persons  desiring  to  ship  hemp  or  manila  fiber  from 
the  Philippine  Islands,  whether  to  the  United  States  or  elsewhere 
[had  to]  show  to  the  satisfaction  of  the  War  Trade  Board  or  its 
representative,  by  affidavit  or  otherwise,  that  the  hemp  or  manila 

i  This  was  especially  true  of  hides  mid  skins,  as  shown  in  the  following  table: 

Fixed  and  quoted  prices  of  cattle  hides. 

[Averages.] 


Packer. 

Country 

- 

] 

mportec 

Per 

Per 

Per 

Fixed 
price. 

Quoted 
price. 

cent 
quoted 
to 

Fixed 
price. 

Quoted 
price. 

cent 
quoted 
to 

Fixed 
price. 

Quoted 
price. 

cent 
quoted 
to 

fixed. 

fixed. 

fixed. 

1918. 

April.  ..              

$0.  2412 

$0.  2123 

88 

$0.1867 

$0.1550 

84 

$o.asoo 

$0.3198 

97 

May  June  and  July.  . 

.2912 

.2837 

97 

.2317 

.1855 

77 

.3300 

.3299 

100 

August,  September,  and  Oc- 
tober   

.  2688 

.2688 

100 

.2133 

.2096 

98 

.3270 

.3263 

100 

November  and  December  

.2588 

.  2588 

100 

.2108 

.2079 

99 

.3270 

.  3250 

99 

GOVERNMENT    CONTROL    OVER   PRICES.  325 

fiber  covered  by  the  application  for  a  shipping  permit  or  export 
license "  had  been  bought  at  a  certain  price  in  accordance  with  a 
schedule  prepared  by  the  War  Trade  Board.1  Moreover,  in  order 
that  the  price  of  fibers  might  be  controlled  after  they  were  landed  in 
the  United  States,  a  further  condition  was  added  requiring  the  con- 
signment of  all  such  shipments  to  the  Textile  Alliance  for  the  ac- 
count of  whomsoever  the  shipper  might  designate.2 

The  price  fixed  for  the  standard  grade  of  hemp  was  17  cents  per 
pound  f.  o.  b.  Manila,  or  about  25  cents  at  New  York.  This  price, 
though  slightly  lower  than  the  current  market  figure,  was  admittedly 
high.  It  was  made  high,  however,  in  order  not  too  seriously  to 
prejudice  the  interests  of  the  many  importers,  manufacturers,  and 
producers  by  a  "  precipitous  price  adjustment."3  It  was  to  remain 
in  effect  for  four  months.  As  the  end  of  that  period  approached, 
the  War  Trade  Board  asked  the  price  fixing  committee  to  take  over 
the  regulation  of  manila  fiber  and  hemp.4  A  lower  price  than  that 
fixed  in  March  was  recommended,  and  on  July  24,  1918,  the  price 
fixing  committee  fixed  a  price  of  14  cents  per  pound  for  grade 
"  I  Current "  manila  fiber  f .  o.  b.  Manila.  This  price  was  temporary, 
however,  since  there  had  not  been  time  to  secure  sufficient  basic  in- 
formation from  the  trade.  It  was  to  be  effective  until  August  31, 
before  which  time  further  details  relative  to  an  appropriate  price 
could  be  secured  from  the  Governor  General  of  the  Philippines  and 
the  various  consumers. 

Neither  the  fixing  of  the  price  of  these  fibers  nor  the  figure 
adopted  appear  to  have  pleased  the  native  growers,  for  immedi- 
ately complaints  were  heard.  Both  the  Philippine  Legislature  and 
the  agricultural  interests  asked  for  the  removal  of  price  control,  and 
to  their  requests  was  added  that  of  the  Governor  General.  Accord- 
ingly, when  the  time  for  the  expiration  of  the  fixed  fiber  prices  ap- 
proached, the  price  fixing  committee  decided  not  to  renew  them,  and 
on  August  31  manila  fiber  and  hemp  prices  expired  by  limitation. 

BURLAP. 

The  abnormally  high  price  of  burlap  resulting  from  the  flagrant 
speculation  which  took  place  in  1917  and  1918  in  India,  the  United 
Kingdom,  and  the  United  States,  led,  in  the  fall  of  1918,  to  an  order 

1  This  schedule,  which  used  as  a  base  the  price  of  grade  "  I  Current  "  manila  hemp,  is 
published  011  p.  705  of  this  volume.     Prices  were  fixed  for  the  various  types  of  fiber  both 
at  Manila  and  at  New  York. 

2  Exception  was  made,  however,  in  the  case  of  shipments  to  the  United  States  Govern- 
ment.    The  Textile  Alliance  in  turn  released  such  shipments  to  the  -ultimate  consignee 
only  upon  receipt  of  a  guaranty  that  all  regulations  governing  trading  in  hemp  in  the 
United  States  would  be  abided  by. 

2  See  minutes  of  price-fixing  committea,  July  24,  1918. 

*  The  Philippine  Islands  being  a  possession  of  the  United  States,  it  was  felt  that  the 
price-fixing  committee  had  authority  to  fix  prices  there. 


326 


HISTORY  OF   PRICES   DURING  THE   WAR. 


of  the  War  Trade  Board  which  prohibited  the  private  importation 
of  all  burlap  unless  under  order  of  the  War  Industries  Board.  Action 
Avas  also  taken  relative  to  the  lowering  of  the  price  of  burlap;  and 
the  members  of  the  trade,  anticipating  that  prices  would  be  decreased 
as  a  result  of  negotiations  entered  into  between  the  Governments  of 
the  United  States  and  Great  Britain,  entered  into  a  A^oluntary  agree- 
ment with  the  War  Industries  Board  whereby  the  price  of  40-inch, 

8-ounce  burlap  was  fixed  at 
Pacific  ports  at  13.6.1  Burlap- 
bag  prices  were  also  fixed  on 
the  above  basis  f.  o.  b.  factory 
plus  the  cost  of  manufacture 
and  a  margin  of  5  per  cent. 
This  agreement  applied  to  all 
contracts  entered  into  prior  to 
October  4,  1918,  and  expired 
shortly  after  the  signing  of  the 
armistice. 

LUMBER. 

Southern  yellow  pine. — The 
demand  for  OATer  a  billion  feet 
of  lumber  for  the  construction 
of  cantonments  confronted  us 
immediately  after  the  outbreak 
of  war.  Although  the  ultimate 
supply  of  structural  timber  in 
the  United  States  was  far  in 
excess  of  the  Government  re- 
quirements, the  prompt  de- 

Weighted    index    numbers    of    prices. — Liurn-        .  . 

ber ;  and  "All  commodities."— By  quarters,      livery     OI     SO     large     an     Order 

1913  to  1918.     (Average  quoted  prices,    threatened   to   put   an   unusual 

July,  1913,  to  June,  1914=100.) 

pressure   on   the   lumber   mills 

and  to  send  prices  quickly  upward.  The  brunt  of  this  heavy  order 
was  to  fall  on  the  southern  yellow-pine  mills,  for  the  southern 
pine  was  not  oflly  the  leading  construction  timber  in  times  of  peace, 
but  the  location  of  the  pine  forests  near  the  many  cantonments  in  tho 
South  and  West  gave  it  the  preference  over  the  distant  Douglas  fir 
of  the  Pacific  coast  and  over  the  scanty  stands  of  hemlock  and  east- 
ern spruce.  The  first  step  in  the  creation  of  our  war  machine  there- 
fore depended  upon  the  southern  pineries,  and  the  first  great  prob- 
lem of  price  fixing  arose  in  connection  with  that  species  of  lumber. 
The  Government  was  forced  to  commence  the  work  of  regulating 


1  Other  prices  which  were  fixed  for  various  weights  of  burlap  at  the  different  ports   will 
be  found  on  page  679. 


GOVERNMENT   CONTROL   OVER   PRICES.  327 

lumber  prices  by  the  very  necessities  of  the  hour — the  securing  of  the 
raw  materials  for  our  training  camps  without  delay.  It  was  evi- 
dent that  if  the  individual  contractors  each  attempted  to  secure  the 
lumber  needed  for  each  cantonment  in  the  open  market  through  the 
medium  of  the  various  middlemen  and  wholesalers,  lumber  prices 
would  shoot  upward  under  the  stimulus  of  this  exceptional  demand. 
The  rise  in  prices,  however,  would  have  been  the  lesser  evil.  The 
lumber  industry  is  intensely  competitive  and  the  thousands  of  mills 
would  have  bid  strenuously  against  each  other  to  secure  the  Gov- 
ernment business  with  the  result  that  the  cantonment  orders  would 
have  gravitated  to  the  largest  mills,  or  to  the  mills  offering  the  great- 
est price  concessions,  thus  giving  some  mills  more  orders  than  they 
could  fill  immediately  while  other  mills  had  no  Government  business 
at  all.  Thus  the  necessity  of  price  fixing  grew  out  of  the  need  of 
apportioning  orders  between  all  the  lumber  mills  in  accordance  with 
their  productive  capacity  and  their  proximity  to  the  cantonment 
sites. 

As  a  basis  of  price  fixing  nothing  short  of  pooling  of  the  entire 
southern  yellow  pine  industry  was  necessary,  and  the  committee  on 
lumber  appointed  by  Mr.  Baruch  in  April,  1917,  to  act  under  the 
Eaw  Materials  Division  of  the  Council  of  National  Defense  in- 
stinctively recognized  this  fact.  The  lumber  committee  at  once 
called  representatives  of  the  southern  pine  mills  to  Washington, 
and  at  the  instigation  of  the  lumber  committee  these  private  lumber 
men  went  home  to  form  emergency  lumber  bureaus  that  would  have 
power  to  represent  each  branch  of  the  southern  pine  industry. 
These  southern  pine  associations  were  quickly  organized  and  men 
empowered  to  represent  the  southern  pine  industry  almost  immedi- 
ately began  to  hold  conferences  with  the  lumber  committee  in  re- 
gard to  the  establishment  of  a  uniform  price  of  yellow  pine  lumber 
for  Government  cantonment  requirements.  Finally,  on  June  13, 
1917,  the  average  price  of  $20  a  thousand  board  feet  for  canton- 
ment stock,  which  was  equivalent  to  $23.20  for  the  run  of  the  mill, 
was  set  by  voluntary  agreement  between  the  Government  and  the 
lumber  men.  This  price  was  not  based  on  a  study  of  costs,  but, 
inasmuch  as  the  price  allowed  was  higher  than  the  market  price  of 
$17  a  thousand  which  prevailed  earlier  in  the  year,  it  was  believed 
by  representatives  of  the  Federal  Trade  Commission  to  allow  a  fair 
margin  to  cover  the  increasing  costs  of  producing  lumber.  By 
dealing  directly  with  the  industry  itself  the  Government  did  away 
entirely  with  the  interposition  of  middlemen  and  thus  saved  the 
wholesalers'  profit. 

Under  the  informal  price  agreement  52,000  carloads  of  southern 
yellow  pine  or  over  a  billion  feet  of  lumber  were  delivered  between 
June  15  and  September  15,  1917.  By  apportioning  orders  through 


328  HISTORY   OF   PRICES   DURING   THE    WAR. 

the  emergency  pine  bureaus  to  the  individual  mills  on  the  basis  of 
their  productive  capacity  and  proximity  to  each  cantonment  all  the 
the  mills  quickly  turned  out  the  quotas  assigned  to  them,  and  by 
fixing  the  same  price  for  all  the  mills  none  were  tempted  to  secure 
more  than  their  share  of  orders  by  cutting  prices.  A  voluntary 
reduction  of  from  50  cents  to  $1  a  thousand  board  feet  in  the  price 
of  southern  pine  was  made  on  September  11,  but  there  was  no 
further  price  fixing  until  the  appointment  of  the  price-fixing  com- 
mittee of  the  War  Industries  Board  in  March,  1918. 

The  effect  of  the  control  of  the  prices  of  southern  yellow  pine  was 
communicated  to  the  prices  of  other  woods,  such  as  Douglas  fir  and 
hemlock,  which  are  normally  used  for  the  same  purposes  and  which 
follow  the  lead  of  southern  yellow  pine  under  normal  market  con- 
ditions. Thus  the  direct  agreement  as  to  the  prices  of  southern  pine 
indirectly  brought  these  other  woods  under  the  influence  of  the  price- 
fixing  power  long  before  their  prices  were  formally  fixed. 

During  the  interval  between  the  informal  price  agreement  in  June, 

1917,  and  the  first  action  of  the  price-fixing  committee  in  March, 

1918,  prices  to  the  general  public  which  were  not  covered  by  the 
rtgreement  were  steadily  increasing  as  a  result  of  the  increasing  costs 
of  producing  lumber  until  in  May,  1918,  they  ranged  from  $5  to  $7 
a  thousand  higher  than  the  prices  paid  by  the  Government.     This 
disparity  in  prices  as  well  as  the  rising  costs  prompted  the  new  price- 
fixing  committee  of  the  War  Industries  Board  on  June  15,  1918,  to 
fix  a  new  price  for  southern  yellow  pine  of  $28  a  thousand  board 
feet,  applicable  to  both  Government  and  civilian  purchases,  which 
represented  an  increase  of  $4.80  over  the  price  first  set.     The  new 
price  was  based  on  a  cost  investigation  by  the  Federal  Trade  Com- 
mission and  was  lower  than  the  price  contended  for  by  the  lumber- 
men, Avho  claimed  that  the  value  of  stumpage  should  be  computed  at 
its  present  market  value  instead  of  at  its  original  cost. 

No  further  increase  in  the  prices  of  southern  yellow  pine  was 
allowed  by  the  price-fixing  committee  despite  the  fact  that  the 
constantly  increasing  cost  of  producing  lumber  made  the  prices  that 
went  into  effect  on  June  15,  1918,  less  and  less  profitable.  The  ques- 
tion as  to  advancing  the  prices  of  yellow  pine  was  discussed  when 
the  time  limit — September  15 — of  the  fixed  prices  was  reached,  but 
the  same  prices  were  ordered  to  be  continued  in  effect  until  December 
23.  The  reason  for  this  rigid  policy  was  to  be  found  in  the  desire 
of  the  Government  to  curtail  the  production  of  lumber,  after  the 
peak  of  Government  demand  had  been  satisfied.  By  the  latter  part 
of  1918  normal  building  operations  had  fallen  to  a  very  low  ebb, 
and  there  was  a  surplus  of  ordinary  building  materials  on  the 
market.  Consequently  there  was  no  necessity  for  stimulating  pro- 
duction by  offering  higher  prices;  on  the  contrary  it  was  necessary 


GOVERXMEXT    COXTROL   OVER   PRICES.  329 

to  release  part  of  the  labor  and  capital  employed  in  the  building- 
industries  by  curtailing  the  production  of  such  material.  One  means 
of  curtailing  production  was  to  keep  prices  fixed  below  the  cost  of 
production  of  some  of  the  marginal  mills,  and  thereby  to  cause  their 
withdrawal  from  production. 

Oilier  softwoods. — The  price  control  of  southern  yellow  pine  was 
the  dominating  feature  of  the  Government  price  fixing  of  lumber. 
While  the  price  of  southern  yellow  pine  can  not  be  regarded  as  the 
base  price  for  all  other  softwoods,  the  prices  of  other  woods  were 
nevertheless  closely  related  to  the  prices  of  that  major  species.  North 
Carolina  pine  is  but  a  trade  name  for  a  species  of  southern  yellow  pine 
and  its  fixed  price  conformed  closely  to  that  of  the  other  yellow  pines. 
The  price  of  Douglas  fir,  first  fixed  on  Marxh  19,  1918,  was  set  lower 
than  that  of  yellow  pine,  ranging  from  $10  a  thousand  for  No.  3  to 
$19  a  thousand  for  No.  1.  The  difference  in  the  fixed  prices  of  yellow 
pine  and  Douglas  fir  corresponds  to  the  differences  in  the  two  indus- 
tries. Douglas  fir  occurs  in  dense  stands  on  the  Pacific  coast  where 
its  supply  is  great — 760  billion  feet — and  its  demand  relatively  small 
in  the  locality  where  it  is  produced;  southern  pine  has  reached  its 
crest  and  is  waning  in  supply  while  the  demand  for  it  from  the 
nearby  centers  of  population  in  the  South,  East,  and  Middle  West  is 
constantly  increasing.  Douglas  fir  competes  on  even  terms .  with 
southern  pine  in  the  markets  of  the  Middle  West,  but  in  order  to  at- 
tain that  parity  it  must  pay  the  heavy  freight  charges  on  the  long 
haul  from  the  Pacific  coast  and  consequently  its  price  on  the  Pacific 
coast  is  lower  than  that  of  pine  in  the  Gulf  States.  The  cost  of  pro- 
ducing Douglas  fir  is  also  lower  than  that  of  southern  pine  because 
Douglas  fir  is  cut  by  large  mills  that  operate  in  tremendous  stands 
of  timber,  while  southern  pine  is  cut  by  smaller  mills  with  higher 
costs.  A  further  reason  for  the  relative  cheapness  of  Douglas  fir  as 
compared  with  southern  pine  during  the  war  is  to  be  found  in  the  high 
prices  paid  for  special  grades  of  Douglas  fir  for  ships  and  airplanes, 
which  entailed  the  production  of  a  large  "  side-cut "  which  could  be 
used  for  construction  purposes.  While  the  actual  price  of  Douglas 
fir  was  thus  lower  than  that  of  southern  pine,  however,  its  relative 
increase  in  price  over  the  prewar  level  was  even  greater  than  that 
of  its  rival. 

The  prices  of  Pennsylvania  hemlock,  first  fixed  on  May  9,  1918, 
conformed  closely  to  that  of  southern  pine  because  it  was  used  for 
the  same  general  purpose  of  construction.  Eastern  spruce,  which  is 
used  for  building  to  some  extent,  was  given  a  considerably  higher 
fixed  price  than  southern  pine.  Spruce  is  a  preferred  wood,  for 
many  purposes,  notably  for  paper  pulp,  and  its  price  as  a  building 
material  must  be  high  enough  to  equal  its  value  in  these  alternative 
uses.  The  car  shortage  during  1918  shut  out  southern  pine  from  the 


330  HISTORY    OF    PRICES    DURING   THE    WAR. 

Xew  York  market,  and  spruce  could  consequently  be  sold  for  general 
building  purposes  at  a  much  higher  price  than  that  fixed  for  pine. 
Western  spruce  was  in  great  demand  for  the  wings  and  beams  of 
airplanes,  but  the  quality  required  for  this  important  purpose  was  so 
high  that  only  about  10  per  cent  of  the  total  production  met  the 
tests.  Since  there  was  but  small  demand  for  the  "  side-cut "  it  was 
necessary  for  the  Government  to  pay  for  the  airplane  stock  at  a  rate 
that  would  make  the  cutting  of  the  wood  profitable,  even  although 
little  was  received  for  the  "  side-cut."  In  this  case,  the  Government 
stimulated  the  production  by  paying  a  relatively  high  price,  but  this 
was  an  exception  to  the  general  rule. 

Harckvoods. — The  number  of  species  of  hardwoods  is  so  great, 
the  conditions  of  production  between  the  various  species  and  even 
between  the  same  species  in  different  States  are  so  diverse  and  the 
special  uses  which  give  each  of  these  species  a  special  market  are 
so  varied  in  normal  times  that  there  is  no  consistent  price  structure 
between  the  hardwoods  as  there  is  in  the  case  of  softwoods  under 
the  leadership  of  Southern  yellow  pine.  The  Government  had  urg- 
ent need  of  certain  grades  of  some  hardwoods  for  specialized  war 
purposes,  and  it  bought  practically  the  entire  supply  of  these  choice 
grades.  Walnut  for  gunstocks  and  airplanes  was  the  premiere  wood 
of  the  war,  justly  called  the  "Liberty  tree";  mahogany  for  airplane 
propellers  was  an  important  supplement  to  walnut;  locust  for  tree- 
nails was  an  essential  for  wooden  ships,  while  ash  and  hickory  for 
handles  and  vehicles,  oak  for  airplane  propellers  and  artillery  wheels, 
and  birch  for  airplane  ply-wood  all  did  their  bit  in  the  military 
program.  The  Government  did  not  fix  the  price  for  any  of  these 
woods,  but  since  it  established  a  fixed  schedule  for  its  own  pur- 
chases, and  since  it  was  practically  the  sole  purchaser  in  the  case  of 
walnut,  locust,  and  mahoganj*,  its  action  virtually  amounted  to  price- 
fixing.  The  prices  paid  by  the  Government  for  these  special  grades 
were  relatively  high  in  order  to  cover  the  entire  cost  of  production, 
including  that  of  the  lower  grades  of  wood  for  which  there  was  no 
immediate  market  and  in  order  to  stimulate  the  production  of  vital 
war  material  to  the  maximum.  The  market  prices  of  the  lower 
grades  of  the  war  woods,  and  the  market  prices  of  woods  not 
used  in  the  war — in  sharp  contrast  to  the  prices  of  walnut,  mahogany, 
and  locust — were  low.  The  prices  of  hardwoods  in  general  did  not 
rise  as  rapidly  as  the  softwoods  or  as  the  prices  of  all  commodities. 
The  demand  for  furniture  and  for  other  wood  products  had  dwindled 
to  a  very  low  ebb  during  the  war,  and  hardwood  logs  that  were  cut 
as  a  by-product  of  other  logging  operations  were  constantly  sold 
at  relatively  low  prices.  In  view  of  the  peculiar  differences  that  exist 
between  hardwood  and  softwood  markets,  however,  the  difference 


GOVERNMENT    CONTROL    OVER   PRICES.  331 

in  the  prices  of  softwoods  and  hardwoods  can  not  be  attributed  to 
the  fact  that  the  prices  of  most  of  the  softwoods  were  fixed  while 
the  prices  of  the  hardwoods  were  uncontrolled. 

BUILDING  MATERIALS. 

Prices  of  the  basic  building  materials  were  fixed  during  the  war, 
but  the  scope  and  effect  of  price  control  varied  considerably  with  the 
different  building  materials.  The  price  of  the  lumber  that  was  used 
for  constructing  cantonments,  ships,  and  aeroplanes  to  the  extent 
of  20  per  cent  of  the  total  annual  production  was  controlled  by  the 
Government  from  the  beginning  to  the  end  of  the  war  for  most  of 
the  important  kinds  of  lumbers  and  for  both  Government  and  pri- 
vate purchases.  The  price  of  the  Portland  cement  that  was  an 
important  material  for  a  great  variety  of  construction  work  from 
Government  buildings  to  fortifications  and  even  ships  was  fixed  for 
Government  purchases  at  the  important  producing  centers.  The 
price  of  structural  steel,  in  common  with  all  other  kinds  of  that  vital 
war  material,  was  fixed  in  all  markets  by  the  Government.  The 
prices  of  other  building  materials  such  as  common  brick,  hollow 
building  tile,  sand,  gravel,  and  crushed  stone  were  controlled  only 
in  localities  where  there  was  a  large  volume  of  Government  con- 
struction work.  This  last-named  group  of  building  materials  was  in 
heavy  demand  only  in  the  congested  district  of  the  East,  and  the 
price  control  there  exercised  in  behalf  of  'Government  purchases  had 
only  an  influence  upon  local  prices.  The  prices  of  33  building  ma- 
terials that  consisted  of  partly  manufactured  products  of  the  basic 
building  materials  such  as  metal  lath,  metal-corner  beds,  etc.,  were 
not  directly  controlled  at  all. 

Price  fixing  in  the  field  of  building  materials  had  certain  distin- 
guishing characteristics  in  spite  of  the  wide  dissimilarity  in  the  com- 
modities composing  this  group.  These  attributes  of  price  control  in 
construction  materials  may  be  noted  under  four  main  heads.  The 
last  head  is  not  peculiar  to  building  materials. 

1.  The  prices  of  building  materials  were  not  fixed  at  a  level  that 
would  stimulate  production  but  rather  at  a  level  that  would  actually 
curtail  the  output  of  materials  for  construction.  Since  the  volume  of 
private  building  in  1918  had  dwindled  to  20  per  cent  of  its  normal 
physical  magnitude  and  since  the  combined  construction  program  of 
all  the  Government  departments  was  not  over  25  per  cent  of  the 
nation's  normal  building  operations  there  was  no  necessity  for  in- 
creasing the  production  of  the  raw  materials  for  building.  In  fact 
private  building  was  regarded  as  nonessential  during  the  war,  and 
every  effort  was  made  by  fuel  curtailments,  refusal  to  grant  priorities 
for  cars,  etc.,  to  discourage  normal  building.  The  result  of  these 
Government  restrictions  combined  with  the  high  prices  of  building 


332  HISTORY   OF   PRICES   DURING  THE   WAR. 

materials  was  to  reduce  the  demand  for  new  building  faster  than  the 
manufacturers  of  building  materials  could  curtail  production,  The 
Government  consequently  had  no  difficulty  in  securing  sufficient  sup- 
plies of  the  common  building  materials,  because  the  plant  capacity 
for  producing  these  was  far  in  excess  of  the  reduced  demand.  In 
fixing  prices  the  policy  was  accordingly  adopted  of  allowing  the  pro- 
ducers of  building  materials  such  a  price  as  would  yield  them  only  a 
normal  return  on  their  investment.  Where  the  normal  return  on  the 
investment  was  low  on  account  of  keen  competition — as  it  usually  was 
in  the  building  materials  industries — only  a  low  return  on  the  invest- 
ment was  allowed.  Thus  the  prices  fixed  on  common  brick  allowed  an 
average  net  return  of  only  8.76  per  cent,  and  the  cement  prices 
yielded  6  per  cent  on  the  investment.  It  also  happened  that  lumber 
prices  fixed  on  the  cost  of  production  of  March,  1918,  were  not  in- 
creased later  in  spite  of  advancing  labor  and  materials  costs.  The 
Government  thus  held  down  the  prices  of  building  materials  because 
the  production  was  in  excess  of  all  essential  war  needs,  and  it  was 
desirable  in  the  interests  of  war  conservation  to  enforce  a  price  so 
low  that  it  would  actually  close  down  the  marginal  plants.  The  effect 
of  this  low-price  policy  is  shown  by  the  fact  that  the  average  price  of 
lumber  and  the  average  price  of  cement  increased  only  73  per  cent 
between  1913  and  the  end  of  1918  as  contrasted  with  102  per  cent  for 
all  commodities. 

There  were  a  few  exceptions  to  the  policy  stated  in  the  foregoing 
paragraph.  Structural  steel  shared  the  high  prices  allowed  to  stimu- 
late steel  production,  but  nevertheless  the  use  of  structural  steel  was 
curtailed  wherever  possible  so  that  its  rise  in  price  was  due  entirely  to 
its  relation  to  other  steel  and  not  to  a  demand  for  it  for  building. 
The  prices  paid  by  the  Government  for  certain  rather  scarce  woods 
such  as  walnut,  mahogany,  locust,  etc.,  were  purposely  made  high  in 
order  to  stimulate  their  production. 

2.  Price  fixing  in  the  building  industries  had  for  one  of  its  main 
objects  the  stabilizing  of  the  industries.  Industries  producing  build- 
ing materials  were  accustomed  to  compete  most  strenously  within 
their  own  ranks  and  with  each  other.  Southern  pine  lumber  corn- 
batted  Douglas  fir  lumber,  hemlock,  and  spruce;  North  Carolina 
pine  competed  with  Georgia  and  Alabama  pine;  the  small  mill 
competed  with  the  larger  in  the  same  territory ;  while  all  the  lumber 
mills  fought  cement  and  brick.  This  price  competition  while  en- 
tirely satisfactory  to  the  consumer  in  times  of  peace  was  unsatis- 
factory to  the  Government  in  times  of  war,  because  it  meant  irregu- 
larity of  production,  delay  in  placing  orders  and  competition  be- 
tween Government  departments.  The  Government  always  preferred 
to  deal  with  one  central  body  representing  the  whole  trade  that 
could  guarantee  large  deliveries  and  allocate  the  orders  fairly  be- 


GOVERNMENT    CONTROL   OVER  PRICES.  333 

tween  its  members.  Only  by  fixing  a  stable  price  for  the  entire  in- 
dustry would  the  temptation  for  rival  mills  to  secure  business  by 
cutting  prices  be  entirely  avoided.  The  paramount  necessity  was 
to  secure  unity  of  action  among  the  trade  to  win  the  war  and  to 
avoid  the  wastes  and  delay  of  competitive  strife. 

The  result  of  the  price-fixing  policy  was  thus  to  solidify  industries. 
Every  important  building-material  group  patched  up  their  internal 
differences  for  the  time  being  and  appointed  a  war-service  com- 
mittee to  represent  the  entire  trade.  This  war-time  concentration 
will  leave  lasting  impressions.  The  rise  of  the  National  Lumber 
Manufacturers'  Association,  the  formation  of  an  association  of  brick 
manufacturers  can  be  directly  traced  to  the  war.  Price  stabilization 
inevitably  fosters  the  industrial  combination  that  is  necessary  to  sus- 
tain a  stable  price.  In  this  respect  price  fixing  of  building  materials 
was  no  different  from  price  fixing  in  any  other  field. 

3.  Not  withstanding  the  tendency  toward  a  uniform  price  policy, 
the  fixed  prices  of  building  materials  varied  more  from  one  locality 
to  another  than  almost  any  other  group  of  commodities.     While  the 
prices  of  lumber  and  steel  were  fixed  at  single  base  points,  the  prices 
of  sand,  gravel,  and  crushed  stone  were  fixed  differently  in  each  lo- 
cality, fixed  cement  prices  varied  at  40  different  producing  points, 
and  common  brick  prices  varied  in  the  16  zones  in  which  Government 
purchases  were  made.     These  variations  are  to  be  attributed  to  the 
fact  that  brick,  cement,  sand,  gravel,  and  crushed  stone  are  produced 
near  the  locality  where  they  are  consumed,  being  too  cheap  in  propor- 
tion to  their  bulk  to  be  transported  far.     Consequently  the  market 
for  these  bulky  articles  is  a  local  one  and  the  price  is  determined  by 
the  local  cost  of  production  and  the  local  demand.     In  fixing  prices 
each  producing  center  accordingly  had  to  be  separately  considered. 
This  was  especially  true  of  brick,  sand,  and  gravel.    While  cement 
prices  differed  considerably,  there  was  still  a  common  price  structure 
with  fixed  differentials. 

4.  A  common  result  of  price  fixing  is  standardization.     It  is  essen- 
tial in  fixing  a  uniform  price  that  the  grade  and  quality  upon  which 
the  price  is  fixed  does  not  vary,  for  otherwise  the  value  received  will 
vary  in  spite  of  the  fixed  price.    If  the  goods  are  not  already  stand- 
ardized, they  must  be  reduced  to  uniform  types  before  the  prices  can 
be  fixed.     Basic  raw  materials  are  usually  standardized  and  lumber, 
steel,  and  cement  were  already  gauged  by  certain  definite  mechanical 
tests.    The  sizes  and  quality  of  common    brick,    however,    varied 
greatly  and  one  of  the  causes  of  variation  in  brick  prices  was  the 
difference  in  size  and  quality.     The  act  of  fixing  the  prices  of  com- 
mon brick  stimulated  a  movement  toward  standardization  and  this 
may  be  one  of  the  lasting  results  of  fixing  the  price  of  bricks. 


334  HISTORY   OF   PRICES  DURING  THE   WAR. 

Portland  cement. — Portland  cement  ranked  next  in  importance  to 
lumber  as  a  war  building  material.  Its  use  in  armories,  barracks, 
gun  placements,  trencli  linings,  bomb-proof  shelter,  incinerators, 
munition  factory  buildings,  warehouses,  barges,  and  reinforced  con- 
crete ships  gave  cement  prominence  in  the  war  program  as  early  as 
April,  1917,  and  the  congestion  of  Government  orders  at  certain 
points  along  the  Atlantic  seaboard  threatened  to  cause  local  short- 
ages of  cement  and  sharp  rises  in  cement  prices,  in  the  districts  of 
heavy  Government  demand.  The  production  of  cement  for  the 
country  as  a  whole  was  ample  for  the  increased  requirements  of  war 
even  without  drawing  upon  the  excess  productive  capacity  of  the 
cement  mills.  In  fact  the  declining  consumption  of  cement  that 
resulted  from  the  curtailment  of  normal  building  operations  had 
more  than  offset  the  new  orders  from  the  Government.  Since  Port- 
land cement  is  a  bulky  commodity,  however,  it  is  not  profitable  to 
ship  it  far  from  the  mill,  and  since  the  limestone  and  coal  that  are 
the  chief  materials  used  in  its  manufacture  are  widely  distributed 
throughout  the  United  States,  conditions  have  been  favorable  for 
the  establishment  of  cement  mills  in  nearly  every  State.  Each  cement 
mill  thus  enjoys  a  local  monopoly,  the  radius  of  which  is  determined 
by  its  cost  of  production  and  by  the  proximity  of  other  mills.  The 
cement  mills  of  the  South  which  possess  an  abundant  supply  of  a 
limestone  almost  ideal  for  cement  making,  joined  to  a  cheap  supply 
of  coal,  can  produce  cheaper  and  send  their  product  farther  than  the 
mills  near  New  York  City,  which  possess  fewer  advantages  in  re- 
spect to  raw  materials.  Nevertheless  the  proximity  to  the  great 
centers  of  population  enables  the  mills  in  New  York  and  the  Lehigh 
district  in  Pennsylvania  to  offset  the  advantage  of  the  southern  mills 
and  allows  them  to  hold  the  markets  in  the  big  cities  against  their 
southern  rivals.  Thus  the  cement  industry  is  split  up  into  many 
local  markets  which  are  connected  by  a  series  of  price  differentials, 
but  which  nevertheless  enjoy  a  large  measure  of  independence.  It 
is  therefore  possible  for  local  shortages  of  cement  to  exist  in  some 
communities,  notwithstanding  the  existence  of  an  oversupply  in 
other  communities,  and  this  is  particularly  true  when  the  tremendous 
concentration  of  war  goods  pouring  towards  the  Atlantic  seaboard 
strained  the  normal  means  of  transportation  and  put  an  embargo  on 
bulky  goods.  To  secure  an  adequate  supply  of  cement  for  the  Gov- 
ernment it  was  therefore  necessary  to  allocate  the  supply  and  to  fix 
the  prices  at  the  points  of  congestion. 

The  Portland  cement  industry  had  a  large  degree  of  cohesion  be- 
fore the  war  for  the  purpose  of  pushing  the  sale  of  cement  in  com- 
petition with  lumber,  brick,  and  stone,  although  the  price  competition 
between  the  various  cement  mills  had  bordered  on  the  cut-throat  va- 
riety. This  organization  nevertheless  facilitated  the  quick  appoint- 


GOVERNMENT   CONTROL   OVER   PRICES.  335 

ment  of  a  "  cooperative  committee  on  cement "  under  the  Council  of 
National  Defense  on  April  21,  1917.  This  committee,  composed  of 
representatives  of  the  industry  and  of  the  Government  at  once  began 
to  act  as  a  clearing  house  for  assembling  trade  information  prepara- 
tory to  advising  the  committee  on  raw  materials  of  the  Council  of 
National  Defense  as  to  available  supplies  and  prices  of  cement. 
While  this  committee  was  acting,  many  purchases  of  cement  were 
made  by  the  Army  and  the  Navy  at  no  definite  price,  but  with  the 
understanding  that  a  fair  price  was  to  be  fixed  later.  On  December 
18,  1917,  the  first  committee  was  dissolved  and  a  war  service  com- 
mittee on  Portland  cement  was  organized.  No  prices  were  fixed, 
however,  until  the  price-fixing  committee  in  April  and  May,  1918, 
after  an  investigation  of  costs  by  the  Federal  Trade  Commission 
fixed  prices  for  the  Army  and  Navy  purchases  for  the  six-months' 
period  ending  December  31,  1917,  the  four-month  period  ending 
April  30,  1918,  and  the  four-month  period  ending  August  31,  1918. 
Later  on,  August  23,  1918,  the  price-fixing  committee  established 
prices  for  the  four  months  ending  December  31,  1918.  .  The  prices 
set  for  1917  applied  only  to  Army  and  Navy  purchases  and  they 
became  effective  when  accepted  by  the  industry  and  the  purchasing 
departments.  This  first  price  list,  which  has  a  retroactive  effect, 
covered  30  different  producing  points,  and  the  prices  varied  from 
$1.30  a  barrel  in  Texas  to  $1.90  a  barrel  in  California.  The  second 
price  list  applying  to  all  Government  purchases  for  the  first  four 
months  of  1918  was  the  same  as  the  first.  The  third  set  of  fixed 
prices  for  the  four  months  ending  August  31,  1918,  marked  an  ad- 
vance of  as  high  as  45  cents  a  barrel  for  the  low-cost  mills,  dropped 
prices  on  some  of  the  high-cost  mills  in  the  Pacific  coast  States, 
and  reduced  the  maximum  variation  in  cement  prices  to  35  cents  a 
barrel  and  the  average  variation  to  about  20  cents  a  barrel.  The 
fourth  price  list  for  the  four  months  ending  December  31  was  virtu- 
ally the  same  as  the  third  price  list,  except  that  the  prices  did  not 
include  bin  inspection  and  a  reduction  of  3  cents  a  barrel  was  made 
for  the  value  of  that  service. 

The  chief  results  of  the  price  fixing  of  cement  were  to  prevent  a 
rise  in  price  at  a  few  congested  points  along  the  Atlantic  seaboard 
and  to  facilitate  the  prompt  delivery  of  cement  011  Government  or- 
ders by  eliminating  price  cutting  with  its  attendant  waste,  confusion, 
and  irregular  production.  The  main  current  of  cement  prices 
throughout  the  country  as  a  whole  was  not  substantially  affected. 
Only  11,813,076  barrels  of  cement  were  allocated  at  this  fixed  price 
during  1917  and  1918  out  of  a  total  production  of  92,814,202  barrels 
in  1917  and  71,632,000  barrels  in  1918. 

The  price  of  Portland  cement  to  the  general  public  was  never 
fixed,  and  this  ranged  about  30  cents  a  barrel  higher  than  the  price 


336  HISTORY    OF   PRICES   DURING   THE   WAR. 

fixed  to  the  Government.  Price  fixing  leveled  up  market  prices 
to  some  extent  thereby  giving  the  low-cost  mills  large  profits,  while 
limiting  the  marginal  mills  to  a  low  return.  The  concentration  of 
production  at  the  largest  mills  equipped  with  the  most  modern 
machinery  would  have  enabled  the  Government  to  have  fixed  ce- 
ment prices  at  a  lower  level,  but  the  pooling  necessary  to  bring  this 
about  involved  too  many  practical  administrative  difficulties  to  jus- 
tify the  adoption  of  this  policy.  The  prices  fixed  in  1917  yielded 
the  cement  industry  as  a  whole  12  per  cent  on  its  investment,  and 
of  course  individual  mills  reaped  a  much  higher  rate,  but  subse- 
quent price  fixing  reduced  this  margin  to  6  per  cent  merely  by 
maintaining  the  status  quo  in  the  face  of  advancing  costs.  The 
general  supply  of  cement  was  so  ample,  as  compared  with  needs, 
that  the  Fuel  Administration  on  April  13,  1918,  reduced  the  fuel 
allotment  of  the  cement  mills  to  75  per  cent  of  normal  on  the  theory 
that  part  of  the  fuel  used  in  the  cement  industry  could  be  better 
employed  in  other  war  industries.  There  was  consequently  no  oc- 
casion for  stimulating  cement  production  by  high  prices,  and  the 
lowering  of  the  margin  of  profit  for  the  purpose  of  curtailing  pro- 
duction was  entirely  justified.  Cement  prices  rose  in  the  open 
market  less  than  any  other  basic  building  material  during  the  war, 
and  the  reason  for  price  fixing  in  the  field  of  cement  is  to  be  found 
in  the  desire  of  the  Government  to  prevent  the  stimulation  of  prices 
which  its  own  large  demand  would  normally  have  caused  in  certain 
congested  building  areas. 

Common  brick. — The  markets  for  common  brick  are  confined  to 
points  near  the  localities  where  brick  is  made,  and  consequently 
questions  of  supply  and  prices  vary  in  the  different  localities.  The 
demand  for  common  brick  for  both  Government  and  civilian  use 
during  the  war  declined  to  probably  one- fourth  of  normal,  or  to 
a  greater  extent  than  was  the  case  of  other  building  materials  except 
stone.  A  shortage  developed,  however,  in  a  few  of  the  large  eastern 
cities  in  the  congested  building  districts,  and  prices  for  brick  were 
there  established  on  all  Government  orders.  The  price  of  common 
brick  in  New  York,  Philadelphia,  Baltimore,  and  Washington  was 
the  first  to  be  formulated ;  the  other  prices  were  not  announced  until 
after  the  armistice,  but  they  had  a  retroactive  effect  and  applied  to 
all  purchases  made  at  tentative  prices.  Prices  fixed  by  the  Govern- 
ment for  light-burned  common  brick  varied  from  $9  a  thousand 
brick  in  Chicago  to  $15.50  a  thousand  brick  in  Philadelphia.  These 
differences  were,  in  some  instances,  due  to  variation  in  the  size  and 
quality  of  the  brick,  but  in  most  cases  they  were  due  to  differences 
in  the  local  market.  Thus  the  supply  of  brick  in  New  York  average 
a  price  of  $9.50  per  thousand,  which  was  originally  fixed  for  the 
period  ending  October  31,  1918,  for  the  accumulated  stock  left  over 


GOVERNMENT    CONTROL    OVER    PRICES.  337 

from  1917,  which  had  been  produced  011  the  lower  1917  level  of  cost. 
The  Philadelphia  brick  of  the  same  general  type  was  fixed  at  $6 
per  thousand  higher  in  price  because  the  Philadelphia  brick  was 
produced  during  1918  when  labor  was  high,  due  to  the  competition 
of  the  shipyards.  The  Philadelphia  brick  was  also  larger  in  size 
and  of  somewhat  better  quality  than  the  New  York  brick,  but  this 
does  not  fully  account  for  the  difference.  It  is  probable  also  that  a 
larger  marginal  profit  was  allowed  the  Philadelphia  brick  producers 
than  to  the  New  York  brick  men;  for  the  price-fixing  committee  in 
general  adopted  the  policy  of  fixing  prices  so  that  producers  would 
receive  their  prewar  level  of  profit.  The  profits  of  the  New  York  / 
brick  makers  were  very  low  before  the  war  because  of  the  keen  com- 
petition of  the  brick  men  along  the  Hudson  Eiver.  The  price-fixing  j 
committee  allowed  the  brick  men,  as  a  whole,  only  3.76  per  cent  on 
their  investment.  The  effect  of  Government  price  fixing  on  brick 
was  to  enable  the  Government  to  purchase  brick  at  slightly  below 
the  market  price  during  the  latter  part  of  1918  in  the  congested  dis- 
tricts of  New  York  and  Philadelphia.  Common  brick  prices  rose 
very  rapidly  in  the  open  market  during  the  latter  part  of  1918.  The 
price  fixed  for  Government  purchases,  while  about  equal  to  the  mar- 
ket prices  when  originally  fixed,  were  considerably  below  the  market 
by  tlie  end  of  the  year.  Thus  in  New  York,  where  the  price  fixed  for 
Government  purchases  on  light-burned  brick  was  $9.50  per  thousand 
beginning  July  1,  1918,  which  was  subsequently  raised  to  $10.50  per 
thousand  beginning  November  1,  the  market  price  roso  from  $12.50 
in  July  to  $18  in  December. 

Government  price  fixing  exerted  a  definite  influence  only  in  the  big 
eastern  cities.  Only  108,312,229  brick  were  allocated  at  Government 
fixed  prices  out  of  a  total  production  of  5,864,909,000  in  1917,  and 
about  2J  billion  in  1918.  The  amount  of  Government  purchases  were 
thus  small  in  comparison  to  the  total  common  brick  output,  and  as 
brick  sold  to  the  public  were  delivered  at  market  prices,  Government 
price  fixing  had  no  appreciable  effect  on  the  average  prices  of  brick 
throughout  the  country. 

Price  fixing,  even  in  the  case  of  brick,  however,  had  a  tendency  to 
bring  out  some  degree  of  combination  within  the  industry.  An  asso- 
ciation of  common  brick  manufacturers  was  formed  on  July  26,  1918, 
which  comprised  manufacturers  producing  about  1J  billion  brick 
annually,  or  about  20  per  cent  of  the  normal  production.  An  influ- 
ence also  was  exerted  in  favor  of  standardization  of  brick  in  the 
different  localities ;  this,  too,  is  an  evidence  of  concentration,  but  on 
the  whole  the  brick  industry  still  remained  highly  competitive  and 
disorganized.  A  nation-wide  control  over  prices  was  therefore  less 
effective  than  in  the  case  of  cement,  but  since  brick  was  of  rather 

125547°— 20 22 


338  HISTORY    OF   PRICES    DURING   THE    WAR. 

slight  importance,  however,  in  the  war  program  this  price  control  was 
also  less  necessary  here  than  elsewhere. 

Hollow  building  tile. — Hollow  building  tile  is  also  a  local  product 
whose  use  greatly  diminished  during  the  war.  Prices  were,  notwith- 
standing, fixed  at  the  principal  producing  points  for  the  176,703  tons 
of  hollow  building  tile  used  by  the  Government.  Prices  were  first 
fixed  for  the  period  ending  July  1,  1918,  and  they  were  later  ad- 
vanced to  cover  Government  purchases  made  from  July  1,  1918,  to 
the  period  ending  December  31,  1918. 

Gypsum  ic all  board  and  platter  board. — The  Government  require- 
ments for  gypsum  wall  board  and  plaster  board  during  the  war  were 
100  per  cent  over  the  capacity  of  the  plants,  and  it  was  necessary  to 
take  over  the  entire  output  of  these  materials  for  Government  use 
and  to  authorize  plant  extensions.  It  also  became  necessary  to 
allocate  orders  for  Government  requirements,  and  pending  the  estab- 
lishment of  a  fixed  price  the  orders  were  allocated  at  tentative  prices. 
On  February  27,  1919,  the  price-fixing  committee  established  maxi- 
mum f .  o.  b.  mill  prices  for  wall  board  for  two  firms  at  Chicago  and 
for  two  firms  at  Los  Angeles,  and  maximum  f .  o.  b.  mill  prices  for 
plaster  board  at  Chicago.  New  York,  Buffalo,  Hampton,  Va.,  Passaic, 
X.  J.,  Fort  Dodge,  Iowa,  and  East  Newark,  N.  J.  Since  the  total 
production  of  wall  board  and  plaster  board  comprised  only  10  per 
cent  of  the  total  value  of  gypsum  products,  price  fixing  of  these  two 
products  had  no  pronounced  efl'ect  on  the  price  of  raw  gypsum. 
Allocations  to  the  amount  of  52,121,060  square  feet  of  wall  board  and 
plaster  board  and  to  the  value  of  $956.323  were  made  at  the  fixed 
prices. 

Sanid,  gravel,  and  crushed  stone. — Sand,  gravel,  and  crushed  stone 
are  consumed  near  the  localities  where  they  are  produced.  During 
the  war  there  was  an  acute  shortage  of  these  materials  in  the  con- 
gested district  of  the  East,  and  it  became  necessary  to  fix  the  price 
and  allocate  orders  in  the  Philadelphia,  New  York,  Baltimore,  Wash- 
ington, and  Norfolk  districts.  A  total  of  2,949,879  tons  of  sand, 
gravel,  and  crushed  stone,  valued  at  $3,009,573,  was  allocated  at  the 
fixed  prices.  The  exact  prices  fixed  on  each  order  in  each  district  are 
shown  in  the  appendix. 

CHEMICALS. 

Nitrate  of  soda. — Before  the  war  virtually  all  of  our  nitrate  im- 
ports were  devoted  to  the  production  of  fertilizers,  and  our  needs  in 
1913  equaled  more  than  625,000  tons.  With  the  outbreak  of  the 
European  War  and  the  placing  of  munition  orders  with  American 
manufacturers,  our  requirements  for  nitrates  increased  considerably, 
and  by  1916  our  imports  of  nitrate  of  soda  had  grown  to  1,218,423 
pounds,  an  increase  of  almost  100  per  cent.  The  Chilean  market,  of 


CONTROL  OVER  PRICES.  339 

course,  felt  the  effects  of  the  stimulated  demand  following  the 
declaration  of  hostilities,  and  the  price  of  nitrate  of  soda  rose  con- 
siderably.1 It  was  not  until  after  the  United  States  entered  the  war, 
however,  when  the  War  Department  had  begun  actively  to  compete 
in  the  Chilean  market  against  both  American  private  buyers  and  the 
representatives  of  the  allied  Governments,  that  prices  really  soared. 
In  September,  1917,  accordingly,  nitrate  prices  were  more  than  twice 
the  average  for  1913-14. 

The  importance  of  nitrates  to  the  war  program,  however,  made 
essential  the  elimination  of  any  haphazard  competitive  system  of 
purchasing.  Accordingly,  in  October,  1917,  the  Allied  Governments 
began  negotiating  with  the  Chilean  producers  in  the  hope  of  securing 
an  adequate  supply  of  nitrates  at  a  price  more  reasonable  than  was 
then  being  paid.  These  negotiations  were  consummated  on  Decem- 
ber 10,  1917,  and  resulted  in  the  Allied  Governments  securing  a  vir- 
tual monopoly  over  the  output  of  Chilean  nitrates.  A  nitrate  execu- 
tive was  appointed  by  the  Allies  with  headquarters  in  London,  and 
all  purchases  of  nitrate  of  soda  in  Chile  for  the  various  belligerents 
were  concentrated  in  his  hands.  It  was  only  through  this  nitrate 
executive  that  the  various  Governments  could  secure  supplies  by  allo- 
cations made  only  on  the  basis  of  minimum  requirements.2 

Prior  to  the  American  entry  into  the  war  virtually  all  of  the 
nitrate  of  soda  brought  into  the  United  States  was  imported  by 
four  firms  who  controlled  to  a  large  degree  the  American  sales  of 
this  commodity.  The  machinery  for  nitrate  distribution,  then,  was 
highly  concentrated,  and  it  was  but  logical  that  so  far  as  possible  it 
should  be  kept  intact.  Accordingly,  it  was  arranged  by  the  War 
Industries  Board  that  these  importing  firms  purchase  the  total 
amount  of  nitrate  of  soda  allocated  to  the  United  States  by  the 
nitrate  executive,  and  continue  its  distribution  as  in  normal 
times.  It  was  necessary  from  the  beginning,  however,  to  distinguish 
between  the  two  types  of  American  demand.  First,  there  w-ere  the 
military  needs  which  the  importers  agreed  to  supply  at  actual  cost 3 
plus  a  nominal  expense  fee.  And,  second,  there  were  the  requirements 
of  the  fertilizer  manufacturers  and  of  other  civilian  nitrate  users. 

1  Nitrate  of  soda  sold  for  $3.60  per  hundredweight  in  February,   1916,  an  increase  of 
56  per  cent  over  its  prewar  average. 

2  The  estimated  minimum  requirements  for  the  United  States  for  the  year  1918  were 
as  follows  : 

Tons. 

For  munitions 1,  100,  000 

For  chemicals 215,  000 

For  commercial  explosives 185,000 

For  fertilizers  and  the  Department  of  Agriculture 300,000 


Total 1,  800,  000 

sThe  cost  of  the  nitrate  delivered  was  to  be  an  average  price  based  upon  the  receipts 
for  each  month. 


340  HISTORY   OF   PRICES   DURING   THE   WAR. 

To  these  consumers  the  importers  were  to  distribute  only  such 
amounts  of  nitrate  as  were  allocated  by  the  War  Industries  Board,1 
and  for  their  services  they  were  paid  a  commission  of  2J  per  cent 
over  the  cost  of  their  product  landed  in  the  United  States.  The 
War  Industries  Board,  on  the  other  hand,  stipulated  that  they  would 
allow  no  concerns  other  than  the  four  which  entered  into  this  agree- 
ment to  import  any  nitrates  into  this  country.  In  order  that  an 
equal  price  might  result  for  all  buyers  the  Shipping  Board  estab- 
lished a  uniform  shipping  rate  from  Chile  to  the  United  States. 
Furthermore,  the  War  Industries  Board  made  arrangements  for  the 
shipping  of  the  necessary  coal,  fuel,  oil,  etc.,  required  for  the  manu- 
facture of  nitrate  of  soda,  and  in  this  way  a  steady  output  was  as- 
sured, while  at  the  same  time  any  manipulation  of  prices  by  Chilean 
speculators  under  the  claim  of  ostensible  high  costs  was  eliminated. 

The  first  deliveries  under  this  pool  arrangement  were  made  in  Jan- 
uary, 1918.  It  soon  became  apparent  that  the  control  over  the 
whole  nitrate  situation  in  the  United  States  w^ould  require  some 
supervising  body,  for  the  supervision  of  distribution,  the  fixing 
of  pool  prices  and  the  clearance  of  all  contracts  covering  the  imports 
and  sales  of  the  approved  importers  were  matters  too  vital  to  the 
war  program  to  be  left  unregulated.  For  this  purpose  the  nitrate 
commission  of  the  United  States,  a  body  made  up  of  representa- 
tives of  the  four  approved  nitrate  importers  and  a  representative 
of  the  War  Industries  Board,  was  created.  Their  main  function, 
however,  soon  developed  into  the  control  of  nitrate  prices.  The 
nitrate  executive  at  London  determined  each  month  an  average  pool 
price  and  on  the  basis  of  this  figure  the  average  monthly  price  in 
Chile  for  the  United  States  purchasers,  was  computed.  Consider- 
able difference,  of  course,  still  existed  between  this  Chilean  price 
and  the  price  of  nitrates  delivered  in  the  United  States;  for  there 
were  many  charges  such  as  hauling,  freight,  insurance,  exchange, 
and  the  like,  which  had  to  be  added.  And  it  was  the  determination 
of  this  final  landed  price  that  formed  the  greater  part  of  the  task 
set  before  the  nitrate  commission.2 

From  the  point  of  view  of  its  primary  purpose  the  plan  of  nitrate 
control  was  successful  as  is  evidenced  by  the  fact  that  during  the 

1  The  amount  of  nitrates  to  be  purchased  for  distribution  to   civilian  consumers  was 
limited  however,  to  an  amount  equal  to  their  total  imports  for  the  calendar  year  1913. 
From  this  amount  were  deducted  such  stocks  as  had  been  purchased  in  1917  and  which 
had  not  been  shipped  from  Chile  prior  to  the  beginning  of  1918. 

2  This  landed  pool  price  varied  from  $4.10  per  100  pounds  in  May  to  $4.55  in  December. 
For  the  first  four  months  of  1918  no  definite  pool   price  was  determined   and   tentative 
figures  of  $4.25  and  $4.35  per  100  pounds  wore  used  for  billing  purposes.      It  should  be 
stated   that   these   prices  were  not   exact  and  were  based   on   the   figures   available  from 
bills  and  vouchers.     Tentative  monthly  prices  were  usually  made  and  when  all  necessary 
figures   became   available,    the   nitrate    commission    arranged    for   actual    prices   and    saw 
to  it  that  the  importers  made  adjustments   with  their  customers  on   the  basis  of  these 
final  prices. 


GOVERNMENT   CONTROL   OVER  PRICES.  341 

entire  period  of  the  war  all  needed  nitrate  was  secured.1  That  the 
price  was  strictly  controlled  at  the  lowest  possible  minimum  seems 
also  beyond  doubt. 

Heavy  acids. — Sulphuric  acid:  Arrangements  were  made  by  the 
Army  and  Navy  with  the  manufacturers  of  heavy  acids  late  in  1917 
relative  to  the  prices  to  be  paid  by  the  United  States  Government 
for  acid  supplies.2  There  Avas  no  instance  of  price  fixing,  strictly 
speaking,  in  the  acid  industry  until  the  summer  of  1918.  The  agreed 
prices  of  late  1917,  which  applied  to  the  governmental  purchases  of 
H2SO4  were  contract  prices  only  and  may  be  considered  in  a  measure 
similar  to  any  other  long-time  commercial  contract. 

It  appears,  however,  that  there  was  some  doubt  in  the  minds  of 
the  Government  authorities  as  to  the  advantages  derived  from  the 
agreed  sulphuric  acid  price,  and  in  early  1918  they  instructed  the 
Federal  Trade  Commission  to  look  into  the  cost  of  producing  acid 
in  this  country.  The  result  of  this  investigation  showed  a  great  di- 
vergence in  costs  between  the  several  types  of  producing  plants,  and 
it  was  apparent  that  no  price  could  be  fixed  which  would  limit  the 
returns  to  all  producers  within  the  same  bounds.  There  were,  for 
example,  the  high-cost  chamber-process  producers,  upon  whom  the 
Government  was  dependent  for  1,000,000  tons  of  sulphuric  acid  in 
1918.  Secondly,  there  were  those  manufacturers  who  obtained  their 
sulphur  as  a  by-product  from  the  smelting  of  zinc  and  copper  ores. 
And  finally  there  were  the  low-priced  producers  who  used  the  mod- 
ern contact  process  to  produce  their  sulphuric  acid.  The  large  varia- 
tion in  the  costs  of  these  three  types  of  producers,  upon  all  of  whom 
the  Government  was  dependent  for  its  supplies,  made  it  evident  that 
a  price  which  would  give  the  chamber-process  manufacturers  a  mod- 
erate profit  would  result  in  an  abnormally  high  return  to  the  con- 
tact producers.  The  solution  first  considered  was  a  series  of  indi- 
vidual prices  to  be  applied  to  the  products  of  plants  in  accordance 
with  the  process  used  in  the  manufacture  of  sulphuric  acid,  but  this 
finally  was  deemed  impracticable.  The  possibility  of  commandeer- 
ing was  considered  and  dismissed  because  of  difficulties  involved,  and 
the  fact  that  the  military  needs  were  hardly  large  enough  to  war- 

1  Mr.  B.  M.  Baruch,  chairman  of  the  War  Industries  Board,  in  a  statement  pub- 
lished in  the  Federal  Trade  Information  Service  of  Dec.  24,  1018,  says  that  there  was  no 
halting  at  any  time  during  the  war  in  the  manufacture  of  war  materials  which  depended 
upon  nitrates. 

-  As  a  result  of  the  negotiations  entered  into  between  the  military  authorities  and 
1he  manufacturers  of  sulphuric  acid,  the  price  of  sulphuric  acid  to  the  Government  was 
fixed  for  the  first  and  second  quarters  of  1018  as  follows  : 

Per    ton. 

GO0  B $18 

66°  B 30 

20°  oleum 35 

These  prices  did  not  apply  to  purchases  made  by  subcontractors  for  explosive  con- 
tracts for  the  United  States  or  its  Allies. 


342  HISTORY  or  PRICES  DURING  THE  WAR. 

rant  such  action.  Moreover,  it  was  quite  evident  that  the  total 
needs  of  the  country  necessitated  the  stimulation  of  the  productive 
capacity  of  the  country  in  every  possible  way,  and  this  meant  the 
establishment  of  "  fair  and  full  prices,"  provision  for  heavy  plant 
depreciation  and  the  obtaining  of  the  fullest  possible  output  from 
the  highest  cost  producers.1 

Accordingly,  a  system  of  price  fixing  was  decided  upon  which 
allowed  a  uniform  price  to  all  consumers,  governmental  and  civilian 
alike.  It  was  believed  that  the  excess-profits  tax  would  lead  to  a 
leveling  in  the  returns  of  various  producers. 

On  June  26,  1918,  the  acid  producers  met  with  the  price-fixing 
committee  to  help  determine  upon  a  fixed  price  for  their  products. 
The  negotiations  resulted  in  the  fixing  of  the  price  of  60°  B.  sul- 
phuric acid  at  the  same  figure  which  the  Army  and  Navy  were 
paying  for  their  supply,  namely,  $18  per  ton.2  This  price  was  con- 
siderably lower  than  the  current  market  price  and  meant  a  reduc- 
tion of  $7  per  ton  to  the  civilian  consumer.  With  this  price  as  a 
basis,  the  price  for  66°  B.  was  fixed  at  $28  per  ton,  a  decrease  of  $2 
from  the  former  Government  contract  price.3  Similarly,  the  price 
of  20  per  cent  oleum,  a  highly  concentrated  form  of  sulphuric  acid, 
was  fixed  at  $32  per  ton,  which  was  $3  less  than  the  agreed  price  of 
late  1917.  These  prices  were  to  remain  in  effect  for  90  days,  with 
the  United  States  Government  having  first  call  upon  the  entire  out- 
put of  the  country  or  any  part  thereof  which  it  required. 

Even  these  prices,  however,  do  not  appear  to  have  been  as  low 
as  the  cost  of  producing  sulphuric  acid  seems  to  have  warranted, 
and  by  the  end  of  the  summer  of  1918  the  chemical  section  of  the 
War  Industries  Board  asked  for  the  further  lowering  of  the  agreed 
prices.  These  prices  were  to  expire  at  the  end  of  September,  and 
on  the  26th  of  that  month  the  producers  of  sulphuric  acid  appeared 
before  the  price-fixing  committee  to  ask  for  a  continuation  of  the 
June  26th  price.  The  price-fixing  committee,  on  the  recommenda- 
tion of  the  chemical  section,  refused  this  request  and  recommended 
instead  a  series  of  prices  which  ranged  from  $2  to  $4  lower  than 

1  The  problems  which  faced  the  chemical  section  of  the  War  Industries  Board  when 
they  attempted  to  determine  upon  the  method  of  acid  price  fixing  to  be  adopted,  are 
fully  described  in  the  final  reports  of  the  acids  and  heavy  chemicals  section  of  the  War 
Industries  Board,  1910. 

2 This  pi-ice  was  supposed  to  yield  a  fair  profit  to  the  high-cost,  producers;  i.  e.,  manu- 
fnrturers  who  used  the  chamber  process. 

3  This  price  was  .$7  a  ton  lower  than  the  figure  currently  quoted  on  the  market 
and  when  compared  to  the  spot  quotations  of  two  months  previous  meant  a  decrease  of 
$17  per  ton.  The  price  for  66°  B.  acid  was  determined  by  adding  to  the  price  of  th» 
60°  acid  a  differential  which  covered  both  the  large  percentage  of  acidity  in  the  higher 
strength  acid  and  the  cost  of  concentration. 


GOVERNMENT   CONTROL  OVER  PRICES.  343 

f 

those  then  prevailing.  There  was  no  longer  the  fear  of  losing  the  out- 
put of  the  high-cost  producers.  It  was  the  opinion  of  those  in  charge 
of  the  military  requirements  that  the  extra  supply  secured  for  muni- 
tions by  the  curtailment  of  many  nonessential  industries  and  the 
output  of  the  numerous  new  Government  plants  would  be  more  than 
sufficient  to  offset  any  such  loss.  Moreover,  the  figures  of  the  Fed- 
eral Trade  Commission  showed  that  the  cost  of  producing  66°  B. 
Sulphuric  acid  during  the  first  six  months  of  1918  had  varied  from  $15 
to  $16  per  ton.1  while  the  price  fixed  was  $28  per  ton.  Indeed,  the 
chemical  section  had  recommended  that  in  default  of  a  lower  price 
on  sulphuric  acid,  "  serious  consideration  should  be  given  to  the 
advisability  of  commandeering  the  output  of  the  contact  acid  plants  " 
before  the  end  of  the  year.2 

The  suggested  price  of  the  price- fixing  committee  was  finally 
accepted  by  the  acid  industry,  and  $16  was  agreed  upon  as  the  price 
of  a  ton  of  60°  B.  sulphuric  acid  for  the  last  quarter  of  1918.3 

Nitric  acid  :  Shortly  after  the  determination  of  a  Government  price 
for  sulphuric  acid  in  the  latter  part  of  1917,  an  agreement  was  reached 
with  the  producers  of  nitric  acid,  whereby  they  obligated  themselves 
to  supply  the  military  and  naval  needs  for  42°  B.  nitric  acid  at  7^ 
cents  per  pound.  Toward  the  middle  of  1918,  however,  the  Ordnance 
Department  began  to  experience  difficulty  in  placing  new  orders  at 
the  agreed  price.  An  investigation  was  therefore  made  into  the  costs 
of  the  concerns  which  were  furnishing  nitric  acid  supplies,  and  it 
was  found  that  the  approximate  cost  of  manufacturing  a  pound  of 

1  The  increasing  costs  of  materials,  labor,  fuel,  and  transportation  increased  this  cost 
considerably  during  the  latter  half  of  1918.     The  prices  recommended  by  the  price-fixing 
committee,  however,  made  a  liberal  allowance  for  this  increase,  for  it  was  their  desire 
to  fix  a  price  which  would  permit  the  acid  manufacturers  to  use  domestic  pyrites,  which 
meant  a  higher  production  cost  than  would  have  been  the  case  had  brimstone  been  used. 
Both  raw  materials  were  selling  at  almost  equal  prices,  but  most  of  the  American  plants 
were  equipped  for  the  use  of  brimstone  rather  than  pyrites.     The  shipping  shortage  had 
virtually  cut  off  the  supply  of  Spanish  pyrites,  which  had  previously  been  the  common 
raw  material  used  in  producing  sulphuric  acid,  and  various  plants  turned  to  the  use  of 
domestic  brimstone.     This  led  to  a  sudden  growth  in  the  consumption  of  the  latter,  and 
soon  the  demand  threatened  to  exceed  the  possible  production.     Indeed,  the  reserve  stocks 
wore  drawn  upon  and  a   serious  depletion  was   threatened. 

2  Note  memorandum  from  Mr.  A.  K.   Brunker,  chief  of  the  acids  and  heavy  chemicals 
section    of   the   War   Industries   Board,   to  Mr.   L.    L.    Summers,    chief   of   the   chemicals 
division. 

8  A  price  of  $25  per  ton  was  fixed  for  66°  acid  and  $28  for  20  per  cent  oleum.  In 
this  connection  it  is  interesting  to  note  that  had  the  war  continued  a  vast  economy  in 
the  factory  cost  of  producing  acids  would  have  been  obtained  by  the  Government  through 
the  use  of  its  new  plants,  which  could  have  turned  out  100  per  cent  H2SO4  at  $15  per 
ton,  while  the  fixed  price  for  20  per  cent  oleum  (104|  per  cent  H2SO4)was  $28  f.  o.  b. 
makers'  works,  or  about  $30  per  ton  laid  down  at  consumers'  works.  The  saving,  there- 
fore, would  have  been  approximately  50  per  cent.  This  figure,  however,  does  not  take 
into  consideration  the  cost  of  the  Government  plant,  and  thereby  eliminates  a  large  over- 
head charge.  (Cf.  memorandum  by  Mr.  John  M.  Goetchius  in  the  files  of  the  War  In- 
dustries Board.) 


344  HISTORY   OF   PRICES   DURING   THE    WAR. 

nitric  acid  was  7.14  cents.1  This  meant,  then,  that  the  average  profit 
realized  on  the  agreed  Tj  cents  price  was  but  0.36  cent. 

It  was  immediately  apparent  that  the  price  of  nitric  acid  to  the 
Government  would  have  to  be  raised,  and  on  July  26  the  question 
was  brought  before  the  price  fixing  committee.  It  was  necessary 
first  to  fix  the  price  of  sulphuric  acid,  however,  since  the  price  of 
nitric  acid  is  in  large  part  dependent  upon- the  latter.  On  the  basis 
of  the  sulphuric  acid  price  of  $28  per  ton  2  for  66°  B.,  the  price  of 
42°  nitric  acid  was  fixed  at  8  cents  per  pound  for  all  consumers, 
civilian  and  Governmental,  effective  July  1,  1918,  for  the  third  quar- 
ter of  the  year.  This  price  was  continued  by  agreement  through  the 
last  quarter  of  1918,  and  expired  by  limitation  on  December  31. 

Conclusion. — With  the  cessation  of  hostilities  came  the  end  of  the 
Governmental  need  for  acids.  The  immediate  fear  of  the  trade  was 
the  potential  competition  of  the  newly  completed  Government  plants. 
Moreover,  there  was  the  danger  of  a  sudden  fall  in  acid  prices  in  con- 
sequence -of  the  cancellation  of  contracts  and  the  desire  to  get  rid  of 
surplus  stocks.  Accordingly,  the  War  Industries  Board  was  asked 
to  continue  its  supervision  of  the  acid  industry  and  to  relieve  the 
trade  of  "  a  share  of  its  burden  in  adjusting  inventories  and  heavy 
warring  stocks."  The  trade  also  asked  for  the  continuation  of  price 
fixing,  at  least  through  the  first  quarter  of  1919.  The  price-fixing 
committee  did  not  feel  that  conditions  warranted  any  such  action, 
and  on  December  3,  1918,  they  voted  to  discontinue  the  agreed  prices 
of  heavy  acids  after  December  30,  1918. 

Sulphur  and  pyrites. — Prior  to  1917  approximately  60  per  cent  of 
'the  sulphuric  acid  consumed  in  the  United  States  was  made  from 
Spanish  ores.  The  shipping  shortage  of  1918,  however,  made  neces- 
sary the  curtailment  of  our  pyrites  receipts,  and  in  March  the  War 
Trade  Board  issued  an  order  restricting  Spanish  pyrites  importa- 
tions to  125,000  tons  for  the  six  months  following  April  15.  This 
amount,  which  was  less  than  enough  to  fill  our  requirements,  was 
distributed  by  the  committee  on  foreign  pyrites  of  the  Chemical 
Alliance  (Inc.),  to  the  five  importers  who  formerly  controlled  the 

1  The  cost  of  producing  95  pounds  of  nitric  acid,  as  given  in  the  report  of  the  chemical 

section  of  the  War  Industries  Board,  was  as  follows  : 

Raw  materials  : 

Nitrate  of  soda $4.  25 

Sulphuric  acid 1.  35 


Total  cost  of  raw  materials 5.  60 

Fair  average  manufacturing  cost,  including  overhead 1.  18 


Total   cost   of   95    pounds 6.  78 

Cost  of  1  pound  of  nitric  acid .0714 

2  On  the  basis  of  100  pounds  of  H2SO4  being  required  to  produce  95  pounds  of  HNO3, 
it  appears  from  the  above  cost  figures  that  $27  rather  than  $28  (the  fixed  price  June 
26)  was  used  as  the  cost  of  a  ton  of  HoSO*. 


GOVERNMENT    CONTROL   OVER   PRICES.  345 

greater  part  of  our  foreign  receipts,  in  proportion  to  the  tonnage 
imported  by  each  in  1917. 

The  cutting  off  of  our  sulphur  supplies  had  a  considerable  effect 
upon  the  American  brimstone  industry,  and  the  demand  for  the 
domestic  product  grew  by  leaps  and  bounds.  The  large  demand 
for  sulphur  supplies  and  the  essential  part  which  sulphuric  acid 
played  in  the  war  program,  led  to  a  more  or  less  strict  control  over 
the  brimstone  industry  during  the  spring  and  early  summer  by  the 
War  Industries  Board. 

There  are  in  the  United  States  two  companies  which  produce  99 
per  cent  of  all  the  sulphur  entering  into  domestic  consumption,  and 
the  output  of  both  was  put  under  allocation  by  the  War  Industries 
Board.  It  appears,  however,  that  one  of  these  companies  did  not 
cooperate  as  actively  and  as  wholeheartedly  as  was  desired  by  the 
chemical  section  of  the  War  Industries  Board.  The  chemical  au- 
thorities in  Washington  offered  a  resolution,  therefore,  which  was 
passed  by  the  War  Industries  Board  and  approved  by  the  President 
on  July  2,  1918,  authorizing  the  virtual  commandeering  of  the  sul- 
phur-producing industry.  The  chief  of  the  sulphur  and  pyrites  sec- 
tion was  appointed  to  represent  the  War  Industries  Board  in  con- 
trolling the  production  and  distribution  of  sulphur  materials,  and 
he,  together  with  a  committee  of  the  Chemical  Alliance,  adminis- 
tered the  industry  during  the  remainder  of  the  war  period. 

In  the  fall  of  1917  the  fertilizer  committee  of  the  Chemical 
Alliance  had  arranged  for  a  price  of  $22  per  long  ton  f.  o.  b.  mines, 
for  governmental  purchases  of  sulphur,  and  this  policy  continued 
through  the  first  half  of  1918.  The  same  price  was  maintained  after 
the  War  Industries  Board  took  control  of  the  sulphur  industry  in 
July.  Although  there  was  at  no  time  adopted  any  complete  system 
of  sulphur  price  agreements  which  applied  to  all  purchasers,  the 
control  of  supplies  and  the  allocation  thereof  by  the  War  Industries 
Board  to  essential  consumers  only,  had  the  effect  of  a  fixed  price. 

Wood  chemicals. — It  can  hardly  be  said  that  wood  chemicals  were 
subject  to  price  fixing  in  the  accepted  sense  of  the  term,  for  the  price 
agreements  which  were  made  relative  to  the  products  of  wood  dis- 
tillation applied  in  most  instances  only  to  sales  to  the  United  States 
Government  and  to  the  Allies.  Yet  the  fact  that  prices  were  fixed 
to  the  military  consumers  had  an  important  effect  upon  market 
prices  in  general,  and  for  that  reason  the  situation  in  the  industry 
is  worthy  of  consideration. 

A  number  of  chemicals  which  are  both  the  direct  and  indirect  prod- 
ucts of  wood  distillation  were  vitally  connected  wjtb  our  military 


346  HISTORY   OF   PRICES   DURING   THE   WAR. 

program  of  1917-18,1  and  it  was  thought  necessary  from  the  very 
beginning  to  avoid  anj  possible  dissipation  of  the  stocks  in  the  hands 
of  distillers.  Wood  chemicals  were  therefore  placed  under  requisi- 
tion by  an  order  of  the  Secretary  of  War  on  December  24,  1917,  and 
from  that  date  until  December  14, 1918,  the  distribution  of  the  entire 
American  production  of  acetate  of  lime,  acetone,  ketone,  and  wood 
alcohol — the  output  of  some  100  concerns — was  administered  by  the 
wood  chemical  section  of  the  War  Industries  Board.2 

It  was  necessary,  however,  to  make  some  agreement  upon  prices  to 
be  paid  these  distillers,  and  before  the  year  1917  came  to-  a  close  the 
prices  of  all  the  important  direct  products  of  wood  distillation  to 
the  United  States  Government  and  to  the  Allies  were  fixed.3  The 
prices  thus  fixed  were  in  most  instances  lower  than  the  current 
market  quotations,  and  since  the  supplies  taken  under  control  were 
allocated  mainly  to  producers  of  more  highly  fabricated  chemicals, 
the  authorities  in  charge  saw  to  it  that  the  benefits  secured  from  this 
lower  price  were  likewise  figured  for  the  finished  products,  which, 
after  all,  were  the  most  needed  for  the  military  program. 

Acetic  acid:  Large  quantities  of  acetic  acid  were  required  by  the 
Army  authorities.  The  price  of  acetic  acid  current  in  early  1918 
was  based  on  a  6-cent  cost  for  acetate  of  lime,  which  in  December. 
1917,  had  been  lowered  by  the  Government  authorities  to  4  cents  per 

1  This   was   especially   true  of   certain  of  the  wood  distillates   upon   which   the   Signal 
Corps  was  dependent  for  the  manufacture  of  cellulose,  acetate,  etc. 

2  The  original  commandeering  order  extended  only  to  July  1,   1918.     It  was  later  ex- 
tended for  six  months  following  July,  the  National  Wood  Chemical  Association  having 
agreed  that  the  terms  and  conditions  covering  the  original  commandeering  order  would 
be  a  satisfactory  basis  for  the  second  half  of  the  year. 

3  The  prices  for  the  various  products  were  fixed  f.  o.  b.  shipping  point  as  follows : 

Acetate  of  lime  (cents  per  pound) 4 

Crude  wood  alcohol   (cents  per  gallon) 50 

95  per  cent  wood  alcohol    (cents  per  gallon) 79 

97  per  cent   wood  alcohol    (cents   per   gallon) 82 

Pure  methyl  alcohol   (cents  per  gallon) 86 

Methyl    acetone    (cents    per    gallon) 86 

Denaturing    grade    alcohol    (cents    per   gallon) 79 

Ethyl  methyl  ketone    (cents  per  pound) 25J 

These  prices  continued  in  effect  as  long  as  the  industry  was  under  the  control  of  the 
Government  authorities.  Due  to  demands  for  higher  wages  and  due  to  the  increases  in 
freight  rates,  in  the  summer  of  1918,  the  National  Wood  Chemical  Association  asked  for 
a  higher  price  for  acetate  of  lime  and  crude  alcohol.  This  request  was  presented  to  the 
price-fixing  committee  to  be  acted  upon,  but  that  body  in  turn  passed  it  on  to  the  Federal 
Trade  Commission  so  that  an  investigation  of  costs  might  be  made.  No  report  on  the 
situation  had  been  received  tip  to  the  time  of  removing  of  control  in  December,  and 
houce  no  action  was  ever  taken  by  the  price-fixing  committee  relative  to  increasing  the 
price. 

The  price  fixed  for  refined  wood  alcohol  did  not,  as  was  the  case  with  the  other  wood 
chemicals  taken  over,  go  into  effect  immediately  after  requisitioning  the  industry;  for 
there  were  on  band  Dec,  31,  1917,  large  stocks  of  alcohol  which  had  been  refined  from 
crude  bought  at  the  November  and  December  market  price  of  90  cents  per  gallon.  It  was 
doomed  advisable  out  of  justice  to  the  trade,  that  such  supplies  be  disposed  of  on  the 
basis  of  90  cent  crude  alcohol,  and  that  the  new  priceMnentioned  above  go  into  pffect  when 
the  old  stocks  had  been  absorbed. 


GOVERNMENT    CONTROL    OVER   PRICES.  347 

pound.  Accordingly,  on  February  13,  1018,  the  chemical  section  of 
the  War  Industries  Board  arranged  to  have  %the  price  of  acetic  acid 
lowered  so  as  to  be  equitable  with  the  4-cent  basis  for  acetate  of  lime ; 
and  after  investigating  the  costs  of  producing  acid,  fixed  the  price  of 
100  per  cent  commercial  acetic  acid  at  15|  cents  per  pound.  Al- 
though this  price  was  almost  10  cents  lower  than  the  current  quota- 
tions, it  allowed  for  a  fair  margin  of  profit  since  it  had  been  found 
that  the  average  cost  of  production  varied  from  11.44  cents  to  14.50 
cents.  There  were  on  hand  on  February  1,  however,  large  stocks  of 
acetic  acid  produced  from  acetate  of  lime  which  had  been  purchased 
on  the  old  price  basis,  and  justice  to  the  producers  demanded  that 
some  provision  be  made  for  their  disposal.  An  exception  was  there- 
fore made  in  the  case  of  these  supplies,  and  producers  were  allowed 
to  dispose  of  them  on  a  basis  of  6-cent  acetate  of  lime. 

Likewise,  provision  was  made  for  the  price  of  glacial  acetic  acid 
on  the  basis  of  the  new  price  of  acetate  of  lime  and  19  cents  was 
fixed  as  the  figure  at  which  this  commodity  was  to  be  delivered, 
naked  at  plant,  on  Government  purchases.  Here,  also,  the  fixed 
price  was  considerably  lower  than  the  current  market  price  of  from 
31  to  40  cents.  Indeed,  glacial  acid  had  always  held  a  fictitious 
price  in  the  trade,  since  the  entire  production  was  virtually  under 
the  control  of  three  manufacturers.  The  19  cent  price  represented 
a  profit  of  15  per  cent  under  an  economical  process  of  manufacture,1 
and  yet  it  appears  that  the  manufacturers  were  dissatisfied  with  it. 
They  felt  that  they  were  entitled  to  25  cents  a  pound  for  their 
product.  The  chemical  section  of  the  War  Industries  Board  refused 
this  request  and  the  producers  were  asked  to  accept  the  19  cent  price 
or  submit  detailed  cost  of  production  figures  to  substantiate  the 
validity  of  their  claim.  The  glacial  acetic  acid  producers  then  ac- 
cepted 19  cents  for  their  product  as  manufactured  from  materials 
on  which  the  Government  price  had  been  fixed. 

Methyl  acetate :  The  early  part  of  1918  witnessed  a  shortage  of 
this  chemical  and  it  appeared  that  there  would  be  difficulty  in  se- 
curing Army  requirements.  Moreover,  there  was  at  first  little  hope 
of  increasing  the  supply,  since  the  entire  production  was  in  the  hands 
of  a  single  concern.  Finally,  however,  other  firms  were  interested  in 
the  situation  and  agreed  to  undertake  production  at  21  cents  per 
pound.  This  figure  was  based  on  the  fixed  price  of  methyl  alcohol 
and  acetate  of  lime  and  was  adopted  as  the  price  for  all  Government 
orders. 

Formaldehyde:  The  production  of  formaldehyde  in  early  1918 
was  in  the  control  of  five  concerns.  A  detailed  investigation  of  their 
costs  of  production  showed  Chat  they  were  manufacturing  formalde- 


1  Compare  memorandum  from  L.  L.  Summers  to  the  War  Industries  Board.  F«>1>.  If 5,  1918. 


348  HISTORY    OF    PRICES    DURING   THE    WAR. 

hyde  at  a  cost  of  12^  to  134  cents.1  The  market  price  at  times  was 
around  22  cents  per  pound,  while  prices  as  high  as  30  and  35  cents 
had  been  quoted.  It  was  apparent  that  the  situation  warranted  a 
revision  of  prices,  and  on  February  12,  at  a  meeting  with  the  for- 
maldehyde manufacturers,  a  price  of  15  \  cents  per  pound  was  fixed 
for  formaldehyde  f.  o.  b.  shipping  point,  naked.  This  price,  how- 
ever, was  based  on  86  cents  pure  methyl  alcohol,  which  was  the 
figure  fixed  for  Government-controlled  supplies.  There  were  in  the 
hands  of  the  manufacturers  large  stocks  which  had  been  produced 
from  alcohol  that  had  cost  $1.25,  the  old  market  price.  An  oppor- 
tunity to  dispose  of  these  stocks  at  the  old  prices  was  therefore  given 
to  the  producers  of  formaldehyde,  and  not  until  June  12,  1917,  did 
the  agreed  price  of  15-|  cents  really  become  effective.2 

Toluol. — In  prewar  times  toluol  played  relatively  a  small  part  in 
the  chemical  consumption  of  the  United  States.  Indeed,  it  was 
merely  a  by-product  of  coal-tar  distillation,  the  production  of  which 
was  little  developed.  The  American  consumption  prior  to  1914 
was  approximately  500,000  gallons  annually.  Toluol  prices  varied 
from  19  to  30  cents.  The  outbreak  of  the  European  war,  however, 
with  the  consequent  demand  for  explosives  revolutionized  the  pro- 
duction of  toluol,  and  overnight,  as  it  were,  this  chemical  assumed  a 
position  of  utmost  importance.  The  war  had  not  yet  entered  its 
tenth  month  when  the  price  of  toluol  jumped  from  25  cents  to  $2.50 
per  gallon,  and  on  the  first  anniversary  of  the  declaration  of  hostili- 
ties, market  quotations  were  in  the  vicinity  of  $3.50.  At  the  end  of 
1915  the  peak  of  this  runaway  market  was  reached  when  toluol  was 
quoted  at  $4.50  This  price  continued  through  May,  1916.  It  was 
inevitable  that  such  prices  should  lead  to  the  development  of  facilities 
for  the  greater  production  of  toluol,  and  by  the  middle  of  1916  many 
new  plants  were  reaching  completion.  The  new  potential  supply 
led  to  a  "  softening "  of  the  market  and  June  witnessed  a  fall  in 
prices,  while  the  addition  of  still  further  productive  facilities  finally 
brought  toluol  prices  down  to  $1.50  per  gallon  in  November. 

It  was  at  this  point  that  the  United  States  Ordnance  Department 
entered  the  market  after  our  declaration  of  war  in  1917,  and  the  price 
of  $1.50  was  agreed  upon  with  the  producers  for  our  military  sup- 
plies. However,  it  became  evident  that  this  price  would  not  itself 
lead  to  the  acquiring  of  a  supply  sufficiently  large  to  meet  all  the 
necessary  demands.  Accordingly,  the  Ordnance  Department  set  out 
to  stimulate  production,  and,  by  placing  large  contracts,  advancing 

1  These  costs  were  based  on  the  Government  fixed  price  of  raw  materials. 

2  This  15^-cent  price  for  formaldehyde  was  one  of  the  few  instances  where  the  price 
of  a  requisitioned  commodity  was  distinctly  fixed  for  the  United  States  Government,  the 
Allies  and  the  consuming  public  alike.     Usually  such  fixed  prices  were  made  applicable  to 
the  United  States  Government  and  the  Allies  only. 


GOVERNMENT    CONTROL   OVER   PRICES.  349 

funds  for  the  construction  of  private  and  Government  plants,  it 
increased  our  productive  facilities  so  that  our  output  for  1918  reached 
13,553,860  gallons.  This  amount  represented  an  increase  of  almost 
3,000  per  cent  over  the  prewar  average. 

A  large  part  of  this  growth  in  production  was  achieved,  however, 
only  after  the  toluol  industry  had  been  commandeered  in  February, 
1918,  when  there  began  a  distribution  of  all  toluol  produced  in  the 
United  States  by  a  committee  of  representatives  of  the  Army,  Navy, 
and  War  Industries  Board.  The  price  paid  for  the  toluol  so  com- 
mandeered was  the  agreed  figure  of  $1.50  per  gallon.  On  July  18, 
1918,  the  price-fixing  committee  approved  this  price  as  applicable  to 
all  sales  of  toluol,  civilian  as  well  as  military,  and  no  shipments  were 
allowed  from  any  plant  at  a  pi-ice  in  excess  of  $1.50  per  gallon  in 
tank  cars  and  $1.55  per  gallon  in  drums.  • 

In  November,  1918,  the  control  over  the  toluol  industry  was  re- 
linquished. Immediately  the  market  crashed,  and  December,  1918, 
witnessed  sales  of  toluol  at  25  cents  a  gallon,  a  price  83J-  per  cent 
lower  than  the  quotations  for  the  preceding  month. 

Alkalies. — The  prices  of  alkalies  were  in -all  cases  fixed  for  Govern- 
ment purchases  only  and,  with  the  possible  exception  of  liquid 
chlorine,  the  nonmilitary  use  of  which  was  virtually  eliminated  from 
June  to  November,  1918,1  the  prices  so  fixed  were  considerably  lower 
than  those  on  the  open  market.  Virtually  all  agreements  as  to  the 
price  of  the  alkalies  were  made  in  early  1918  and  continued  through 
the  year  until  November  25.  Several  agreed  prices,  however,  such  as 
those  of  carbon  tetrachloride  and  caustic  soda,  remained  effective 
until  the  end  of  the  year. 

1  A  brief  summary  of  the  prices  fixed  on  the  various  alkalies,  such  as  bleaching  powder, 
carbon  tetrachloride,  caustic  soda,  liquid  chlorine,  and  soda  ash  will  be  found  on  p.  805. 


6.  THE  WAR  TRADE  BOARD. 

The  War  Trade  Board,  charged  with  the  responsibility  for  de- 
termining what  commodities  should  be  exported  or  imported,  exer- 
cised less  direct  price  control  than  any  other  war  board.1  It 
obviously  had  no  concern  with  the  great  bulk  of  staples  that  were 
bought  and  sold  for  war  uses  within  the  country.  The  board,  to  be 
sure,  had  practically  absolute  power  to  permit  or  refuse  licenses  to 
export  goods  or  import  them,  and  sometimes  used  that  weapon  when 
requested  to  enforce  price  regulations  upon  exporters  and  importers. 
But  the  business  of  controlling  the  amounts  of  exports  and  imports 
wras  in  itself  a  big  one,  and  the  War  Trade  Board  usually  left  to 
other  boards  the  setting  of  prices.  That  procedure  seemed  to  it 
wise,  in  part  because  the  War  Industries  Board,  the  Food  Admin- 
istration, and  the  Fuel  Administration  were  all  regulating  prices, 
but  more  especially  because  the  tonnage  and  the  enemy-trade  prob- 
lem, rather  than  price  factors,  were  the  primary  basis  for  determin- 
ing what  goods  to  export  or  import. 

(i)  THE  CREATION  OF  THE  WAR  TRADE  BOARD. 

The  passing  in  turn  of  the  espionage  act  and  the  tiading-with- 
the-enemy  act  gave  the  President  wide  powers  over  exports,  imports, 
and  enemy  trade.  The  President,  in  full  appreciation  of  the  serious 
need  for  a  control  over  all  foreign  trade,  created  the  War  Trade 
Board  through  an  Executive  order  of  October  12,  1917,  and  charged 
it  with  a  responsibility  for  administering  the  controls  authorized 
by  these  two  laws.  The  new  War  Trade  Board,  by  that  order,  super- 
seded the  earlier  Exports  Administrative  Board  and  the  former 
Exports  Council  became  the  War  Trade  Council.2  There  was  thus 
set  up  the  final  machinery  for  a  control  over  all  war  trade.  It  is 
worthy  of  note  at  this  point  that  the  presidential  proclamation  of 

1 A  fuller  account  of  the  activities  of  the  War  Trade  Board  should  be  had  from  its 
own  forthcoming  official  history. 

2  The  War  Trade  Board,  made  up  of  representatives  from  various  important  Government 
bureaus,  had  the  following  membership  at  the  signing  of  the  armistice  :  Vance  McCor- 
mick,  chairman,  and  representative  of  the  Secretary  of  State ;  Thomas  L.  Chadbourne. 
jr.,  counselor,  and  representative  of  the  Secretary  of  State ;  Albert  Strauss,  representa- 
tive of  the  Secretary  of  the  Treasury  ;  Alonzo  E.  Taylor,  representative  of  the  Secretary 
of  Agriculture ;  Clarence  M.  Woolley,  representative  of  the  Secretary  of  Commerce ; 
Beaver  White,  representative  of  the  Food  Administration  ;  and  Edwin  F.  Gay,  representa- 
tive of  the  United  States  Shipping  Board. 

350 


GOVERNMENT   CONTROL   OVER   PRICES.  351 

November  28,  1917,  vitally  enlarged  the  scope  of  War  Trade  Board 
duties  by  increasing  the  list  of  commodities  requiring  license  for 
export,  and  by  the  initial  making  of  a  similar  list  for  imports. 

The  turning  of  this  country  from  a  neutral  into  an  ally  involved 
the  laying  down  of  very  definite  policies  with  respect  to  our  foreign 
trade.  It  meant  especially  the  conserving  of  our  own  supplies  for 
our  war  machinery  and  that  of  our  Allies,  the  cutting  off  of  all 
direct  or  indirect  trade  with  the  enemy,  and  the  conservation  of 
tonnage  for  war-making  uses.  The  working  out  of  these  general 
policies  by  the  War  Trade  Board  gave  rise  to  four  primary  functions, 
around  which  virtually  the  whole  work  of  the  board  turned:  The 
commercial  isolation  of  the  enemy,  the  financial  isolation  of  the 
enemy,  the  obtaining  of  essential  supplies  and  controlling  prices, 
and  the  conservation  of  ocean  tonnage.1 

(2)  ALL  EXPORTS  AND   IMPORTS   BROUGHT   UNDER  LICENSE 

CONTROL. 

The  actions  of  the  War  Trade  Board  concern  price  control  only 
so  far  as  they  pertain  to  the  exercise  of  regulation  over  prices,  direct 
enough  to  lay  hands  upon.  The  extension  of  control  over  exports 
and  imports  ushered  in  important  influences  upon  prices.  The 
control  of  exports,  begun  relatively  early,  and  later  that  of  imports 
were  extended  item  by  item  until  the  two  famous  proclamations  of 
February  14,  1918,  brought  under  license  control  all  exports  and 
imports.2 

THE  CONTROL  OVER  EXPORTS. 

It  is  conceivable  that  the  restraint  upon  the  exportation  of  certain 
commodities  that  was  imposed  by  the  requirement  of  licenses  for 
exports  sometimes  had  a  more  vital  indirect  effect  upon  the  price 
level  than  the  corresponding  restraint  of  imports.  The  effect  pre- 
sumably would  be  most  felt  in  the  prices  of  those  goods  which  were 
not  only  brought  under  license  control,  but  were  actually  denied 
exportation  and  thrown  as  a  consequence  into  the  home  market.  In 
a  general  way  the  actual  holding  of  commodities  from  foreign  sale, 
in  so  far  as  it  increases  the  supply  at  home,  would  tend  to  lower  or 

1  This  division  of  functions  was  selected  by  Henry  F.  Walradt  and  B.  D.  Mudgett  as 
the  basis  for  their  history  of  the  War  Trade  Board. 

2  The  War  Trade  Board  issued  at  the  same  time  a  statement  in  which  it  said  in  part : 
"  The  promulgation  of  these  two  proclamations  did  not  mean  an  embargo  on  exports  or 

a  prohibition  of  imports,  but  placed  in  the  hands  of  the  President  the  power  to  regulate, 
which  be  will  exercise  through  the  War  Trade  Board  and  the  Treasury  Department. 
This  power  will  be  exercised  with  the  single  purpose  of  winning  the  war,  and  every  effort 
will  be  made  to  avoid  unnecessary  interference  with  our  foreign  trade  and  to  impose  upon 
our  exporters  and  importers  no  restrictions  except  those  involved  in  the  accomplish- 
ment of  definite  and  necessary  objects." 


352  HISTORY   OF   PRICES   DURING   THE   WAR. 

stabilize  market  prices.     But  there  is  no  measure  of  the  effect  of 
these  export  rulings  that  is  accurate  or  even  approximate.1 

THE  CONSERVATION  LIST. 

The  commodities  for  which  the  War  Trade  Board  required  licenses 
prior  to  their  exportation  were  said  to  have  been  put  upon  the  con- 
servation list.  This  conservation  list,  which  began  with  a  very  few 
important  raw  materials  on  July  9,  1917,  was  extended  from  time 
to  time  until  the  whole  lot  of  exports  were  entered  upon  it  by  Febru- 
ary 14,  1918,2  and  by  the  signing  of  the  armistice  it  contained  nine 
hundred  odd  commodities.3  These  commodities,  which  contained 
representatives  virtually  from  our  whole  range  of  production,  were 
all  actually  restricted  from  export  trade  under  license  control. 

THE  CONTROL  OVER  IMPORTS. 

The  control  over  imports,  whether  of  more  or  less  influence  upon 
the  price  level,  afforded  more  opportunity  for  price  regulation.  The 
War  Trade  Board,  which  was  not  a  price-regulating  body  and  which 
interfered  with  prices  only  when  pressed  to  it  by  other  bodies,  was 
seldom  under  necessity  for  stipulating  prices  for  exports,  since  the 
regulation  of  domestic  commodities  was  exercised  by  the  War  In- 
dustries Board,  the  Food  Administration,  and  the  Fuel  Administra- 
tion. But  frequently  these  very  bodies  found  themselves  under  pe- 
culiar administrative  difficulties  in  the  price  control  of  foreign  goods 
imported  into  the  country,  and  appealed  to  the  War  Trade  Board 
to  stipulate  stabilization  as  a  condition  of  their  entrance  into  Ameri- 
can markets. 

THE  RESTRICTED  LIST. 

This  inquiry  does  not  go  into  the  ramifications  of  import  control, 
except  as  prompted  by  odd  instances  where  the  War  Trade  Board 
stipulated  price  regulation  as  a  condition  for  the  granting  of  an 
import  license.  The  board,  in  order  to  interfere  as  little  as  possible 
with  business  as  constituted,  administered  these  import  controls 
largely  through  trade  organizations.  The  latter,  in  cooperation  with 
the  War.  Trade  Board,  acted  as  consignees  of  various  import  com- 
modities to  keep  themselves  informed  for  the  benefit  of  the  board 

1  The  following  instance  of  an  exercise  of  price  control,  in  connection  with,  the  export 
license  power,  is  perhaps  more  interesting  than  widely  significant. 

On  and  after  July  20,  1918,  no  license  will  be  issued  authorizing  the  exportation  of 
gold  jewelry,  gold  watches,  gold  plate,  or  other  manufactures  of  gold  unless  evidence 
satisfactory  to  the  War  Trade  Board  is  submitted  showing  that  the  f.  o.  b.  selling  price 
of  the  articles  to  be  exported  is  not  less  than  three  times  the  value  of  the  fine  gold 
contained  in  such  articles. 

2  The  proclamation  of  Feb.  14,  1918,  became  effective  Feb.  16. 

8  Consult  the  Export  Conservation  List  issued  by  the  War  Trade  Board,  effective  Oct. 
15,  1918,  and  that  effective  Dec.  6,  1918. 


GOVERNMENT  CONTROL  OVER  PRICES.  353 

as  to  the  use  and  disposition  of  the  import  commodities,  and  the 
observance  by  the  importers  of  any  guaranty  or  agreement  given 
in  connection  therewith;  to  prevent  hoarding  and  speculation,  and 
to  keep  full  and  complete  records  of  the  commodities  and  their  dis- 
tribution1. The  extension  of  import  control  was  made  by  the  plac- 
ing gradually  of  certain  commodities  upon  the  so-called  restricted 
list.  That  list,  the  initial  issue  of  which  appeared  November  28, 
1917,  was  made  to  include  all  imports  by  February  14,  1918,  and 
thus  contained  more  than  140  classes  of  commodities  by  the  signing 
of  the  armistice. 

(3)   THE  EXERCISE  OF  PRICE  CONTROL  BY  USES  OF  THE  LICENSING 

POWER. 

There  lay  in  the  very  restriction  of  exports  and  imports,  even 
where  a  direct  price  control  was  not  exercised  specifically,  a  potent 
though  not  measurable  influence  upon  prices.  The  War  Trade  Board 
exercised  infinitely  more  export  and  import  restrictions  than  the 
few  in  which  it  avowed  a  direct  interest  in  the  price  factor.  But 
in  the  main  an  enormous  restriction  upon  export  trade  in  particular 
goods  for  any  reason  would  tend  to  stabilize  domestic  prices,  and  a 
corresponding  restriction  upon  imports  would  tend  to  disturb  the 
prices  of  available  stocks.  The  great  body  of  export-conservation 
rulings,  it  would  be  supposed,  worked  for  lower,  and  that  of  import- 
restriction  rulings  for  higher  prices.  But  this  very  considerable  in- 
direct influence  which  the  War  Trade  Board  rulings  must  have  had 
upon  prices,  important  though  it  be,  leads  too  far  into  speculation 
for  its  adequate  analysis  in  a  record  of  fact. 

Quite  apart  from  any  indirect  effects  upon  prices  which  may  have 
resulted  from  export  or  import  restrictions  as  such,  there  were  sev- 
eral steps  taken  by  the  War  Trade  Board  to  control  prices.  Those 
instances  came  in  the  form  of  conditions  which  the  board  set  up  as 
prerequisite  to  the  issuing  of  licenses  for  the  importation  of  a  few 
of  the  commodities  appearing  on  the  restricted  list.  Even  those 
exceptional  cases,  however,  were  seldom  highly  developed  controls 
such  as  were  issued  and  administered  by  the  price-fixing  boards. 
They  were,  for  the  most  part,  blanket  provisions  simply  looking  to 
the  stabilization  of  the  prices  for  imported  goods  in  the  domestic 
markets.  The  War  Trade  Board,  at  requests  from  other  war  boards, 
undertook  to  provide  in  part  for  the  stabilization  of  certain  prices 
(asbestos,  pig  tin,  chloride  of  tin,  tin  ore,  wool,  pickled  skins,  varnish 
gums,  sugar,  castor  oil,  castor  beans,  hides  and  skins,  leather,  tanned 
skins,  silk  noils,  silk-noil  yarns,  garnetted  stock  and  silk  waste, 

1  Rules  and  regulations,  War  Trade  Board,  No.  2,  May,  1918,  p.  G4. 
125547°— 20 23 


354  HISTOBY   OF   PRICES   DURING   THE   WAR. 

manila  fiber,  crude  rubber,  coffee,  Xew  Zealand  fiber,  copra,  tin, 
burlap,  burlap  bags,  and  jute),  either  by  requiring  the  importer  to 
give  a  guaranty,  an  option,  both  a  guaranty  and  tin  option,  per- 
mitting importation,  of  substitutes,  restriction  of  certain  imports 
that  would  compete  with  domestic  stocks,  or  by  imposing  an  em- 
bargo.1 

One  method  by  which  the  War  Trade  Board  took  precaution  that 
goods  coming  in  under  authority  of  its  licenses  should  not  be  hoarded 
for  speculation,  was  to  require  a  guaranty  from  the  importer  that  he 
sell  his  goods  not  above  the  maximum  set  by  any  war  board.  Appli- 
cants for  sugar  or  wheat-flour  licenses  were  required  to  guarantee 
not  to  sell  their  sugar  or  flour  to  any  party  at  any  price  without  first 
securing  the  approval  of  the  Food  Administration.  The  board,  by  a 
resolution  of  August  22,  1918,  declared  that  no  licenses  to  import 
pickled  skins  would  be  issued  unless  the  applicant  agreed  not  to  sell 
the  skins  at  a  price  in  excess  of  the  prices  established  by  the  price- 
fixing  committee.  Importers  of  asbestos,  pig  tin,  chloride  of  tin, 
and  tin  ore  were  required  to  guarantee  that  they  would  use  these 
imports  "  for  our  own  manufacturing  use  and  not  for  hoarding  or 
speculative  purposes."  A  ruling  passed  late  in  September,  1918, 
limiting  the  amount  of  varnish  gum  to  be  imported,  stipulated  that 
the  amounts  allowed  to  enter  should  be  allocated  and  the  price  con- 
trolled by  the  War  Industries  Board.  Still  another  and  earlier 
ruling,  May  27,  restricted  the  amount  of  asphalt  allowed  to  enter  and 
required  the  importers  to  guarantee  to  sell  at  a  price  to  be  deter- 
mined by  the  War  Industries  Board. 

The  most  common  requirement  which  the  War  Trade  Board  im- 
posed as  a  condition  for  the  granting  of  an  import  license,  designed 
purely  to  regulate  prices,  was  the  agreement  of  the  importer  to  give 
the  Government  an  option  upon  the  imported  goods.  The  sugar 
guaranty,  indeed,  early  in  December,  1917.  had  contained  an  option 
clause  by  which  the  importer  promised  to  sell  his  sugar,  if  so  re- 
quested, to  the  international  sugar  committee  at  such  price  as  it 
might  prescribe.  The  well-known  early  wool  option  was  made  on 
December  15,  1917,  and  required  all  importers  of  foreign  wool  to 
give  the  Government,  as  a  condition  of  their  license,  an  option  to 
purchase  all  or  any  of  the  wool  covered  by  his  import  license,  at  a 
price  equivalent  to  5  per  cent  less  than  the  market  price  prevailing 
July  30,  1917.2  This  option  was  to  hold  10  days  after  the  entry  of 
the  wool  at  the  customhouse,  but  the  Government  was  given  the  right 
to  purchase  at  that  price  so  long  as  any  part  of  the  shipment  remained 

1  Mr.  Henry  F.  Walradt,  after  studying  carefully  the  minutes  and  other  records  of  the 
War   Trade  Board,   worked   out    the  above   classification    of   controls   over   prices. 

2  A   full   statement   of   the   regulations   governing   this  important   wool   option    may   be 
found  in  the  War  Trade  Board  Journal  of  Jan.  8,  1918,  p.  6. 


GOVERNMENT    CONTROL   OVER   PRICES.  355 

unsold.  It  became  soon  necessary,  in  order  to  expedite  the  adminis- 
tration of  the  wool  option,  to  enforce  it  through  the  medium  of  the 
Textile  Alliance.  The  importer  then  was  required  to  indorse  his  bill 
of  lading  to  this  private  organization,  as  a  condition  of  the  license.1 

Similar  options,  granting  the  Government  the  right  to  purchase 
the  goods  at  a  given  price,  were  required  as  a  condition  of  the  licenses 
allowing  the  importation  of  castor  oil,  castor  beans,  hides  and  skins, 
leather,  tanned  skins,  leather  manufactures,  platinum,  indium,  pal- 
ladium, quebracho  extract,  silk  noils,  garnetted  stock,  and  silk  waste. 

The  price  control  that  was  exercised  over  crude  rubber  combined 
the  guaranty  and  option  feature  in  a  unique  way.  The  Rubber  Asso- 
ciation of  America,  to  whom  the  War  Trade  Board  officially  asked  all 
importers  to  indorse  their  bills  of  lading,  was  required  not  to  release 
any  shipment  of  rubber  until  each  applicant  had  signed  an  option 
allowing  the  Government  to  purchase  the  stock  imported  at  a  certain 
price,  and  also  a  guaranty  that,  should  the  Government  not  take 
advantage  of  the  option,  the  importer  would  not  sell  the  imported 
rubber  at  a  price  higher  than  that  provided  by  the  option.2 

The  diverse  ways  by  which  the  War  Trade  Board  exercised  its 
licensing  power  to  control  prices  was  strikingly  illustrated  by  its 
resolution  of  May  23,  1918,  that  no  licenses  should  be  granted  for  the 
importation  of  coffee  which  was  carried  at  a  freight  rate  greater 
than  that  established  by  the  United  States  Shipping  Board.3 

There  is  on  record  one  case  where  the  War  Trade  Board  assisted 
a  Government  board  to  hold  down  the  prices  of  domestic  goods  by 

1  Mr.  Ilenry  F.  Walradt,  in  summary  of  the  results  of  this  wool  option  for  the  official 
history  record  of  the  War  Trade  Board  says  : 

'•  This  policy  of  obtaining  options  on  wool  imports  saved  the  United  States  over 
$33,000,000.  The  fact  that  the  wool  importers  were  required  to  give  this  option  made 
it  unprofitable  for  them  to  buy  foreign  wool  at  the  prices  which  were  prevailing  at  the 
close  of  the  year  1917 ;  consequently  the  foreign  growers  were  forced  to  lower  their 
prices.  From  Dec.  15,  1917,  when  the  option  agreement  was  put  into  force,  until 
Mar.  1,  1918,  the  average  price  of  imported  wool  of  the  grades  the  United  States 
Government  was  buying,  fell  from  about  GG  cents  to  somewhat  less  than  58  cents  a 
pound,  a  drop  of  about  81  cents  per  pound.  Purchases  made  after  Dec.  ID.  1917,  did 
not  begin  to  arrive  in  this  country  in  quantity  until  February,  191S.  From  Feb.  1, 
1918,  until  Dec.  31,  1918,  there  were  405,624,700  pounds  of  wool  imported  into  the 
United  States.  If  it  is  assumed  that  SJ  cents  was  saved  on  each  pound,  the  total  amount 
saved  by  this  policy  was  $33,464,038." 

2  One  of  the  most  interesting  instances  of  price  control   throughout  the  war   is   that 
set  forth  by  the  War  Trade  Board  pertaining  to  crude  rubber,  in  a   letter  to  the  Rub- 
ber  Association    of   America   on    Apr.    30,    1918.      That   letter    was   published    in   full    in 
the  War  Trade  Board  Journal  for  June,  1918,  p.  17. 

8  The  purpose  of  this  ruling  was  to  aid  in  enforcement  of  the  rates  which  had 
been  established  on  Nov.  21,  1917,  by  the  chartering  committee  of  the  Shipping  Board. 
It  appeared  that  these  rates  were  being  disregarded.  In  fact  at  the  time  this  ruling 
was  passed  the  coffee  en  route  to  the  United  States  was  being  transported  at  rateg 
which  caused  the  total  freight  charges  to  be  hundreds  of  thousands  of  dollars  in. 
excess  of  the  lawful  amount.  The  profiteering  in  freight  rates  on  coffee  had  caused 
an  unstable  condition  in  the  coffee  market,  and  a  wide  variation  in  the  cost  of  coffee 
to  different  buyers.  Accordingly,  all  licenses  for  the  importation  of  coffee  were  held 
up  until  the  importers  presented  a  sworn  statement  that  the  rate  of  freight  paid  for 
the  transportation  of  the  coffee  was  not  in  excess  of  the  rate  established  by  the  Ship- 
ping Board,  (Report  of  the  War  Trade  Board.) 


356  HISTORY   OF   PRICES   DURING  THE   WAR. 

allowing  the  unrestricted  entrance  of  a  substitute.  The  Food  Admin- 
istration attempted  during  the  war  to  prevent  rises  in  the  price  of  cot- 
tonseed oil  on  domestic  markets.  Copra,  which  is  used  to  manufac- 
ture coconut  oil,  has  a  vital  relation  to  the  prices  of  cottonseed  oil. 
The  War  Trade  Board,  in  order  to  assist  in  the  stabilization  of  cotton-^ 
seed  oil  prices,  lifted  its  restrictions  upon  the  importation  of  copra 
on  July  12,  1918. 

There  has  been,  since  the  signing  of  the  armistice  and  contrary  to 
the  prevailing  policies  previous,  occasion  to  sustain  the  prices  of  cer- 
tain materials  which  were  stimulated  in  production  during  the  war. 
The  War  Trade  Board,  in  one  conspicuous  instance,  attempted  to 
sustain  a  domestic  price  by  restricting  the  importation  of  competing 
goods.  A  considerable  importation  of  pig  tin  took  place  during  the 
war  at  high  prices  for  the  meeting  of  Government  orders.  That 
source  of  demand  was  cut  suddenly  short  by  the  cessation  of  hostili- 
ties, and  pig  tin  prices  began  to  break.  The  War  Trade  Board,  in 
order  to  protect  from  loss  buyers  who  in  good  faith  had  bought 
large  stocks  for  the  Government,  left  standing  its  restriction  upon 
the  importation  of  pig  tin.1 

One  of  the  more  serious  of  the  problems  confronting  the  Food 
Administration  and  the  War  Industries  Board  during  the  fall  of 
1918  was  the  rise  in  burlap  and  burlap  bags.  The  Government  had 
important  uses  for  these  materials  as  trench  bags  and  packing  cases. 
The  high  prices  for  bags  frequently  made  necessary  the  shipment  of 
potatoes  and  wheat  in  bulk  and  cargo  for  overseas  in  wooden  cases. 
The  British  Government  controlled  its  own  purchase  prices  for  bur- 

1  Mr.  Walradt  makes  the  following  summary  of  the  action  of  the  War  Trade  Board 
with  respect  to  pig  tin  after  the  signing  of  the  armistice  : 

"  In  order  to  protect  the  buyers  who  had  bought  at  high  prices  from  the  impending 
loss,  the  War  Trade  Board  maintained  the  restriction  upon  the  importation  of  pig 
tin  which  it  had  placed  by  a  resolution  passed  on  Oct.  4,  1918.  This  resolution  re- 
voked all  outstanding  licenses  for  the  importation  of  pig  tin,  tin  ore,  and  tin,  concen- 
trates, and  any  chemical  extracted  therefrom  to  be  shipped  after  Oct.  20,  1918.  The 
resolution  also  provided  that  henceforth  no  licenses  were  to  be  issued  for  the  importa- 
tion of  these  commodities  excepting  for  shipments  consigned  to  the  United  States 
Steel  Products  Co.  On  Nov.  1  this  resolution  was  modified  to  permit  the  importation 
of  these  commodities  excepting  pig  iin,  provided  the  bills  of  lading  were  indorsed  to 
the  American  Iron  and  Steel  Institute.  Pig  tin  bought  Sept.  30,  however,  could 
still  be  imported  only  by  the  United  States  Steel  Products  Co.  The  original  resolution 
had  been  passed  at  the  request  of  the  inter-allied  tin  executive  in  London  to  effect  an 
equitable  distribution  of  pig  tin.  With  the  signing  of  the  armistice  the  value  of  this 
resolution  changed.  The  United  States  Steel  Products  Co.  alone  was  able  to  import 
pig  tin  and  this  company  already  had  more  pig  tin  than  it  could  sell  without  loss.  The 
market  price  for  tin  outside  of  the  United  States  had  broken  and  if  pig  iron  could  have 
been  imported  freely,  the  stocks  of  pig  tin  already  in  the  United  States  would  have 
fallen  greatly  in  value.  As  it  was,  the  fact  that  tin  ore  was  permitted  to  enter  gave 
the  smelters  an  opportunity  to  import  the  ore,  smelt  it,  and  put  the  pig  tin  on  the  mar- 
ket at  a  few  cents  below  the  price  at  which  pig  tin  was  being  held  by  the  United  States 
Steel  Products.  Co.  This  practice  caused  the  War  Trade  Board,  on  Jan.  30,  1919, 
to  pass  a  resolution  whereby  no  import  licenses  were  to  be  issued  for  any  metal  con- 
taining more  than  20  per  cent  of  tin.  This  measure  is  in  harmony  with  the  at- 
tempt which  was  being  made  to  keep  up  the  price  of  pig  tin  to  prevent  large  losses  to 
those  importers  who  previous  to  the  cessation  of  hostilities  had  purchased  large  stocks 
of  pig  tin  for  Government  purposes." 


GOVERNMENT   CONTROL   OVER  PRICES.  357 

lap  at  Calcutta,  the  primary  market,  but  took  no  effective  hand  to 
prevent  the  Calcutta  merchants  from  exacting  enormous  prices  from 
American  importers.  The  War  Trade  Board  accordingly,  on  October 
4,  1918,  passed  a  resolution  prohibiting  the  licensing  of  the  importa- 
tion of  burlap,  burlap  bags,  or  jute  without  the  approval  of  the  Food 
Administration  and  the  War  Industries  Board.  This  virtual  em- 
bargo broke  the  speculation  of  Calcutta,  it  would  seem,  for  the  base 
price  at  that  market  dropped  from  16.17  cents  per  pound  on  October 
2  to  9.79  cents  on  December  28,  1918. 

RUBBER. 

The  United  States  in  the  early  years  of  the  World  War  was  de- 
pendent in  large  part  upon  the  various  warring  countries  or  their 
colonies  for  many  essential  raw  materials.  One  of  the  most  important 
of  these  was  rubber,  a  considerable  portion  of  which  came  from  the 
English  and  Dutch  possessions  in  the  Far  East. 

The  British  embargo  of  1914.. — When  war  first  broke  out  in 
August,  1914,  tires  were  the  only  important  rubber  products  which 
were  made  contraband.  In  the  following  month  the  British  Gov- 
ernment added  crude  rubber  to  the  list  of  contraband  and  decreed 
that  rubber  could  be  exported  only  to  certain  ports  of  Europe, 
namely,  those  of  France,  Belgium,  Eussia,  Spain,  and  Portugal.  In 
October  the  French  Government  followed  suit  and  declared  rubber 
absolute  contraband.  But  Great  Britain,  late  in  October,  issued  an 
order  forbidding  shipments  from  those  plantations  in  the  Far  East 
which  were  under  her  control  to  any  port  other  than  London,  thereby 
making  virtually  all  plantation  rubber  contraband.  Even  this  latter 
decree,  however,  did  not  seem  to  bring  the  desired  results,  and  finally 
during  the  last  days  of  October,  1914,  the  British  Government  forbade 
all  exports  of  crude  rubber  from  any  English  port.1 

As  a  result  of  these  restrictions,  rubber  prices  soared,  and  it  was 
said  that  the  cost  of  the  embargo  to  the  industry  was  $250,000  a 
day.2  After  several  advances  to  the  British  Government  the  embargo 
was  partially  lifted,  and  in  January,  1915,  shipments  of  rubber  to  the 
United  States  were  again  permitted,  but  not  without  restriction. 
First,  no  rubber  was  shipped  direct  to  any  American  consumer.  It 
was  consigned  directly  to  the  British  consul  general  in  New  York, 
and  he  alone  had  authority  to  release  it.  Secondly,  every  American 
buyer  before  securing  the  release  of  any  rubber  was  compelled  to 

1  The  reason  for  these  actions  on  the  part  of  Great  Britain  is  given  in  the  following 
extract  taken  from  the  India  Rubber  World  for  Nov.  1,  1914  : 

"  It  was  given  out  that  the  requirements  of  the  allied  armies  would  be  sufficient  to 
absorb  practically  the  whole  plantation  production  for  the  next  six  months.  It  was 
stated  that  the  British  and  French  military  authorities  would  need  a  new  equipment 
of  tires  for  the  quarter  million  motor  transport  vehicles  then  being  used  in  the  war, 
and  that  there  would  be  great  demand  for  waterproof  ground  sheets  for  the  troops, 
for  rubber  boots,  to  be  used  in  digging  trenches,  for  all  kinds  of  surgical  appliances, 

2  India  Rubber  World,  January,   1915. 


358  HISTORY   OF   PRICES   DURING   THE   WAR. 

guarantee  that  lie  would  not  reexport  except  under  specified  restric- 
tions and  would  not  use  it  in  trading  with  the  enemy.  This  rule 
not  only  applied  to  the  particular  rubber  which  he  wanted  to  have 
released,  but  to  all  the  rubber,  crude  or  manufactured,  which  he  had 
on  hand  or  might  dispose  of  during  the  war. 

This  was  the  state  of  affairs  as  regards  the  rubber  importer  at  the 
entrance  of  the  United  States  into  the  conflict.  Rubber  had  been  coin- 
ing into  the  country  in  tremendous  quantities  during  1916.  and  1917 
presaged  the  largest  imports  in  our  history.1 

The  licensing  of  rubier  imports. — On  November  28,  1917,  rubber 
was  put  on  the  restricted  list  by  presidential  proclamation  and  all 
imports  were  forbidden  except  under  license.  Thus  the  control  of 
American  imports  was  shifted  from  the  British  consul  general  at 
New  York  to  the  War  Trade  Board.  The  Rubber  Association  of 
America  was  virtually  appointed  the  agent  of  the  United  States 
Government  and  undertook  to  collect  information  relative  to  the 
rubber  industry  for  the  War  Trade  Board;  to  act  as  consignee  for 
rubber  shipped  to  the  United  States;  to  release  rubber  to  importers 
under  instructions  from  the  War  Trade  Board;  to  obtain  from  im- 
porters and  manufacturers  guarantees  that  they  would  not  sell  any 
rubber,  directly  or  indirectly,  to  any  country  at  war  with  the  United 
States,  or  to  any  person,  unless  satisfied  that  there  was  no  intention 
of  exporting  without  an  export  license;  to  keep  informed  for  the 
benefit  of  the  War  Trade  Board  as  to  the  use  and  disposition  of 
the  imported  rubber;  and  to  keep  full  records  of  all  importations  of 
rubber.  No  restrictions  were  placed  on  the  amount  of  rubber  that 
could  be  imported,  and  throughout  the  first  few  months  of  the  year 
large  quantities  of  rubber  came  into  the  country. 

But  large  imports  of  rubber  meant  large  amounts  of  shipping 
space  and  long  hauls,  since  the  greater  portion  of  our  rubber  sup- 
plies come  from  the  Far  East  and  Brazil. 

The  restriction  of  rubber  imports  and  price  fixing. — The  military 
requirements  of  the  country  demanded  a  conservation  of  tonnage, 
however,  and  on  May  7,  1918,  after  conference  with  representatives  of 
the  War  Industries  Board,  the  United  States  Shipping  Board,  and 
the  rubber  industry,  the  War  Trade  Board  restricted  the  quantity 
of  rubber  to  be  licensed  for  import  during  the  three-month  period, 
May,  June,  and  July,  to  25,000  long  tons.  This  was  at  the  rate  of 
100,000  tons  per  year,  or  about  two-thirds  of  the  1917  importation 
of  157,  000  tons.2  It  was  naturally  expected  that  this  cutting  off  of 

1  Indeed,    our    rubber    imports    for    1917    proved    to    be   over    167,000    tons,    as   against 
115,000  tons,   in   1916  and   103,000   tons  in  1915.      See  War   Industries   Board   Bulletin, 
"  Prices  of  Rubber  and  Rubber  Products,"  by  Isador  Lubin. 

2  Subsequently,   the   War  Trade   Board  virtually   increased   the  amount   to   be  licensed 
for  import  to   28,000  long  tons    (green  basis)    per  quarter  by  ruling  that  the  Brazilian 
imports   should  be  allocated   on   a    dry   basis  which  allowed   approximately    12    per   cent 
for  water  content. 


GOVERNMENT    CONTROL   OVER  PRICES.  359 

an  appreciable  part  of  our  supply  would  start  rubber  prices  up- 
ward, and,  indeed,  a  speculative  market  did  develop  as  soon  as 
word  was  received  that  the  restriction  of  the  importation  of  rubber 
was  contemplated.1 

As  a  preliminary  step  therefore  to  the  restrictions  of  rubber  im- 
ports, the  War  Trade  Board  inaugurated  an  option  system  whereby 
it  regulated  rubber  prices  from  the  time  of  import  until  passing  into 
the  hands  of  the  manufacturer.  A  maximum  price,  based  on  quota- 
tions current  in  the  trade  when  restrictions  were  first  considered,  was 
fixed  for  the  various  types  of  crude  rubber,  and  the  possibilities  of 
profiteering  and  speculation  were  limited.  These  prices,  fixed  on 
May  1,  c.  i.^FrNejw  York  were  as  follows : 

Cents  per 
pound.2 

Para  Upriver  Fine 68 

Plantation : 

First  Latex  Cr§pe 63 

Smoked   sheets    (standard) 62 

All  importers  before  securing  an  import  license  were  compelled  to 
give  to  the  United  States  Government  an  option  on  "  all  or  any  part 
of  the  crude  rubber "  covered  by  the  license,  as  well  as  on  all  other 
crude  rubber  at  that  time  or  thereafter  covered  or  controlled  by  the 
applicant  until  sold  and  delivered  to  a  manufacturer.3 

In  the  event  of  the  exercise  of  this  option  the  prices  to  be  paid  by 
the  Government  were  to  be  those  mentioned  above. 

The  results  of  the  embargo. — It  appears  that  this  fixing  of  rubber 
prices  was  an  unnecessary  expedient,  however,  since  the  curtailment 
of  imports  had  little  effect  upon  the  rubber  supply  of  the  country. 
For,  first,  the  stocks  on  hand  on  April  1,  were  the  largest  in  the 
history  of  the  industry,4  and,  second,  our  imports  during  May,  June, 
and  July  were  much  larger  than  the  specified  25,000  tons.  The  pre- 
liminary negotiations  leading  to  the  cutting  of  imports  had  been 
held  in  April,  and  the  anticipation  by  the  trade  of  some  form  of  re- 
strictions stimulated  buying.  Large  contracts  were  therefore  entered 
into  for  the  immediate  shipment  of  rubber  to  the  United  States  in 
order  that  stocks  might  be  accumulated  before  the  expected  restric- 
tions went  into  effect.  The  restrictions  of  May  8  did  not  apply  to 
shipments  which  had  left  foreign  ports  prior  to  that  date,  and  since 
the  time  required  for  transporting  rubber  from  primary  markets  to 

1  Compare  chart  of  crude   rubber  prices  in   "  Prices  of  Rubber  and  Rubber  Products," 
as  above. 

2  Tbese   prices   were   supplemented   on   May    14   by   maximum  prices   for  other   grades 
of  crude  rubber ;  while  on  May  29,  June  13,  July  2,  and  July  G,  respectively,  still  further 
additions  were  made.     Applicants  for  import  licenses  had  to  guarantee  that  they  would 
not  sell  rubber  covered  by  their  license  to  or  for  any  person  at  a  price  higher  than  the 
fixed  prices. 

8  Compare  letter  from  the  War  Trade  Board  to  the  Rubber  Association  of  America  on 
Apr.  30,  1918,  in  the  War  Trade  Board  Journal  of  June,  1918. 

*  Compare  statement  by  Bertram  G.  Work,  chairman  of  the  War  Service  Committee 
of  the  rubber  industry  in  the  India  Rubber  World,  June,  1918. 


360  HISTORY   OF   PRICES   DURING   THE   WAR. 

the  United  States  was  considerable  the  actual  imports  during  the 
second  quarter  of  1918  were  much  greater  than  the  specified  25,000 
tons.  Indeed,  55,000  tons  of  rubber  entered  American  ports  during 
May,  June,  and  July. 

Finally,  the  curtailment  of  the  American  receipts  was  immediately 
felt  in  the  primary  markets,  where  already  the  decreased  consump- 
tion of  other  nations  had  had  its  effects.  The  further  elimination  of 
means  of  disposal  naturally  led  to  keen  competition  among  the  hold- 
ers of  the  existing  large  stocks  and  prices  tended  to  fall  even  below 
the  existing  low  level. 

The  result  then  was  that  allocated  Upriver  Para  rubber  sold  in 
September  for  58  cents  per  pound  and  Plantation  First  Latex  Crepe 
sold  for  37  cent's  per  pound1  as  compared  with  the  fixed  maxima 
respectively  of  68  cents  and  63  cents.  On  December  12,  restrictions 
as  to  the  amount  of  rubber  to  be  licensed  for  import  from  overseas 
were  withdrawn  as  were  also  the  maximum  price  and  allocation 
features  of  the  import  regulations. 

SILK. 

The  second  presidential  proclamation  on  imports,  issued  Febru- 
ary 14,  1918,  included  silk  among  the  commodities  for  which  import 
licenses  were  to  be  required. 

In  order  to  discourage  imports  for  speculative  purposes,  the  War 
Trade  Board,  on  September  3,  1918,  revoked  all  outstanding  licenses 
for  the  importation  of  silk  noils,  silk  noil  yarn,  garnetted  stock, 
silk  waste,  spun  silk,  and  pierced  cocoons  for  shipment  after  Sep- 
tember 10.  The  United  States  Government  was  to  have  an  option 
to  purchase  all  silk  of  the  above  varieties  for  which  import  licenses 
were  issued  after  September  3,  at  a  price  2  per  cent  above  the 
cost  at  the  foreign  ports  of  shipment,  including  all  charges  except 
prepaid  freight  and  prepaid  insurance. 

1  This  variation  in  the  price  of  the  two  types  of  rubber  is  to  be  explained  by  changes 
which  were  made  in  the  import  program  in  August  and  September.  The  War  Trade 
Board  had  at  first  failed  to  make  allowance  for  the  large  amount  of  water  in  Brazilian 
rubber  and  the  high  price  of  this  type  of  rubber  resulted  in  the  American  consumer 
giving  preference  to  rubber  from  the  Far  East,  and  imports  from  Brazil  decreased 
steadily  from  June  to  August.  The  former  factor  was  eliminated  about  a  month 
after  import  restrictions  became  effective,  and  in  order  to  further  stimulate  the  im- 
portation of  Brazilian  rubber  the  War  Trade  Board  ruled  in  early  August  that  during 
the  months  of  August  and  September  rubber  importers  should  replace  50  per  cent  of  the 
rubber  utilized  in  Government  contracts  by  Brazilian  rubber.  The  result  of  these  pro- 
visions for  stimulating  imports  became  apparent  in  September,  and  imports  from  Brazil 
increased  54  per  cent  over  the  month  of  August.  The  results  attained,  however,  were 
not  up  to  expectations,  and  on  Sept.  26,  the  ruling  relative  to  the  use  of  Brazilian 
rubber  was  supplanted  by  ail  order  of  the  War  Trade  Board  requiring  that  at  least 
one-fourth  of  the  total  amount  of  imports  authorized  should  be  licensed  from  South 
and  Central  America.  With  the  production  of  the  Plantations  over  six  times  as  large 
as  that  of  South  America,  these  regulations  led  to  a  heavy  oversupply  of  the  Planta- 
tion variety  of  rubber  and  keener  bidding  at  Plantation  markets  for  the  right  to  ship 
to  American  ports.  It  should  be  added  also  that  the  maintenance  of  relatively  normal 
values  by  Brazilian  rubber  was  in  part  to  be  accounted  for  by  the  stabilizing  control 
over  its  price  by  the  Bank  of  Brazil. 


7.  THE  WAR  DEPARTMENT. 

The  War  Department  expended  $14,244,061,000  from  the  declara- 
tion of  war  in  this  country  to  April  30,  1919,  and  was  given  a  hand  in 
the  general  price-fixing  program  by  reason  of  its  interest  in  Army 
purchases.1  The  large  purchases  which  the  War  Department  began 
making  soon  after  April  6,  1917,  indeed,  and  the  erratic  behavior  of 
the  market,  were  among  the  main  causes  for  the  control  over  raw- 
material  prices  by  the  Government. 

The  quantity  of  goods  required  to  feed  and  clothe  the  Army  was 
great  enough  vitally  to  affect  market  quotations.  The  statistics 
branch  of  the  General  Staff  has  estimated  the  total  purchase  by  the 
Army  for  subsistence  from  April  2,  1917,  to  May  3,  1919,  as  $1,093, 
636,623.2  The  total  Army  purchases  for  clothing  from  the  beginning 
of  war  to  May  31,  1919  amounted  to  $1,212,066,018,  and  those  for 
equipage  to  $254,721,400.  There  follows  an  itemized  list  of  the 
clothing  commodities  purchased  by  the  War  Department  from 
the  beginning  of  war  to  May  31,  1919,  and  the  unit  price  for  each 
commodity,  as  given  by  the  statistics  branch  of  the  General  Staff. 
A  similarly  itemized  list  for  the  equipage  purchased  follows. 

SUBSISTENCE    SHIPPED    TO    AMERICAN    EXPEDITIONARY     FORCES   APR.    1,  1917,  TO 

DEC.  1,  1918. 


Item. 

Quantity 
(pounds  unless 
otherwise 
specified). 

Unit 
price. 

Total  cost. 

Bacon                        

147,956,223 

$0.  44 

$65,  722,  154 

250,  584,  692 

.23 

58,  536,  584 

Beef  tinned  .      ,  

140,843,476 

.32 

45,717,792 

Flour 

542,  874,  797 

.05 

28,  500,  927 

27.  449,  645 

.67 

18,407,732 

Cigarettes  each.  .        

2,  439,  260,  097 

.0-06 

15,123,412 

Reserve  rations  each                                             

15,623,150 

.76 

11,875,594 

106,169,345 

.07 

7,888,382 

Cigars  each                                

160,  180,  225 

.05 

7,  768,  741 

Butter  and  substitutes.                                             

16,  200,  799 

.40 

6,433,337 

100  081  789 

.06 

6.  024.  924 

Beans,  baked  

54,731,786 

.10 

5.226,886 

j&ni                                                                               

26,  029,  028 

.19 

4,877,840 

Colfee 

39  185,167 

.  12 

A,  729,  650 

Milk  .  evanorated  .  .  . 

42,  922,  743 

.11 

4,498,303 

1  See    "  The   War   with   Germany,"    prepared   under   the   direction   of   Coi.    Leonard   P. 
Ayers,   of  the  statistics   branch   of   the   General    Staff,    for   an    itemizatiou    of   these   ex- 
penditures. 

2  There  is  not  available  an  itemized  list  of  the  commodities  that  made  up  this  total 
expenditure  fo-r  foods,   and   their  unit  costs.     There  follows,   however,   a   table  showing 
the  individual  commodities  shipped  to  the  American   Expeditionary  Forces  from   Apr.   1, 
1917,   to  Dec.   1,   1918,  as   reported   by   the   statistics   branch   of  the   General   Staff,   and 
the  unit  price   of  each.      Later   figures  given   out  by   the   Staff,   which  do  not  have   the 
advantage   of   carrying   unit   costs,    show   that  the   total   expenditures    for   overseas    sub- 
sistence from  the  beginning  of  war  to  May  1,  1919,  was  $616,134,000. 


»fclSL 


361 


362 


HISTORY   OF  PRICES   DURING  THE   WAR. 


SUBSISTENCE   SHIPPED   TO   AMERICAN   EXPEDITIONARY  FORCES  APR.   1,   1917,  TO 

DEC.  1,  1918— Continued. 


Item. 

Quantity 
(pounds  unless 
otherwise 
specified). 

Unit. 
price. 

Total  cost. 

Fish  salmon 

30  961  801 

14 

4  408  960 

Beans,  dry  

39  646  677 

.11 

4*  297*  700 

Vegetables  dehydrated 

12  971  935 

30 

3*924  01  0 

Lard  and  substitutes  

15  781  228 

.25 

3  861  666 

Syrup,  gallons.  .  . 

6  171  80S 

.59 

3  654  945 

Hard  bread  

27  978  830 

.13 

3  614  865 

Candy.   . 

7  895  053 

.28 

2  191  667 

Rice.,  

25.  466.  547 

.08 

2'  029'  684 

Prunes  .  . 

15  748  931 

.10 

1  630  014 

Fruit  evaporated 

8  976  848 

13 

1  191  228 

Cornmeal  

16'  074'  687 

.05 

736  221 

Pickles,  gallons  

1.333,210 

.47 

625  809 

Ham 

1  772  917 

.34 

610  238 

Corn,  sweet  

7.  639,  786 

.06 

431  648 

Emergency  rations,  each.  .  . 

765  400 

.53 

401  835 

Vinegar  gallons 

1  319  877 

.28 

367  586 

Oatmeal  

4  661  732 

.06 

296  020 

Peas  green 

4  689  425 

06 

262  608 

Peaches,  canned    . 

2  415  182 

.11 

255'  043 

Hominy  

1,826,269 

.09 

155,  963 

Beans,  stringless.. 

2,  148,  759 

.06 

127  207 

Salt 

13  707  276 

.009 

120  624 

Pears,  canned      

1,150,120 

.10 

117*542 

Apples  canned 

1  831  096 

.06 

117  007 

Cheese  

314,  203 

.28 

87'  191 

Pineapples,  canned 

899  25S 

.09 

82  012 

Apricots,  canned  

863,415 

.09 

78  743 

Cherries,  canned. 

423  444 

.12 

51  703 

Total 

327  059  997 

CLOTHING  PURCHASED  BY  THE  ARMY  DURING  THE  WAR. 


Breeches  and  trousers,  wool 

21,768,220 
14,154,000 
2,964,932 
10,867,000 
5,741,012 
8,872,000 
10,942,000 
13,870,000 
41,089,000 
42,468,360 
8,220,000 
12,494,000 
8,315,000 
26,547,817 
18,769,648 
11,847,000 
20,210,000 
58,712,000 
61,243,000 
11,561,505 
48,110,000 
36,931,000 
16,771,000 
8,481,000 
'     6,235,000 
2,236,000 
635,000 
7,254,000 
2,632,000 
5,007,000 
9,357,000 
17,283,000 
9,927,000 
873,000 
868,000 
1,220,000 

S6.70 
1.69 
5.08 
.23 
.88 
1.96 
1.55 
9.79 
.50 
2.00 
2.00 
.92 
12.17 
3.50 
7.45 
4.65 
.16 
.55 
.35 
1.55 
.60 
2.00 
2.20 
5.21 
.24 
7.50 
14.00 
1.07 
.48 
.46 
1.16 
.65 
.25 
2.52 
2.58 
.75 

5145,847,074 
23,920,260 
•15,061,854 
2,499,410 
5,052,090 
17,389,120 
16,960,100 
135,787,300 
20,544,500 
84,936,720 
16,440,000 
11,494,480 
101,193,550 
92,917,359 
139,833,878 
55,088,550 
3,233,600 
32,291,600 
21,435,050 
17,920,333 
28,866,000 
73,862,000 
3t>,  896,  200 
44,186,010 
1,496,400 
16,770,000 
8,890,000 
7,761,780 
1,263,360 
2,303,220 
10,854,120 
11,233,950 
2,481,750 
2,199,960 
2,239,440 
915,000 

Breeches,  cotton  

Boots,  rubber 

Belts,  waist  .  .  . 

Caps,  overseas 

Coats,  cotton  

Coats,  denim 

Coats,  wool..          

Drawers  summer 

Drawers,  winter  

Hats,  service 

Leggins,  canvas  

Overcoats 

Shirts,  flannel  

Shoes/field  

Shoes,  marching 

Stockings,  cot  ton  

Stockings^  wool  heavy 

Stockings,  wool,  light  

Trousers  denim 

Undershirts,  summer  ...                          .                

Undershirts  winter 

Puttees                               .                   .                       

Raincoats 

Hats,  denim                                           ...                

Jerkins 

Mackinaws                                                                    

Gloves,  leather  

Gloves  canton  flannel,  Ip  .                                          

Mittens,  canton  flannel  

Mittens  leather                                                            

Gloves  wool 

Gloves  jersey  knit                                                        

Oilskin  coats 

Oilskin  trousers                                                      

Oilskin  hats  

Total 

1,212,066,018 

Purchased. 


Unit 
price. 


Approximate 
value. 


GOVER^MEXT   CONTROL   OVER   PRICES.  363 

EQUIPAGE  PURCHASED  BY  THE  ARMY  DURING  THE  WAR. 


Purchased. 

Unit 
prica. 

Approximate 
value. 

Barracks  bags  !           8,  982,  000 

$0.85 

$7,634,700 

Bedsocks.                                 ...                     .                                        9,581,000 

1  10 

10  539  100 

Blankets  com 

6  00 

Blankets,  3  pounds  14,167,000 

6.50 

92,085  500 

Blankets,  4  pounds                                                                                          7,  106,  000 

8  00 

56  848  000 

Tents,  hospital,  drop  :                  8,090 

92.18 

745,736 

Tents,  hospital,  ward.                      .                              .                  •                21,142 

227  19 

4  803  251 

Tents,  pyramidal  500,  341 

76.  73 

38,391,165 

Tents,  shelter,  halves..                 '           7,499,437 

2  62 

19,648,525 

Tents  storage                                                                                                   21,108 

136  11 

2  873  010 

Tents,  wall,  large  71,705 

80.08 

5,742,136 

Tents,  wall,  small     .                                                                        ;                76,  178 

43  71 

3,329  740 

Latrine  screeen  '                64,114 

18.73 

1,200,855 

Paulins,  large  145,  420 

72.69 

10,570,580 

Paulins,  extra  large                                                                          '                12,511 

Paiilins,  small  -  13,  R47 

22.65 

309,104 

Total  . 

254.721.400 

There  follows  a  summary  of  the  value  of  overseas  shipments  of 
quartermaster  material  in  the  main  from  April  6,  1917,  to  December 
1,  1918,  as  compiled  by  the  statistics  branch  of  the  General  Staff. 

Oversea*  shipments. 

Clothing,  equipage,  etc.,  shipped  with  troops $326,000.000 

Subsistence 327,  059,  997 

Clothing __„  269,  451,  890 

Forage 21 ,106, 138 

Remount $15,  219,  878 

Fuel 12,  608,  353 

General  supplies 11,807, 118 

Horse-drawn  vehicles 7,  247,  522 

Harness 4,  957,  993 

(i)   THE  ARMY  REPRESENTED  ON  THE  PRICE-FIXING  COMMITTEE. 

Virtually  every  instance  of  price  fixing  that  had  been  undertaken 
by  the  War  Industries  Board  prior  to  March,  1918,  had  its  incep- 
tion in  the  fact  of  large  Government  purchases  which  needed  pro- 
tection against  unstable  markets.  It  was  not  surprising,  therefore, 
that  when  the  price-fixing  committee  was  created  there  should  have 
been  appointed  to  it  a  representative  of  the  Army,  despite  the  fact  that 
the  President  in  his  letter  had  not  so  provided.1  It  was  the  duty  of 
the  representative  of  the  War  Department  to  present  to  the  com- 
mittee always  the  Army  point  of  view,  and  to  carry  back  to  the  Army 
that  of  the  committee. 

1  The  first  representative  of  the  Army  upon  the  price-fixing  committee  was  Brig. 
Gen.  Palmer  E.  Pierce,  but  Lieut.  Col.  R.  H.  Montgomery  served  in  that  capacity  from 
May  29,  1918  (S.  O.  126),  until  the  committee  resigned. 


364  HISTORY  OF   PRICES   DURING  THE  WAR. 

(2)   THE  PRICE-FIXING  SECTION. 

As  time  went  on  it  became  necessary  for  the  Army  to  determine 
fair  prices  for  its  own  purchases  upon  commodities  that  had  not 
been  fixed  by  the  price-fixing  committee.  It  frequently  had  occa- 
sion, for  example,  to  determine  differentials  from  the  base  prices  set 
by  the  price-fixing  committee  and  less  important  base  prices.  A  new 
order  was  accordingly  issued  by  the  War  Department  September  4, 
1918  (S.  C.  No.  88),  creating  a  price-fixing  section  within  the  Army, 
whose  chief  was  to  be  the  representative  of  the  Army  on  the  price- 
fixing  committee,  and  with  the  following  duties : 

To  conduct  inquiries  as  to  fair  prices  and  departure  from  sucii  prices,  to 
advise  agencies  of  the  War  Department  in  relation  thereto,  and  to  represent 
the  War  Department  on  the  price-fixing  committee  of  the  War  Industries 
Board. 

(3)   COMMANDEERING  AND   REQUISITIONING. 

It  was  not  always  possible  satisfactorily  to  secure  commodity  re- 
quirements from  the  market  at  prices  set  by  the  price-fixing  commit- 
tee or  the  price-fixing  section,  and  the  Army  resorted  frequently  to 
the  practice  of  commandeering  and  requisitioning.  The  comman- 
deer orders  were  compulsory  orders  to  manufacture  certain  products, 
and  the  requisition  orders  were  those  taking  over  properties  or  stocks 
for  use  by  the  Government.1 

A  considerable  confusion  arose  late  in  1917  and  early  in  1918  by 
reason  of  the  decentralization  of  seizure  orders,  and  on  March  22, 
1918  (General  Orders,  No.  27)  a  commandeering  section  was  estab- 
lished to  bring  uniformity  of  procedure  in  the  requisitioning  and 
commandeering  of  property.  There  had  been  164  different  requisi- 
tions issued  by  the  several  bureaus  of  the  War  Department  prior  to 
the  establishment  of  the  commandeering  section.  Another  341  requi- 
sitions, affecting  2,501  persons  or  companies,  were  issued  after  the 
creation  of  the  section.  There  had  been  370  compulsory  orders  is- 
sued prior  to  the  establishment  of  the  commandeering  section.  An- 
other 626  compulsory  orders,  affecting  732  persons  or  companies, 
were  issued  after  the  creation  of  the  section.  The  commandeering 
section,  in  its  report  following  the  signing  of  the  armistice,  esti- 
mated that  the  approximate  value  of  all  property  requisitioned  and 
secured  under  compulsory  order  was  $141,687,000.2 

1  The   main  authority   for   commandeering  was  had   from   section    120   of  the  national 
defense  act   (II.  R.   12766,  Public  No.  85),  approved  June  3,  1916;  and  that  for  requisi- 
tioning section  10  of  the  food  and  fuel  control  act  (H.  R.  4961,  Public  No.  41),  approved 
Aug.  10,  1917. 

2  There  follows  a  summary  and  itemized  list  of  properties  taken  for  military  purposes 
by  requisitioning  or  compulsory  orders,  during  the  war  : 

1.  Real  property,  improved  and  unimproved,  title  taken $15,  697,  000 

2.  Personal    property 125,990,000 


Total,  title  taken 141,687,000 


GOVERNMENT    CONTROL   OVER  PRICES.  365 

(4)   THE  BOARD  OF  APPRAISERS. 

The  duty  of  determining  compensation  for  properties  requisitioned 
or  commandeered  was  placed  upon  the,  board  of  appraisers,  estab- 
lished by  General  Orders,  No.  30,  on  April  1,  1918.  The  board,  as 
then  constituted,  was  composed  of  Lieut.  Col.  John  S.  Dean  and 
Lieut.  Col.  R.  H.  Montgomery,  and  was  given  the  following  duties: 

To  determine,  by  appropriate  methods,  just  compensation  of  all  properties  of 
whatever  kind,  real,  personal,  and  mixed,  for  the  seasons  of  occupancy  of  any 
property,  first,  which  shall  hereafter  during  the  existing  emergency  be  ordered 
requisitioned,  commandeered^  or  otherwise  formally  taken  over  according  to 
law,  through,  by,  or  by  direction  of,  the  Secretary  of  War  for  the  direct  and 
special  use  of  the  armies ;  or,  second,  which  has  heretofore,  during  the  present 
emergency,  been  directly  taken  over  and  the  determination,  of  just  compensa- 
tions for  which  has  not  been  concluded,  or  is  not  under  consideration  by  the 
special  board. 

To  determine  all  elements  of  valuation,  in  all  useful  or  necessary  phases  of 
such  valuation,  included  as  items  of  cost  in  any  contract  in  which  such  ele- 
ments affect  the  rights  and  obligations  of  the  Government  and  which  shall 

3.  Real    property    (improved  and   unimproved,   including   plants    and   trans- 

portation facilities)  use  and  occupation  taken  (value  per  annum) 3,146,000 

4.  Personal    property     (vessels),    use    and    occupation     taken     (value    per 

annum) 126,  047,  000 


Total,  use  and  occupation  taken    (value  per  annum) 129,193,000 

The  more  important  of  the  commodities  that  were  taken  through  requisitioning  or 
compulsory  orders  by  the  War  Department,  found  by  segregating  the  items  classified 
under  personal  property,  follow  in  order  of  their  values. 

1.  Cotton  goods,  silks,  gauze,  etc $56,  086,  700 

2.  Toluol 17,  211,  600 

3.  Wood    chemicals 16,092,200 

4.  Platinum 9,  747,  2QO 

5.  Subsistence     supplies 6,  854,  300 

(5.  Machine  guns  and  ammunition 5,  720,  500 

7.  Caustic    soda— 2,899,300 

8.  Nitrate    of   soda 2,598,700 

9.  Spruce 1,  124,  300 

10.  Carbon    tetrachloride 1,110,100 

11.  Machine   tools 975,200 

12.  Folding   steel   hospital   beds 750,000 

13.  Bleach    powder 590,000 

14.  Building  materials 551,800 

15.  Machinery 289,  900 

10.  Thermometers 284,  900 

17.  Typewriter  ribbon   cloth 269,900 

18.  Acetylene     cylinders '. 260,400 

19.  Phenol 250,  700 

20.  Tin 227,900 

21.  Locomotive    cranes . ; 203,200 

22.  Chestnut  extract 189,900 

23.  Steel    wire 169,200 

24.  Sulphate   of   ammonia 124,700 

25.  Boilers , 115,  000 

26.  Leather  gloves 71,700 

27.  Brass ^ 66,  100 

28.  Sulphuric    acid ' 64,000 

29.  Dimethylaniline 33,  900 

30.  Tapioca    flour 29,400 

31.  Miscellaneous...  26,  200 


366  HISTORY   OF   PRICES   DURING   THE   WAR. 

hereafter  during  the  present  emergency  be  entered  into  by  the  bureau  of  the 
War  Department,  or  any  official  of  any  such  bureau  whenever  the  contract  itself 
shall  not  provide  for  and  require  a  different  method  of  determination;  and 
likewise  to  determine  such  elements  included  in  any  such  contract  hereinbefore 
entered  into  during  the  present  emergency  where  such  determination  is  not 
otherwise  provided  for  or  required,  or  has  not  been  concluded,  or  is  not  the 
subject  of  consideration  by  the  special  board. 

The  board  of  appraisers,  between  April  1,  1918,  and  November 
22,  1918,  was  presented  with  1,147  different  requisition  compulsory 
orders  and  clearances  for  the  determination  of  a  just  value. 


8.  THE  NAVY  DEPARTMENT. 

The  Navy  Department  had  no  more  authority  than  the  War  De^ 
partment  for  fixing  the  prices  of  commodities  to  the  public.  It,  by 
virtue  of  the  enormous  purchases  for  its  own  supplies,  was  repre- 
sented on  the  price-fixing  committee  and  the  commodity  sections  of 
the  War  Industries  Board.  The  purchasing  of  supplies  for  the 
Navy  was  concentrated  on  the  Bureau  of  Supplies  and  Accounts, 
which  undertook  frequently  to  determine  "  fair  and  reasonable " 
prices.1 

(i)   COMMODITIES  PURCHASED  BY  THE  NAVY. 

The  bulk  of  purchases  made  by  the  Navy  during  the  war,  like 
those  made  by  the  Army,  was  a  considerable  factor  in  prompting  the 
price-fixing  committee  and  the  War  Industries  Board  to  extend  con- 
trol over  certain  commodities.  The  Navy  purchased  a  quantity  of 
nonferrous  metals  amounting  in  value  to  $71,218,289 ;  steel  and  iron 
valued  at  $91,846,654;  woolens  and  equipment  valued  at  $96,400,000; 
lumber  valued  at  $5,918,822:  provisions  (obtained  through  alloca- 
tion) valued  at  $7,427,260;  and  chemicals  and  explosives  valued 
at  $100,827,611. 

There  follows  a  summary  of  the  volume  of  purchases  made  by  the 
Navy  of  the  more  important  commodities,  as  recorded  in  the  annual 
report  of  the  Paymaster  General  for  1918 : 

NONFERROUS  METALS. 

i  ': 

Commodity 


Copper 

150,031,  522  pounds... 
24.833,000  pounds 

$35,  2o7.  407.  67 
1,800,392.50 
1,184,320.00 
28,632.41 
514,837.13 
7,750,884.36 
83,  560.  00 
5,997,251.96 
197,085.56 
1,980,403.24 
26,623,502.95 
9,798,010.00 

Lead.  .  . 

Tin                   ... 

1  850  500  pounds 

Antimony 

222  008  pounds 

Monel  metal  

1,263  404  pounds 

Steel  wire  rope 

85  105  281  pounds 

Nickel... 

219,900  pounds 

Zinc            

45  810  433  pounds 

Aluminum 

597  229  pounds 

Portland  cement 

1  151  098  barrels 

Copper  products         

7  '695*998  pounds 

Brass  products 

28  597  258  pounds 

71,218,289.78 

1  An  excellent  account  of  the  price  and  purchase  work  of  the  Navy  during  the  war 
to  the  summer  of   1918,   is  given  in   the  Annual   Report  of  the   Paymaster   General   of 
the  Navy  for  the  fiscal  year  1918. 

2  Ex-copper  furnished  by  Government ;  value,  including  copper  furnished  by  Government, 
$10,695.60. 

367 


368 


HISTORY   OF  PRICES  DURING  THE   WAR. 
STEEL  AND  IRON. 


Commodity. 

Quantity. 

Value. 

Steel        

517  828  000  pounds 

$20  790  356  98 

Forgings  and  ingots  

50,943,104  pounds 

16  417  288  00 

Anchors      

1  294  667  00 

Chain  iron 

10  000  000  pounds 

'  562'  500'  00 

Castings     ... 

5,960  000  pounds 

628  020  00 

Pig  iron 

68  264  000  pounds 

1  012*018  00 

Rails  

26  280  000  pounds 

'633*000  00 

Mine  anchors  

40,000     

2  080  000.00 

Extender  mechanisms 

50000 

155  000  00 

Tin  plate 

194  768  pounds 

46  517  00 

Pipe       

1  188*322  67 

Iron  ore 

201  600  pounds 

587  70 

Tubing  

7,730,514  feet  

1,699,328.00 

Railroad  equipment  

2,037,742.00 

Machine  t  ools     

17  570  468  33 

Chain  

25,985,300  pounds  

2.600,060.00 

Armor  plate 

2,430,000  pounds 

483  600  00 

Bolts,  nuts,  and  rivets  

32,643,450  pounds  

2.131,504.00 

Hand  tools  

359  966  00 

Miscellaneous 

0  TB3'5  028  00 

Fittings  

930  681.00 

Alloy  steel 

8  090  000  00 

Tool  steel  

1,500  000.00 

91,846,654.68 

WOOLENS  AND  EQUIPMENT. 


Overcoating 

1  600  006  yards 

$9,000,000.00 
22,000,000.00 
5,000,000.00 
5,500,000.00 
1,500,000.00 
7,  500,  000.  00 

4,000,000.00 
7,  000,  000.  00 
8.000,000.00 
$500,000.00 
800,000.  00 
900,000.00 
900,000.00 
350,000.00 
150,000.00 

I      1,000,000.00 

75,000.00 
}      1,000,000.00 

900,000.00 
250,000.00 
$450,000.00 

}         800,000.00 
6,000,000.00 

1      1,  500,  000.  00 

2,000,000.00 
500,  000.  00 
4,000,000.00 

}      1,500,000.00 

850,  000.  00 
73,  000.  00 

1      1,000,000.00 
1          800,  000.  00 
300,000.00 

300,  000.  00 

Uniform  cloth 

7,000,000  yards         

Flannels  (billiard  cloth  scarlet  cloth  etc) 

2  063,000  yards 

Blankets  .                                     

735,000  yards  

Bunting 

4  285  000  yards 

Australian,  domestic,  and  South  American  wool 
(grease). 
Denim 

12,000,000^  yards  

14,800.000  yards  

Drill 

29,630  000  yards 

Canvas  and  duck 

10,000,000  yards        

Cotton  check  lining        

1  ,850,000  yards  

Surgical  gauze 

975,000  yards  

865  000  'pairs 

Mattress  ticking 

2,647,000  yards  

Nainsook 

1  736  000  yards 

Muslin 

800,000  yards  

Pillow  cases  

140,000  

Sheets 

230,000       

Sheeting        

1,500,000  yards  

Pajamas 

46,000  pairs  

Towels 

270  000                        

Toweling 

2,900,000  yards     

7  200  000  pounds 

Handkerchiefs 

3,850,000      

Twine 

865,000  pounds  

Thread 

1,000,000  spools  

Do 

320,000  cones  

Underwear 

2,335,000  suits  

Socks 

423,000  pairs  (heavy)  

Do 

1,940,000  pairs  (merino)  

Do 

2  500  000  pairs  (cotton)  

Jersevs 

475,000  

Watch  caps  

555,000  

Shoes  

885,000  pairs  

150  000  pairs  (  arctics)  

Do 

315,000  pairs  (boots)  

708,000  i  

Ribbon  

Grommets,  buttons,  and  other  accessories  

Mattresses  and  cots 

500,000  vards  
(50,000  gross  (grommets)  
<260  000  gross  (buttons) 

1770,000  (brushes  and  whisks)  .  .  . 

f  100,000  mattresses  

Burlap  hemp  and  kapok 

\  20,000  cots  
|300  000  yards  (burlap)  . 

•[290,000  pounds  (hemp)  

(400  000  pounds  (kapok) 

(150,000  yards  (netting)  
•(750  000  yards  (braid)  

(l5  000  spools  (tape)  . 

96,  400,  000.  00 

GOVERNMENT   CONTROL   OVER   PRICES. 

LUMBER. 


369 


Commodity. 

Quantity. 

Value. 

7'%  586  917  feet 

SI  838  086  01 

Douglas  fir 

22,972,560  feet  .  .  . 

'528*369  28 

North  Carolina  pine.  .  . 

12,683,  796  feet  

380'  513.  88 

Oak    .              

10,  4  10,0(16  feet  

884  855  61 

Spruce                                                     • 

9,  368,  500  feet 

374  740  00 

White  pine 

6,828,000  feet 

546'  240  00 

3  522  950  feet 

264*221  25 

Ash 

1,797.000  feet    . 

197  670  00 

Yellow-pine  decking 

1  432  000  feet 

143  200  00 

Redwood     .              .  . 

1,059,000  feet  

47'  655  00 

White  cedar 

1,056  000  feet.  . 

100'320  00 

Poplar 

1  016  000  feet 

8l'280  00 

Hemlock 

820,000  feet   ......... 

19'  824  00 

Beech,  birch,  and  maple  
Mahoganv  

445,000  feet  
362,800feet  

31.  150.  00 
90  700  OC 

Port  Orford  cedar  .      .       .  . 

245,000  feet   . 

24  500  00 

Maple 

112  000  feet 

8*960  00 

Basswood                  

90,000  feet  

6  300  00 

Sugar  pine- 

75  000  feet 

4  500  00 

Sitka  pine   

65,000  feet  

3*250  00 

Walnut   -                 

27,  000  feet 

4  050  00 

Laurel 

23  500  feet 

2'  115  00 

Hickory                     

15,500  feet  

2'  325  00 

Cherry 

1  000  feet 

140  00 

213  000  pounds 

10  650  00 

Crossties 

57,366  pieces    . 

7l'707  50 

Piling 

12  400  pieces    . 

173  600  00 

Juniper  poles     .                      ..... 

3,  500  pieces  

24'  500  00 

Douglas  fir  spars 

1,495  pieces 

44  850  00 

Spruce  poles 

1  425  pieces 

'855  00 

5,918,822.633 

PROVISIONS  (OBTAINED  THROUGH  ALLOCATION). 


Item. 

Quantity. 

Approximate 
value. 

Apples,  evaporated  

1,208,000  pounds  .. 

$163  120  00 

Apples,  tinned  . 

2,000,000  pounds      . 

127  600  00 

Apricots,  tinned  

2,660,000  pounds... 

230'  500.  00 

Beans,  lima,  dried  .... 

3,462,000  pounds 

415  440  00 

Beans,  navy   . 

15,000,000  pounds      . 

1  762  500  00 

Beans,  string  

3,978,000  pounds... 

358*900  00 

Catsup 

519  000  gallons 

519  000  00 

Corn,  tinned                 

6,630,000  pounds.             

552  500  00 

Peacnes  evaporated  .     ... 

728,  000  pounds 

72  800  00 

Peaches  tinned 

4  066  000  pounds 

361  400  00 

Pears,  tinned........ 

2,  885,000  pounds 

262*  850  00 

Prunes 

2  800  000  pounds 

553  650  00 

Pumpkin  

1,678,000  pounds  

67,800  00 

Salmon 

2,850  000  pounds 

415  700  00 

Sauerkraut 

2  782  000  pounds 

163  500  00 

Tomatoes  

13,  100,000  pounds  

900  000  00 

Peas  

6,000,000  pounds.  ... 

500  000  00 

7,427,260.00 


CHEMICALS  AND   EXPLOSIVES. 


t 

Commodity. 

Quantity. 

Value. 

Petroleum  

217  749  gallons 

$59  928  00 

Turpentine 

33  600  gallons 

20  477  00 

Linoleum  

182,464  square  yards.  . 

212  324  00 

Shellac  
Garnetlac  

9,000  pounds  
987  bags  

5,  130.  00 
69  700  00 

Varnish  

213,505  gallons  

151  819  70 

Paint  drier  . 

408  576  gallons 

123  663  00 

Lubricating  oil  

3,402,981  gallons... 

1,227,072  00 

Kerosene  oil  

444,  182  gallons    . 

88  201  (jO 

Sperrn  oil  

Linseed  oil  (boiled  and  raw)  

Lard 

31,  400  gallons  
201.626  gallons  

57  050  gallons 

53,668.00 
228,  743.  00 
53  387  00 

Costor  oil  

79  740  gallons 

160  340  00 

Miscellaneous  paints  

300  '  000  00 

Coke... 

13,294  tons  

105.881.00 

125547°—  2 


370 


HISTORY   OF   PRICES   DURING  THE   WAR. 
CHEMICALS    AND    EXPLOSIVES— Continued. 


Commodity. 

Quantity. 

Value. 

LXI'LOSIVES    (INCLUDING    RAW    MATERIALS    AND 
FREIGHT  WHEN  FURNISHED  BY  NAVY). 

TNT,  grade  '-A"  

10,527  000  pounds... 

85,633,500.00 
29,033,250.00 
13,  280,  400.  00 
32,068  892  70 

TNT  trade  "B" 

72  012  000  pounds 

TNx1.......             : 

30,000,000  pounds.:  

Smokeless  powder    .... 

59  800  000  pounds    .... 

Black  powder 

1  151  750  pounds 

208,664.50 
2,  904,  000.  00 
12,500.00 
18,000.00 
327,000.00 
391,756.00 

5,496.50 

720.  0-:.) 
86,  748.  26 
2,  720.  00 
57,020.70 
6,000.00 
1,980.00 
4,319.50 
28,745.00 
1,331.67 
7,  452.  00 
6,365.00 
45,  100.  00 
744,800.00 
30,  000.  00 
56,212.87 
27,  210.  00 
22,  080.  00 
16,  000.  00 
5,000.00 
.     22,  460.  00 
29,  898.  30 
21,678.00 
2,656.90 
350,594.00 
208,  807.  00 
540.  00 
7,  125.  00 
364,980.00 
11,500.00 
149,868.60 
2,573.75 
2,373.00 
16,593.31 
2,000.00 
2,  345.  50 
16,  560.  00 
3,004.00 
1,904.00 
5,  167.  50 
1,927.00 
156,543.75 
483,646.00 
11,129.30 
144,  774.  75 
3,827.24 
3,213.00 
322,579.00 
729,  433.  00 
333,  695.  00 
3,  569,  892.  00 
800,000.00 

97,500.00 
6,  159.  00 
13,177.50 

8,857.77 
97.50 

1,  666,  700.  00 
19,  076.  00 
804,  160.  00 
311,400.00 
53,520.00 
507,  750.  00 
41,797.00 
1,587,891.00 
152,  635.  25 

Ammonium  picrate 

4  550  000  pounds.     .     . 

Picric  acid 

20  000  pounds 

Tetryl  

2o'oOO  pounds   

Chemicals  for  gas  shells  (estimated) 

Priming  caps  

18  160  000  caps  

CHEMICALS. 

Acetone.  .  .  . 

14  100  pounds  .       .   . 

Aluminum,  sulphate 

40  000  pounds 

Ammonia  anhydrou  >  .  .  . 

305  000  pounds 

Ammonia  aqua 

34  000  pounds 

Ammonia  chloride  

506  800  pounds       

Amonium  phosphate 

40  000  pounds 

Barium  chlorate  

11  000  pounds  

Borax 

41  800  pounds 

Calcium  carbide  

762  000  pounds     

Calcium  chloride 

17  000  pounds 

Calcium  magnesium  chloride  

162  000  pounds   

Calcium  phosphide 

5  750  pounds 

Carbon  tetra-chloridc  

4io,000  pounds  

Cartridge  bag  cloth 

1  070  000  square  yards 

Diphen  vlaminc  

50  000  pounds   

Dope  dictate 

12  000  gallons 

Dope,  'litralc  

13  000  gallons  

Ethvl  chloride 

24  000  pounds 

Ethyl  chloride  drums   

400  pounds  ....          

Gas  carbon  dioxide 

150  000  pounds 

G  as  h  y  dr  ogen 

1  440  000  cubic  feet 

Gas  oxygen 

2'sio'ooO  cubic  feet     

Glue,  dry       

6*500  pounds  

Gluo  liquid 

1  150  gallons 

Glue,  marine  

606  000  gallons    

32  600  gallons 

Iron  reduced 

600  pounds          

75  000  pounds 

Nitrating  cotton 

4  200  000  pounds       

PbenylcincLoninic  acid          

10  000  ounces  

Platinum  and  iridium 

1  417  30  ounces 

Potassium  permanganate 

775  pounds      

Salicylic  acid 

1  500  pounds 

Soda  ash 

538  tons                  

Sodium  benzoate               

500  pounds     

Sodium  carbonate 

42  250  pounds                 

Sodium  chlorate 

92  000  pounds       

Sodium  cyanide  

11,  300  pounds  

Sodium  fluoride 

11  200  pounds  

Sodium  silicate              

127,000  pounds  

Soap  cleaning  and  polishing 

32,800  cakes       

1  706  500  pounds 

Soap  silt  water 

7*890  '000  pounds      

Soap  toilet 

35  000  pounds       

Soap,  washing  powder         

2,182,500  pounds  
12  136  ounces      

Silver  nitrate 

Zinc  dust 

35  700  pounds 

L/6ad  for  painting  purposes 

3  330  100  pounds    

Zinc  oxide                                  

6  565  993  pounds  

505  660  gallons      

Mercury 

33  993  flasks  4  

Sodium  nitrate  (for  Indianheod) 

10  000  long  tons                       

Acids: 
Carbolic 

250  000  pounds           

Hydrochloric 

205  800  pounds       

117  200  pounds 

Nitric 

55  658  pounds       

Oxalic 

200  pounds 

Sulphuric  — 
Fuming           .                    

35,100  tons  

66°  Baum.6 

1  156  780  pounds      

28  900  tons 

60°  Baum6 

17'  200  tons       

Carbon  electrodes 

800  electrodes  

Caustic  soda 

6  325  tons                  

580  000  pounds 

Ferroalloys 

Sulphur  

5,001.41  tons  

100,827,611.32 

GOVERNMENT   CONTROL   OVER   PRICES.  371 

(2)   REPRESENTATION   OF  THE  NAVY  UPON  THE  PRICE-FIXING 

COMMITTEE. 

The  Navy  was  represented  on  the  price-fixing  committee  by  Pay- 
master John  M.  Hancock,  whose  relation  to  it  was  like  that  of  the 
Army  representative  on  the  same  committee.  It  should  be  added 
that  the  task  of  making  Navy  purchases  was  expedited  by  the  forma- 
tion of  commodity  sections  within  the  Navy,  whose  chiefs  were 
members  of  and  participated  in  the  deliberations  of  the  commodity 
sections  of  the  War  Industries  Board. 

(3)   COMMANDEERING. 

In  peace-times  Navy  purchases  were  made  in  the  open  market, 
but  during  the  war  resort  was  frequently  had  to  commandeering 
and  mandatory  orders.1  The  scope  of  the  newly  created  naval 
board  of  commandeering  was  extended  on  February  1,  1918,  "to 
act  as  a  clearing  house  to  supply  all  the  Navy  with  information  at 
hand,  giving  consideration  to  quantities,  material,  prices,  suitability 
for  Navy  use,  and  other  data  relative  to  the  stores  produced."  The 
work  of  the  board  consisted  in  making  inventories  of  goods  of  in- 
terest to  the  Navy  stored  in  warehouses  and  held  by  banks  and  for- 
warding agents  for  export. 

The  Paymaster  General  gives  the  following  account  of  the  pro- 
cedure followed  by  the  Navy  in  taking  tin  at  a  time  when  the  market 
was  rising: 

In  the  fall  of  1917,  27,000  pounds  of  tin  were  urgently  needed.  The  tin 
market  was  jumping  out  of  bounds.  Several  dealers  were  called  upon  without 
result.  The  collector  of  customs  at  the  port  of  New  York  was  called  by  long 
distance  telephone.  He  advised  that  a  ship  was  in  with  a  cargo  of  250  tons 
consigned  to  three  companies.  The  13  tons  required  by  the  Navy  were  appor- 
tioned among  those  three  companies  and  the  tin  paid  for  at  64  cents  per  pound, 
the  approximate  value  before  the  market  began  to  rise.  With  this  beginning, 
arrangements  were  gradually  made  to  restrain  all  tin  warehoused  in  New 
York  found  to  meet  Navy  specifications.  Through  the  commandant  at  New 
York,  approximately  2,000  tons  were  placed  under  seal.  This  action  prompted  a 
dealer  to  place  at  the  Navy's  disposal  700  tons  additional,  which  was  con- 
tracted for  at  64  cents  per  pound,  the  market  price  at  that  time  being  80 
cents  per  pound. 

Provisions  were  secured  for  the  Navy  generally  by  allocation  or 
competition.  But  in  January,  1918,  it  became  necessary  to  obtain 
some  Kotinashi  (white)  and  Kintoki  (kidney)  beans  by  a  joint 

1  The  principal  statutes  relating  to  price  control,  and  authorizing  commandeering  and 
mandatory  orders  for  use  by  the  Navy  were  the  Naval  appropriation  act,  Public  No.  479 
of  Mar.  4,  1911,  and  succeeding  years  ;  naval  appropriation  act,  Mar.  4,  1917,  naval  en- 
gineering fund  (Public,  No.  391,  64th  Cong.)  ;  the  urgent  deficiency  act  of  June  15, 
1917 ;  the  food  and  fuel  act,  Public  No.  4,  65th  Cong.,  of  Aug.  10,  1917 ;  and  the 
naval  appropriation  act,  July  1,  1918  (Public  No,  182,  65th  Cong.). 


372  HISTORY   OF   PRICES   DURING  THE   WAR. 

Army  and  Navy  commandeer,  whereby  42,000,000  pounds  of  beans 
were  secured  in  California.  This  notable  instance  of  commandeer- 
ing, one  of  the  first  large  cases  of  food  sei/.ure  in  our  history,  was  the 
more  interesting  since  the  Navy  saved  to  itself  middlemen's  profits 
by  commandeering  the  cargo  by  a  radio  message  before  the  ships 
reached  port. 

Another  interesting  instance  of  control  was  that  exercised  by  the 
Navy  over  the  prices  of  canvas,  which  is  described  in  the  annual  re- 
port of  the  Paymaster  General  as  follows : 

Unusually  heavy  demands  for  certain  numbers  and  weights  of  canvas  and 
duck  in  the  fall  of  1917  made  it  necessary  for  the  Navy  to  go  into  the  market 
rather  heavily.  In  view  of  the  abnormally  high  prices  prevailing  in  the  com- 
mercial market,  manufacturers  were  apparently  unwilling  to  bid.  The  War  In- 
dustries Board  was  requested  to  provide  the  Navy  with  information  as  to  the 
mills  from  which  the  Navy  could  expect  deliveries  within  a  reasonably  short 
time.  When  this  complete  list  was  received,  mandatory  orders  were  issued 
with  a  provisional  price  set  at  the  figure  which  appeared  just  on  the  basis  of 
all  available  data  in  the  hands  of  the  Navy.  The  receipt  of  these  orders  at 
this  provisional  price  appeared  to  occasion  some  concern  in  the  industry  and 
drew  forth  replies  to  the  effect  that  the  material  could  not  be  supplied.  The 
Navy  referred  these  claims  of  inability  to  supply  to  the  subcommittee  of  the 
War  Industries  Board.  This  committee  had  stated,  at  the  time  of  furnishing 
the  Navy  with  the  information  used,  that  the  capacity  of  every  available  loom 
was  known  to  it.  The  protest  then  became  one  as  to  price,  the  industry  claim- 
ing that  the  material  could  be  supplied  but  that  the  Navy's  price  was  entirely 
unreasonable.  To  this  statement  the  Navy  replied  with  the  request  for  facts 
nnd  cost  figures  substantiating  the  claims  for  a  higher  price,  assuring  the  manu- 
facturers of  a  fair  profit  over  and  above  manufacturing  cost.  Owing  to  non- 
receipt  of  the  requested  figures,  the  case  lapsed.  Subsequently  the  war  service 
committee  of  the  cotton  industry  accepted  for  the  trade  a  price  practically 
identical  with  the  provisional  price  set  by  the  Navy.  Not  only  did  this  action 
save  money  directly  for  the  Navy,  but  it  also  served  as  an  anchor  for  Army  and 
civilian  purchases,  since  the  canvas  mills  were  obviously  unable  to  explain  any 
material  discrepancy  to  other  buyers  over  and  above  the  price  at  which  the 
Navy  was  obtaining  canvas. 

A  situation  similar  to  that  of  canvas  arose  with  regard  to  denim. 
When  the  manufacturer  asked  40  cents  a  yard  for  his  material,  the 
Navy  served  an  order  for  the  quantity  needed  at  about  34  cents — a 
difference  of  over  $120,000  from  his  quotation.  The  manufacturer 
finally  admitted  the  justice  of  the  Navy  price  and  requested  a  trans- 
fer from  a  Navy  order  to  a  voluntary  contract. 

(4)   THE  SUPPLY  OF  RAW  MATERIALS  TO  CONTRACTORS  BY  THE 

NAVY. 

One  of  the  unique  and  effective  methods  by  which  the  Navy  as- 
sured itself  of  the  completion  of  contracts  at  reasonable  rates  was 
its  practice  of  supplying  raw  materials  to  its  contracting  manufac- 
turers. The  Navy,  for  example,  bought  3,000,000  pounds  of  wool  in 


GOVERNMENT    CONTROL   OVER   PRICES.  373 

July,  1917,  and  offered  that  wool  to  its  cloth  contractors  at  a  reason- 
able price.  The  contractors  thus  were  in  a  position  to  ignore  ex- 
orbitant quotations  made  by  private  wool  dealers,  and  to  buy  of  the 
Government.  The  Navy's  holdings  generally  prevented  the  price  on 
contractors'  options  from  exceeding  the  price  set  by  the  Navy  on  its 
own  supply. 

In  a  like  manner  the  Navy  arranged  for  a  purchase  of  about 
25,000  bales  of  Australian  wool  from  the  British  Government. 
Since  the  trade  did  not  know  generally  how  small  an  amount  the 
Navy  had,  and  the  consequent  ease  with  which  it  could  be  exhausted, 
there  was  given  to  contractors  an  effective  weapon  for  making 
private  purchases  at  reasonable  figures.  It  was  estimated  that  the 
direct  saving  brought  about  by  this  wool  purchase  amounted  to 
$1,500,000. 

The  success  of  the  Xavy  with  its  original  small  wool  purchase 
became  the  basis  for  joint  action  by  the  war  agencies  in  importing 
foreign  wools  and  in  taking  over  the  entire  domestic  clip.1 

(5)   DETERMINATION  OF  "FAIR  AND  JUST"  PRICES. 

When  the  commodity  specialists  within  the  Xavy  found  that 
prices  quoted  by  bids  received  in  the  regular  openings  were  unjust, 
those  bids  were  rejected  and  a  Navy  mandatory  order  issued.  The 
work  later  followed  of  determining  a  "  just "  price  for  the  materials 
taken  by  seizure. 

In  the  determination  of  a  "  just "  price  the  Navy  made  extensive 
uses  of  cost  data  supplied  by  the  contractor,  the  Federal  Trade  Com- 
mission, or  opinions  expressed  by  the  commodity  sections  of  the 
War  Industries  Board.  A  Navy  accounting  officer  was  also  ordered 
to  the  plant  to  report  on  the  cost  of  manufacture.  The  Navy 
worked  out  with  remarkable  precision  the  factors  that  would  be 
allowed  as  costs,  and  endeavored  to  standardize  them. 

1  Annual  report  of  the  Paymaster  General  for  1918. 


g.  THE  FEDERAL  TRADE  COMMISSION. 

In  the  field  of  public  price  control  during  the  war  the  Federal 
Trade  Commission  has  performed  primarily  an  advisory  function 
by  collecting  and  interpreting  for  the  price-fixing  agencies  data  on 
costs  of  production.  In  the  case  of  news-print  paper,  however,  the 
activities  of  the  commission  have  extended  somewhat  further  and 
have  taken  the  form  of  administrative  control  over  prices. 

The  regulation  of  the  prices  of  news-print  paper  differs  materially 
from  the  instances  of  war-time  price  fixing,  in  that  the  need  for 
regulation  appeared  and  the  preliminary  steps  in  the  control  were 
taken  considerably  before  the  entry  of  this  country  into  the  war. 
On  April  24,  1916,  the  United  States  Senate,  impelled  by  the  receipt 
of  numerous  complaints  from  publishers,  adopted  the  following 
resolution : 

That  the  Trade  Commission  is  hereby  requested  to  inquire  into  the  increase 
of  the  price  of  print  paper  during  the  last  year,  and  ascertain  whether  or  not 
the  newspapers  of  the  United  States  are  being  subjected  to  unfai^  practices 
in  the  sale  of  print  paper.1 

Upon  the  passage  of  this  resolution  the  Federal  Trade  Commission 
undertook  an  investigation  into  the  prices  and  distribution  of  news- 
print paper.  Finally,  after  a  series  of  conferences  between  the 
manufacturers,  publishers,  and  the  commission,  at  a  conference  on 
January  26,  1917,  it  was  suggested  that  the  Federal  Trade  Commis- 
sion should  "  arbitrate  the  question  of  what  was  a  fair  and  reasonable 
price  for  the  sale  of  news-print  paper." '  This  the  commission  agreed 
to  do,  and  on  March  4,  1917,  the  prices  upon  which  it  had  determined 
were  announced  and  were  accepted  by  a  number  of  the  news-print 
paper  manufacturers  of  this  country  and  of  Canada. 

After  this  agreement  was  adopted  a  Federal  grand  jury  for  the 
southern  district  of  New  York  found  indictments  against  four  of 
the  signatories  to  the  agreement  for  violation  of  the  Sherman  anti- 
trust lawT.  These  signatories,  accordingly, .withdrew  from  the  agree- 
ment, which  soon  collapsed.  On  November  26,  1917,  a  newT  agree- 
ment was  made  between  Thomas  W.  Gregory,  Attorney  General  of 
the  United  States,  as  trustee,  and  certain  persons  and  corporations 
engaged  in  the  manufacture  and  sale  of  news-print  paper.  It  was 

1  S.  Res.  177,  64th  Cong.,  1st  sess.,  adapted  Apr.  24,  1916. 

2  Report  of  the  Federal  Trade  Commission  on  the  news-print  paper  industry,  June  13, 
1917. 

374 


GOVERNMENT    CONTROL   OVER  PRICES.  375 

provided  in  the  agreement  that  the  Federal  Trade  Commission 
should  fix  the  maximum  prices  and  terms  of  sale  of  the  output  of  the 
news-print  paper  of  the  10  signatory  companies  sold  to  purchasers 
in  the  United  States  for  the  duration  of  the  war  and  three  months 
thereafter. 

The  findings  and  awrard  of  the  Federal  Trade  Commission,  con- 
cerning prices  and  terms  of  contract  and  sale  of  news-print  paper, 
were  announced  on  June  18,  1918.  The  manufacturers  of  news-print 
paper,  parties  to  the  agreement,  considered  the  price-awards  too  low 
and  appealed  for  a  review  to  the  United  States  circuit  court.  The 
decision  of  this  court,  rendered  September  25,  1918,  in  the  main  sup- 
ported the  contentions  of  the  manufacturers  and  ordered  a  substan- 
tial increase  in  the  original  price  awards  of  the  commission.  The 
detailed  awards  and  price  schedules  are  reprinted  in  the  second  part 
of  this  study,  which  contains  the  rules  and  regulations  affecting 
prices  adopted  by  various  governmental  agencies. 


io.  THE  DEPARTMENT  OF  AGRICULTURE. 

Distinct  lines  of  service  for  the  Food  Administration  and  the 
Department  of  Agriculture  were  clearly  drawn  at  the  outset  in  order 
that  neither  should  intrude  upon  the  field  of  the  other.  The  De- 
partment of  Agriculture  undertook  the  stimulation  and  supervision 
of  the  production  of  foodstuffs,  and  the  Food  Administration  that  of 
providing  for  distribution.  It  was  intended,  of  course,  that  many 
rules  of  the  Food  Administration  should  work  for  a  vital  increase 
of  production.  But  measures  which  related  to  the  producer  in  the 
main  were  administered  strictly  by  the  Department  of  Agriculture. 

Little  occasion  arose  for  direct  administrative  action  on  the  part 
of  the  Department  of  Agriculture  which  might  be  ascribed  to  the 
emergency  conditions  arising  from  the  war.  The  only  approach  to 
regulation  which  can  be  considered  as  coming  within  the  scope  of 
the  food  law  and  which  related  to  prices  took  place  in  connection 
with  fertilizers  and  farm  equipment. 

(i)   THE  CONTROL  OF  FARM  EQUIPMENT. 

The  food  supply  of  the  world  is  peculiarly  dependent  upon  the 
adequate  production  of  farm  equipment,  and  it  was  necessary  to 
stimulate  production  of  farm  implements  without  too  greatly  in- 
creasing their  prices  to  the  producer. 

Farm  implements  were  caught  in  the  current  of  rising  prices 
because  of  the  rising  cost  of  raw  materials  and  labor,  and  by  the 
latter  part  of  1917  their  prices  were  climbing  at  an  extraordinary 
rate,1 

The  American  farmers  became  disturbed  and  complained  that 
prices  were  unduly  high.  Moreover,  there  were  many  difficulties 
encountered  in  securing  certain  farm  machinery.  The  needs  of  the 
hour,  however,  were  too  acute  to  allow  any  disorganization  or  delay 
in  the  production  of  foodstuffs,  and  it  became  apparent  that  govern- 

1  The  following  index  of  farm  implement  prices,  based  on  the  average  price  of  1911, 
•which  is  made  equal  to  100,  shows  the  price  situation  in  the  farm  implement  industry 
during  1917  and  early  1918  : 


1911 

1912 

1913 

1914 

1915 

1916 

1917 

1918 

Mav              

100 

100 

96 

101 

100 

102 

126 

170 

October 

100 

100 

100 

100 

101 

119 

151 

Data  from  Bulletin  847,  United  States  Food  Administration,  statistical  division,  infor- 
mation service. 

376 


GOVERNMENT   CONTROL,   OVER   PRICES.  377 

mental  regulation  of  the  industry  would  be  necessary  to  alleviate 
the  situation.1 

Accordingly,  under  the  license  provision  of  the  Food  Administra- 
tion, the  President  required  all  importers,  manufacturers,  stores, 
and  distributors 2  of  "  tools,  utensils,  implements,  machinery,  and 
certain  other  farm  equipment  to  secure  Federal  licenses  not  later 
than  June  20,  1918,"  and  the  execution  of  the  provisions  and  regula- 
tions thereunder  were  placed  in  the  hands  of  the  Secretary  of  Agri- 
culture. 

Under  the  regulations  promulgated  for  the  industry  all  records 
and  property  of  licensees  were  subject  to  examination  by  representa- 
tives of  the  Secretary  of  Agriculture.  Eesales  within  the  trade  were 
specifically  prohibited  to  prevent  any  increase  in  the  price  of  the 
product  resulting  from  unnecessary  sales. 

Beyond  this  requirement  no  direct  regulation  of  prices  was  put 
into  effect.  The  Department  of  Agriculture,  however,  had  the  power 
to  prevent  unfair  "  commissions,  profits,  or  practices,"  and  ruled 
that— 

A  licensee  shall  not  buy,  contract  for,  sell,  store,  or  otherwise  handle  or  deal 
in  any  farm  equipment  for  the  purpose  of  unreasonably  increasing  the  price  or 
restricting  the  supply  of  any  such  commodity,  or  of  monopolizing,  or  attempting 
to  monopolize,  either  locally  or  generally,  any  such  commodity. 

This  regulation  gave  indirect  supervision  over  the  prices  of  all 
farm  implements. 

Agricultural  agents  were  asked  to  report  to  Washington  the  prices 
that  the  increased  costs  of  freight,  labor,  and  raw  materials  had 
to  June,  1918,  and  price  lists  were  secured  from  the  licensees  in  order 
to  check  prices  in  each  branch  of  the  industry.3  The  hoarding  of 

1  The  difficulties  of  the  situation  had  early  reached  Congress,   and  on  May  13,   1918, 
under   Senate  Resolution   No.   223,   the  Federal   Trade   Commission   was   directed   to  in- 
vf-stigate  and  report  to  the   Senate  the  cause  or  causes  of  the  high  prices  of  agricul- 
tural implements  and  machinery.     The  investigation  at  the  present  date,  June  15,  1919, 
has  not  been  completed. 

2  Retailers  whose  gross  annual  sales  were  less  than  $100,000  were  exempted  from  the 
license  requirements. 

s  It  is  of  interest  to  note  that  while  the  Food  Administration  paid  no  attention  to 
replacement  value  in  determining  selling  price,  the  Department  of  Agriculture  left  the 
question  as  to  whether  replacement  value  would  he  considered  in  figuring  costs  entirely 
to  the  individual  licensee.  The  attitude  of  the  Department  of  Agriculture  in  this 
connection  is  well  presented  in  the  following  public  statement  made  in  the  midsummer 
of  1918  : 

"  The  prices  of  farm  equipment  are  more  or  less  seasonal,  but  if  the  price  should 
jise  or  fall  during  the  season,  then,  to  be  consistent,  a  person  who  wishes  to  sell  on 
the  basis  of  replacement  values  would  be  obliged  to  sell  at  a  loss  if  the  price  fell. 
Equipment  carried  over  from  one  season  to  another — that  is,  the  residual  from  a  pre- 
vious season's  reasonable  supply — should  be  considered  in  the  same  manner.  There- 
fore, if  persons  have  sold  at  replacement  values,  they  must  continue  to  do  so  when  a 
drop  in  prices  comes,  and  carry  the  same  amount  of  stock  as  in  the  beginning  through- 
out the  period  of  the  high  prices  in  order  not  to  profiteer. 

"  In  short,  it  will  not  be  considered  profiteering  if  farm  equipment  is  sold  on  the 
basis  of  replacement  prices^  provided  the  goods  sold  are  replaced  at  once  at  replace- 
ment prices  and  this  practice  is  continued  during  the  period  of  high  prices  caused  by 
the  war." 


378 


HISTORY   OF   PRICES   DURING   THE   WAR. 


VDGHTEQ  iNorx  Nu«ci»cr  PWCQ  or 

— -FERTILIZERS 
-&LL  .COMMODITIES" 


agricultural  implements  was  declared  illegal,  and  "  the  holding,  con- 
tracting, or  arranging  for  a  quantity  of  equipment  in  excess  of  rea- 
sonable requirements  "  was  con- 
sidered evidence  of  hoarding. 

In  the  autumn  of  1918  the 
farm-implement  manufacturers 
wished  to  increase  their  prices. 
It  was  the  contention  of  the 
manufacturers  that  the  in- 
creased cost  of  freight,  labor, 
and  raw  materials  had  increased 
their  costs  about  10  per  cent, 
and  that  they  should  be  allowed 
to  increase  their  selling  prices 
to  a  commensurate  degree.1 

The  Federal  Trade  Commis- 
sion, which  was  making  a  cost 
investigation  in  the  implement 
industry,  had  not  yet  secured 
sufficient  data  to  justify  any 
action  on  the  part  of  the  De- 
partment of  Agriculture,  and 
it  was  not  thought  advisable 
to  make  any  definite  decision. 
The  profits  of  the  preceding- 
year,  however,  had,  in  the  opin- 
ion of  the  Department  of  Agri- 
culture, been  "  well  above  the 
prewar  average,"2  and  this,  taken  in  consideration  with  the  general 
conditions  of  the  industry,  led  the  authorities  to  believe  that  a  rise 

1  In   a  letter  of  Oct.   22,   1919,   from  the  farm-implements  committee   representing  the 
industry  to  the  Department  of  Agriculture,  in  which  permission  for  the  increase  in  price 
was  asked,  'the  following  facts  were  emphasized  : 

1.  The  advance  in  freight  rates  over  the  preceding  spring  cost  the  industry  approxi- 
mately $7,500,000. 

2.  Labor  costs  had  increased  from  20  to   40  per  cent,  or  approximately   $15,000,000, 
thereby  making  a  total  increased  cost  of  $22,500,000,   "  which  would  be  7i  per  cent  on 
$300,000,000  sales  volume." 

3.  Malleables  and  other  items  entering  into  the  construction  of  farm  implements  had 
also  gone  up  in  price. 

The  committee  asked  the  Department  of  Agriculture  to  rule  "  on  the  question  of  the 
average  amount  of  advance  in  selling  price "  that  would  be  sanctioned,  and  added 
that  the  general  view  of  the  industry  appeared  to  be  that  conditions  justified  an  average 
advance  of  approximately  10  per  cent. 

2  The  Department  of  Agriculture  apparently  doubted  several  of  the  contentions  of  the 
industry   as  is   evidenced   in   the   following   extract   from   a  letter  on   Oct.    28,   1918,   in 
reply  to  the  request  that  they  be  allowed  to  increase  prices  : 

"  It  would  be  of  great  assistance  if  you  could  give  the  information  upon  which  the 
extra  cost  of  the  industry  of  seven  and  a  half  million  dollars  as  based  for  freight  ad- 
vances, so  we  could  have  some  detatils  for  this  huge  figure.  The  same  applies  to  labor 
advances.  The  figures  20  to  40  per  cent  seem  to  me  too  high,  as  I  have  seen  no  figures 
to  justify  such  a  rise  all  round." 


Weighted  index  numbers  of  prices. — Fer- 
tilizers and  "  All  commodities." — By 
months,  January,  1913,  to  December,  1918. 
(Average  quoted  prices,  July,  1913,  to 
June,  1914=100.) 


GOVERNMENT    CONTROL   OVER  PRICES.  379 

of  prices  would  be  unjustified.     And  the  price  lists  of  early  1918 
were  continued  through  1918  without  any  change. 

(2)   FERTILIZERS. 

No  attempt  was  made  by  the  Department  of  Agriculture  to  exer- 
cise direct  control  over  the  prices  of  fertilizers,  although  the  im- 
porters and  manufacturers  and  distributors  had  been  licensed  under 
the  presidential  proclamation  of  February  25,  1918.  The  activities 
of  the  department,  indeed,  consisted  mainly  in  helping  the  industry 
to  secure  cars  and  fuel  during  periods  of  stringency. 

The  price  of  fertilizers  was,  however,  probably  affected  by  the 
work  of  the  department  in  distributing  nitrate  of  soda  to  farmers 
throughout  the  country.  In  the  year  1918,  75,000  short  tons  were 
sold  at  a  price  of  $75.50  per  ton.  The  1919  demands  approximated 
150,000  tons,  the  selling  price  of  which  averaged  $81. 1 

1  The  present  tendency  of  fertilizer  prices  is  shown  in  reports  received  by  the  De- 
partment of  Agriculture  which  indicate  that  the  fall  of  1919  will  witness  a  drop  of  about 
3d  per  cent  in  the  price  of  mixed  fertilizers  in  various  southern  States. 


ii.  THE  BASIS  FOR  DETERMINING  A  FIXED  PRICE. 

The  student  who  turns  through  the  several  chapters  that  have 
gone  before,  and  seeks  there  a  sharp  analysis  of  the  policies  that  lay 
at  the  bottom  of  each  control,  will  be  disappointed.  The  Con- 
gress or  the  President  formulated  no  general  rule  of  price  fixing, 
upon  which  each  control  agency  might  put  its  finger,  beyond  their 
hope  that  prices  would  remain  near  enough  the  cost  of  production 
to  yield  only  "  reasonable  profits."  The  various  war-time  agencies, 
therefore,  each  went  its  own  way  always  with  the  approval  of  the 
President,  and  each  set  up  its  peculiar  system  of  control. 

The  price-control  boards  generally  were  given  cost  data  through 
the  Federal  Trade  Commission,  and  this  fact  did  give  them  a  some- 
what common  approach  in  their  bases  for  determining  upon  a  fixed 
price.  But  not  during  the  whole  war  were  the  boards  in  working 
agreement  upon  what  should  constitute  the  costs  allowable  for  pro- 
duction, or  the  "  reasonable  profit ?'  allowable  above  those  costs  once 
they  had  been  determined.  They  were  at  equal  loss  in  the  beginning, 
once  each  had  satisfied  its  own  mind  what  to  allow  as  a  "  reasonable 
profit,"  whether  to  grant  that  "  reasonable  profit "  to  each  producer 
above  his  own  individual  cost  of  production,  or  make  it  applicable 
without  scruples  to  low-cost  and  high-cost  producers  alike.  The 
Food  Administration  generally  chose  the  more  flexible  control,  made 
possible  by  wide  uses  of  profit  margins  for  application  by  each 
individual.  The  price-fixing  boards,  strictly  speaking,  however, 
came  to  adopt  a  single  rather  than  a  variable  price,  fixed  somewhere 
above  the  "  bulk  line  "  of  production. 

(i)   THE  OBJECTS  OF  THE  PRICE  FIXERS. 

It  is  important  to  bear  in  mind  at  the  outset  that  the  immediate 
objects  at  stake  with  the  various  control  boards  were  not  'always 
identical.  The  War  Industries  Board  and  price-fixing  committee, 
for  instance,  gave  emphasis  to  the  stabilization  of  prices  pertaining 
especially  to  Government  purchases,  while  the  Food  Administra- 
tion and  Fuel  Administration  emphasized  the  protection  of  the  pub- 
lic. The  main  object  of  all  price-control  boards  at  Washington, 
however,  was  to  stimulate  and  maintain  a  maximum  of  production 
and  it  was  to  this  problem  they  all  gave  attention  in  some  manner. 

The  Food  Administration  and  the  Fuel  Administration  did  not, 
of  course,  await  the  announced  intention  of  the  Government  to  pur- 
chase a  particular  commodity  before  adopting  some  form  of  con- 
trol if  public  necessity  required.  There  were  in  point  of  fact  close 
380 


GO  VEHEMENT    CONTROL    OVER   PRICES.  381 

and  direct  relations  between  Government  orders  and  the  regulations 
of  foods  and  fuels,  through  food  supplies  going  to  the  Army  and 
Navy  and  the  supply  of  fuel  for  war  manufactures.  But  the  War 
Industries  Board,  and  later  the  price-fixing  committee,  took  as  their 
main  concern  the  prices  of  commodities  which  Avere  needed  in  great 
quantity  by  the  Government.  The  origin  of  every  regulation  by  the 
price-fixing  committee  lay  in  the  circumstance  that  the  Government 
purchases  were  on  a  great  scale  and  threatened  to  disturb  market 
prices.1  The  main  object  of  the  price-fixing  committee  was  the 
stimulation  of  production,  and  it  was  that  factor  rather  than  the  de- 
sire for  a  low  price  alone  which  influenced  them  in  determining  upon 
various  fixed  prices.  They  did  not,  it  should  be  emphasized,  work 
always  upon  the  theory  that  the  highest  price  would  assure  an  ulti- 
mate maximum  production  when  wage  or  other  problems  compli- 
cated particular  situations.2  They  strove  to  fix  their  maximum 
prices  at  points  high  enough  to  encourage  production  adequate  to 
meet  the  war  program,  but  no  higher. 

(2)   THE  METHODS  OF  CONTROL. 

So  many  kinds  of  control  affecting  prices  were  exercised  during 
the  war  that  an  arbitrary  line  can  scarcely  be  drawn  separating 
price  from  other  controls.  The  method  of  this  inquiry  has  been  to 
count  as  affecting  prices  those  controls  exercised  over  requirements, 
clearances,  allocations,  conservation,  and  priorities,  but  to  study 
them  only  in  a  general  way.  The  main  business  of  this  study  after 
all  has  been  an  analysis  of  the  controls  dealing  directly  and  strictly 
with  prices.  These  controls  include  the  setting  of  minimum  and 
maximum  prices  known  commonly  as  "  fixed  "  prices,  the  setting  of 
maximum  margins  of  profit,  or  the  fixing  of  special  prices  for  Gov- 
ernment purchase  solely.  The  latter  prices  pertaining  to  Govern- 
ment purchases  might  in  another  sense  be  classed  under  options  or 
outright  purchases,  and  involve  a  study  of  the  commandeering  and 
requisitioning  orders.  These  kinds  of  price  control  were  exercised 
by  different  boards  in  diverse  ways,  determined  usually  by  the  powers 
at  their  command. 

The  conspicuous  instance  of  a  minimum  price  set  during  the  war 
was  that  made  by  the  Congress  on  August  10,  1917,  when  it  fixed  a 
minimum  price  of  $2  per  bushel  for  wheat.  The  whole  body  of 
regulations  administered  by  various  boards,  with  but  three  excep- 
tions, were  designed  to  hold  prices  down  and  might  be  called  either 
"  maximum  prices  "  or  "  maximum  margins  of  profit."  There  fol- 
lows a  word  in  explanation  of  the  method  by  which  each  board 
chose  one  or  the  other  of  these  kinds  of  control. 

1  Price-fixing  as  Seen   by  a   Trice-fixer,   Ly    F.    W.   Taussig,   formerly   of  the  price-fixing 
committee. 

2  Lieut.    Col.    Robert    II.    Montgomery,    formerly   of   the   price-fixing    committee. 


382  HISTORY  OF  PRICES  DURING  THE  WAR. 

The  War  Industries  Board,  and  the  price-fixing  committee  after 
March  14,  1918,  concerned  themselves  solely  with  setting  pegs  beyond 
which  prices  might  not  rise  but  below  which  the  law  of  supply  and 
demand  theoretically  was  given  free  play.  But  in  fact  the  paucity 
of  real  power  given  to  the  board  and  the  committee  made  them  bar- 
gain virtually  with  the  trade  until  an  agreement  was  reached.  Their 
control  might  more  properly,  therefore,  be  called  "  agreed-upon 
maximum  prices  "  between  the  Government  and  the  industry. 

The  Food  Administration,  while  sometimes  virtually  fixing  prices 
by  effective  roundabout  methods,  did  not  in  the  main  utilize  the 
fixed-price  method  of  control  exercised  by  other  boards  and  seemed 
almost  to  boast  that  it  had  no  legal  power  to  fix  prices.  Their  atti- 
tude was  the  more  significant,  furthermore,  because  apparently  it 
represented  a  real  conversion  to  some  definite  policy  of  control.  The 
point  of  departure  was,  it  would  seem,  one  of  policy  rather  than 
power,  since  the  Food  Administration  was  granted  more  liberal 
powers  to  control  prices  by  Congress  than  were  the  War  Industries 
Board  or  the  price-fixing  committee.  The  Food  Administration 
control  was  more  nebulous  than  any  other  control  at  Washington, 
and  from  many  angles  more  flexible  as  applied  to  widely  used 
staples.  It  consisted  in  the  setting  of  maximum  margins  of  profit, 
determined  generally  upon  the  reasonable  prewar  profit  announced 
in  circular  form,  with  the  intention  that  each  individual  affected 
should  apply  the  approved  margins  in  his  own  business. 

The  Fuel  Administration,  with  a  firmer  legal  authority  to  do  so 
than  any  other  price-control  organ  at  Washington,  fixed  prices  in  a 
stricter  sense  than  any  other  board.  The  War  Trade  Board  exer- 
cised its  control  over  prices  by  its  power  to  stipulate  the  conditions 
upon  which  import  and  export  licenses  would  be  granted.  The 
Army  and  Navy,  interested  only  in  their  own  purchases,  worked  out 
schemes  whereby  Government  prices  were  determined  and  enforced 
by  their  power  of  commandeering  or  requisitioning. 

(3)  THE  DATA  USED  IN  FIXING  A  PRICE. 

The  most  useful  data,  which  the  war  boards  sought  to  have  on 
hand  before  beginning  the  determination  of  a  fixed  price,  were  sched- 
ules of  the  costs  of  production.  The  Federal  Trade  Commission, 
with  its  hundreds  of  accountants  busy  over  the  country,  supplied 
cost  figures  especially  for  the  War  Industries  Board,  the  price-fixing 
committee,  and  the  Fuel  Administration.1  The  various  interpreta- 

1  The  Federal  Trade  Commission  during  the  war  made  confidential  cost  studies  upon 
the  following :  Bituminous  coal ;  anthracite ;  coal,  jobbing :  coal,  retailing ;  coal, 
docking ;  crude  petroleum  ;  fuel  oil ;  kerosene  ;  gasoline  ;  lubricating  oil ;  aviation  gaso- 
line ;  castor  oil ;  iron  ore  ;  coke ;  charcoal ;  pig  iron  ;  ingots  ;  blooms  ;  slabs  ;  billets ; 
rails  ;  shapes  ;  plates  ;  bars  ;  sheet  bars  ;  sheets  ;  rods  ;  wire  ;  tin  plate ;  wire  rope ; 
steel  rounds ;  forged  billets ;  nickel  and  carbon  steel  bars ;  steel  slugs ;  Davis  wheels ; 
cast-iron  pipe;  high-speed  tool  steel;  steel  castings;  malleable-iron  castings;  fuses 


GOVERNMENT    CONTROL   OVER   PRICES.  383 

tions  put  upon  different  cost  data  in  the  determination  of  the  point 
above  which  to  allow  a  "  reasonable  profit"  are  considered  later. 

In  addition  to  material  relating  to  costs  of  production  there  was 
made  available  to  various  control  agencies  at  Washington  through 
the  price  section  of  the  War  Industries  Board  a  comprehensive  set 
of  quotations  of  commodities  at  wholesale.  These  prices  were  espe- 
cially useful  where  cost  data  were  not  available  and  where  it  was 
desired  to  know  how  far  above  costs  speculation  in  the  market  had 
carried  prices.  It  was  not  possible,  except  where  confidential  re- 
ports were  available  or  volunteered,  to  report  contract  prices, 
although  in  the  case  of  several  of  the  most  important  commodities 
dealt  with  the  bulk  of  sales  was  made  under  contract.  For  a  great 
many  of  the  transactions  current  quotations  were  of  little  significance 
because  of  outstanding  contracts.  Old  contract  prices  were  of  par- 
ticular importance  in  the  consideration  of  control  over  crude  iron, 
steel,  copper,  and  sulphuric  acid. 

(4)   THE  PROBLEM   OF  THE  LOW-COST  AND   THE   HIGH-COST 

PRODUCERS. 

It  was  obvious  from  the  outset  that  producers  would  not  strive  to 
turn  out  their  maximum  of  production  unless  assured  of  a  price  high 
enough  above  their  costs  of  production  to  yield  them  a  reasonable 
profit.  But  as  soon  as  an  investigation  into  the  cost  of  producing 
any  commodity  began,  wide  differences  appeared  between  the  costs 
incurred  by  the  several  producers.  That  problem  remained  through- 
out the  war  one  of  the  most  intricate  of  those  confronting  price-fixing 
.boards. 

and  torpedoes  ;  locomotives ;  locomotive  cranes ;  farm  machinery ;  farm  machinery,  re- 
tailing;  sisal  twine;  automatic  sprinklers;  automatic  sprinklers,  installing;  clinical 
thermometers  ;  copper  ;  nickel ;  lead  ;  manganese  ore  ;  aluminum  ore  ;  aluminum  ingots  ; 
aluminum  products  ;  zinc ;  zinc  sheets ;  zinc  plates  ;  zinc  concentrates,  reducing ;  monel 
metal ;  quicksilver  ;  brass  and  copper  sheets  ;  brass  seamless  tubes  ;  brass  rods  ;  insulated 
copper  wire;  sand  and  gravel;  crushed  stone:  riprap  stono  ;  asbestos  fiber;  asbestos  prod- 
ucts ;  cement ;  common  brick  ;  sand,  lime,  brick  ;  fire  brick  ;  hollow  building  tilo  ;  gypsum 
wall  board  ;  gypsum  plaster  board  ;  fiber  wall  board  ;  yellow-pine  timbers  ;  yellow-pine  lum- 
ber ;  spruce  lumber ;  Douglas  fir ;  hemlock  lumber ;  mahogany  lumber ;  logs ;  logging ; 
locust  treenails ;  windows  and  doors :  birch  logging ;  rosin ;  lumber,  retailing ;  boxes 
and  barrels;  wood  pulp;  sulphite  pulp;  newsprint  paper;  book  paper;  envelopes; 
stationery;  chip  board;  container  board;  acetone;  acetate  of  lime;  alcohol;  sulphur; 
sulphuric  acid  ;  caustic  soda  ;  chloride  of  lime ;  soda  ash  ;  bicarbonate  of  soda  ;  wash- 
ing soda  ;  liquid  chlorine  ;  calcium  chloride  ;  hydrochloric  acid  ;  glycerin  ;  pintsch  gas  ; 
cottonseed  crushing ;  cotton  ginning ;  cotton  compressing ;  cotton  linters ;  cotton 
yarn  ;  cotton  duck  ;  shelter  tent  cluck  ;  tape  and  webbing ;  sheetings  ;  denims  ;  gauze  ; 
towels;  wool,  wholesaling;  woolens,  wholesaling;  rags,  wholesaling;  kersey  lined 
breeches  ;  sheepskins,  importing  ;  hides,  wholesaling  ;  sole  leather  ;  black  harness  leather ; 
calf  upper  leather ;  kip  upper  leather  ;  side  upper  leather  ;  boots  and  shoes  ;  boots  and 
shoes,  retailing  ;  slaughtering ;  meat  and  by-products  ;  lard  rendering ;  lard  substitutes  ; 
milk;  grain,  wholesaling ;  flour;  flour,  jobbing;  bread;  canned  vegetables;  canned 
fruits;  canned  meat;  canned  fish;  canned  milk;  canned  condiments;  dried  fruits; 
smoking  tobacco  ;  chewing  tobacco ;  cigarettes  ;  oil  tanker  transportation  ;  towing ;  ship- 
building, accounting, 


384 


HISTORY   OF   PRICES   DURING   THE   WAR. 


Less  difficulty  would  have  been  encountered  in  finding  a  single  unit 
cost  of  production  for  each  commodity  controlled,  perhaps,  had  the 
whole  of  each  commodity  been  produced  by  one  company.  It  was 
relatively  simple  to  represent  the  cost  of  producing  a  pound  of 
nickel  or  of  aluminum  in  this  country  because  the  output  of  each  was 
virtually  controlled  by  a  single  concern.  But  the  cost  of  producing 
a  ton  of  pig  iron  varied  from  $18.14  to  $45.72  in  September,  1918, 
according  to  figures  collected  by  the  Federal  Trade  Commission. 
The  cost  of  producing  a  ton  of  beehive  coke  varied,  in  like  manner 
with  different  producers,  from  $2.93  to  $11.45.  The  cost  of  produc- 
ing a  ton  of  anthracite  coal  within  the  Pennsylvania  district  varied 
from  $2.64  per  ton  to  $7.06.  An  excellent  example  in  the  diversity 
of  unit  costs  is  brought  out  by  the  Federal  Trade  Commission  report 
upon  the  costs  of  producing  rosin,  which  show  a  variation  in  the  per 
cent  of  margin  on  investment  running  for  different  companies  from 
10.7  per  cent  to  275.1  per  cent.1  The  price-fixing  committee  gave 
considerable  thought  to  this  problem,  and  endeavored  carefully  to 
determine  whether  it  would  be  better  to  fix  upon  a  set  margin  of 
profit  above  cost  and  thus  fix  a  different  price  for  each  producer,  or 
select  a  point  somewhere  between  and  make  that  single  fixed  price 
applicable  alike  to  the  low-cost  and  high-cost  producer. 

There  did  not  appear  during  the  whole  war  a  more  intelligent  in- 
quiry into  the  problem  provoked  by  a  difference  in  cost  between  pro- 
ducers than  that  initiated  by  Mr.  Kobert  S.  Brookings  as  chairman 
of  the  price-fixing  committee.  Mr.  Brookings,  early  in  September 

1  Federal  Trade  Commission  figures,  covering  first  10  or  11  months  of  1918: 

ROSIN 
[Production  margin,  based  on  average  sales  value.]  <* 


Company. 

Barrels 
produced, 
280.a 

Sales 
value 
produc- 
tion (per 
barrel). 

Cost  of 
produc- 
tion and 
market- 
ing ex- 
pense(per 
barrel). 

Margin 
(per  bar- 
rel). 

Invest- 
ment 
(per 
barrel). 

Per  cent 
of  mar- 
gin on 

invest- 
ment. 

No  1  b 

5  991 

§10  69 

£10  087 

<RQ  6Q3 

<$3  445 

17  2 

No  2 

3  764 

9  17 

8  084 

1  086 

d  10  723 

10  7 

No  3 

9  080 

9  31 

7  269 

2  041 

3  090 

50  5 

No  4  & 

12  743 

10  83 

8  549 

2  281 

7  775 

29  5 

No.  5    

6,787 

8.67 

6.297 

2.373 

d  12  870 

18  1 

No  6 

4  971 

9  86 

6  240 

3  620 

3  120 

115  3 

No.  7    

5.025 

10.23 

6.181 

4.049 

d  12.894 

31  4 

No  8  & 

9  636 

10  91 

5  727 

5  183 

2  198 

235  8 

No  9  c        ...          

6,234 

10.12 

4.538 

5.582 

4.812 

116.5 

No.  10  *  

17,387 

11.31 

5.183 

6.127 

4.125 

148.4 

No  11  b                   

16,298 

11;  26 

4.910 

6.350 

2.732 

232.0 

No.  12  b  

10,  475 

10.62 

3.922 

6.698 

2.434 

275.1 

A  verage      

10.25 

6.415 

3.833 

5.926 

85.8 

a  Companies  range  in  order  of  margin  per  case,  fro:n  low  to  high. 

&  Eleven-month  periods. 

c  Ten-month  periods. 

(i  Heavy  investment  due  to  output  being  less  than  the  still's  capacity. 


GOVERNMENT   CONTROL   OVER  PRICES.  385 

of  1918,  asked  various  leading  economists  familiar  with  the  price 
problems  at  Washington,  and  the  members  of  the  price-fixing  com- 
mittee, to  present  memoranda  upon  the  respective  advantages  of 
fixing  a  variable  and  a  single  price.  These  opinions,  made  by  men 
peculiarly  qualified  by  war-time  experience  to  judge  the  practical  as 
well  as  the  theoretical  aspects,  are  worthy  of  analysis.  There  follow 
the  memoranda  given  by  Dr.  F.  W.  Taussig,  member  of  the  price- 
fixing  committee  and  chairman  of  the  United  States  Tariff  Commis- 
sion; Lieut.  Col.  Robert  H.  Montgomery,  representative  of  the  War 
Department  upon  the  price-fixing  committee ;  Mr.  Wesley  C.  Mitchell, 
chief  of  the  price  section  of  the  War  Industries  Board;  Mr.  William 
B.  Colver,  member  of  the  price-fixing  committee  and  chairman  of 
the  Federal  Trade  Commission ;  Mr.  W.  F.  Gephart,  of  the  United 
States  Food  Administration ;  Mr.  H.  M.  Channing,  chief  of  the  legal 
section  of  the  War  Industries  Board;  and,  finally,  Mr.  Robert  S. 
Brookings,  chairman  of  the  price-fixing  committee. 

1.  Dr.  F.  W.  Taussig,  chairman  of  the  United  States  Tariff  Com- 
mission and  member  of  the  price-fixing  committee,  wrote  the  follow- 
ing memorandum  on  the  question  of  "  Uniform  or  varying  prices  " : 

(1)  If  differences  in  cost  of  production  between  different  producers  were — 
(a)   Clearly    ascertainable. 

(ft)  Due  solely  to  differences  in  the  natural  resources  utilized  by  them,  it 
would  not  be  impracticable  to  purchase  from  them  at  prices  based  on  their 
differing  costs. 

As  a  matter  of  fact,  neither  of  these  conditions  is  ever  present.  In  the 
first  place,  costs  are  not  clearly  ascertainable.  They  vary  from  month  to 
month,  from  year  to  year.  We  get  figures  from  cost  accountants  which  are 
worked  out  to  the  last  cent,  but  which,  as  a  matter  of  fact,  contain  arbitrary 
and  debatable  elements.  Any  endeavor  to  pay  to  each  producer  according  to 
his  costs  would  lead  to  perpetual  wrangling,  perpetual  requests  for  changes 
and  modifications.  In  the  second  place,  differences  in  cost  are  by  no  means  due 
solely  to  differences  in  natural  resources.  They  arise  very  largely  from  differ- 
ences in  skill,  energy,  efficiency.  To  pay  a  low  price  to  a  producer  who  has 
brought  down  his  costs  through  skill  and  ability  is  to  penalize  the  most  effective 
form  of  human  effort. 

(2)  Sale  at  varying  prices  is  in  any  case  not  practicable.     If  the  Govern- 
ment fixes  a  price,  it  must  be  a  price  uniform  for  all  producers.     Were  this 
not  the  case,  there  would  be  constant  squabbling  and  intriguing  for  favored 
position. 

(3)  The  main  problem  is  that  of  purchase,  and   I  am  unable  to  see  the 
practicability,  as  conditions  of  production  stand  to-day,  of  carrying  out  a  policy 
of  purchase  at  varying  prices.    The  only  possible  way  of  carrying  it  out  would 
be  for  the  Government  to  take  over  all  the  establishments  and   try  to   run 
them.    Quite  apart  from  the  constitutional  questions  involved  (as  regards  the 
fair  price  which  the  Government  must  pay  for  each  plant)  the  actual  adminis- 
tration and  running  of  an  enormous  variety  of  plants  would  be  a  hopeless  task. 

(4)  The  only  feasible  plan  in  price  fixing  is  that  of  establishing  a  uniform 
price,  which  should  ordinarily  be  paid  for  the  whole  of  the  output. 

The  uniform  price  which  the  Government  thus  must  fix  is  not  necessarily  the 
cost  of  production  price.     It  need  not  be  either  an  average  cost  of  production 
125547°— 20 25 


386  HISTORY   OF   PRICES    DURING   THE    WAR. 

price  or  a  marginal  or  "  bulk  line  "  cost.  The  Government  might  be  expected 
under  ordinary  conditions  to  pay  the  market  price  that  would  obtain  in  the 
absence  of  regulation,  irrespective  of  cost.  Under  conditions  of  war  stress  and 
war  exigency,  however,  the  Government  must  pay  for  an  essential  commodity 
that  price  which  will  maintain  and,  if  possible,  stimulate  the  volume  of  pro- 
duction. Such  a  stimulating  price  is  not  far  from  the  marginal  or  "bulk 
line"  cost. 

There  will  always  be  sporadic  producers  having  very  high  costs,  higher  than 
the  "  bulk  line,"  who  may  be  disregarded.  It  is  conceivable  that  in  extreme 
need  for  a  particular  commodity  the  Government  will  make  some  special  bar- 
gain with  the  small  number  of  high-cost  producers.  But  such  transactions  are 
extremely  dubious  and  are  to  be  avoided  except  in  the  extremest  urgency.  As 
regards  them,  it  must  be  made  out  that  the  very  high  cost  of  the  producers  is 
not  due  to  slackness  or  inefficiency  on  their  part  but  to  poor  natural  resources, 
and  that  the  payment  is  indispensable  for  the  maintenance  of  a  supply  abso- 
lutely needed. 

2.  Lieut.  Col.  B.  H.  Montgomery,  representative  of  the  War  De- 
partment on  the  price-fixing  committee,  submitted  the  following 
memorandum  on  the  "  Fallacy  of  attempting  to  pay  a  different  price 
for  the  same  thing  as  applied  to  a  basic  commodity  and  an  entire 
industry  " : 

(1)  I  strongly  object  to  any  arrangement  Avlrich  will  result  in  paying  ono 
producer  of  a  standard  article  or  commodity  a  higher  price  than  is  paid  to 
another  producer  of  the  same  thing,  for  the  following  reasons : 

Any  plan  which  purports  to  limit  the  profit  of  each  producer — 

(a)  Ignores  the  sound,  economic,  differential  to  which  the  low-cost  efficient 
producer  is  entitled ; 

(?))  It  is  in  effect  a  return  to,  rather  than  a  departure  from,  the  cost-plus 
system.  The  War  Department's  present  policy  in  this  respect  is  to  avoid  cost- 
plus  contracts  whenever  possible; 

(c)  Penalizes  the  low-cost  producer  by  placing  him  on  an  equality   (as  to 
profits)   with  the  high-cost  producer.     Such  a  penalty  is  in  direct  violation  of 
existing  intelligent  business  methods; 

(d)  Places   a   premium   on  the  high-cost   producer,   who    is   the   one   to   be 
penalized,  and  actually  encourages  a  continuance  of  inefficient,   extravagant, 
wasteful  management ; 

(e)  Purportedly  gives  the  Government  an  opportunity  to  buy  at  a  low  price 
from  the  low-cost  producer,   without  any   guaranty,  however,   that  the  low- 
cost  producers  will  continue  to  be  low  cost.    With  a  penalty  on  low  cost  and 
a  premium  on  high  cost,  is  it  not  reasonable  to  predict  that  the  low-cost  man 
will  inevitably  increase  his  costs — fraudently  or  because  he  makes  as  much 
money  on  high  costs  as  on  low  costs,  and  can  pay  as  much  as  he  likes  for  sup- 
plies, labor,  etc.? 

(/.)  Can  not  be  effectively  administered,  because  it  is  expected  that  the 
machinery  of  control  will  include  a  system  of  reports  and  inspection  emanat- 
ing from  hundreds  of  producers,  who  have  every  interest  to  overstate  their 
costs.  The  available  supply  of  skilled  accountants  in  this  country  is  exhausted. 
The  present  demand  from  legitimate  sources  greatly  exceeds  the  supply.  My 
familiarity  with  this  matter  leads  me  to  object  to  setting  up  a  system  of  control 
which  is  not  operatively  possible; 

(#)  Presupposes  that  fair  maximum  prices  can  not  be  fixed.  This  is  a 
familiar  argument  and  is  of  academic  interest  only  and  can  not  control  our 


GOVERNMENT    CONTROL   OVER  PRICES,  387 

action,  because  every  business  man  thin-ks  that  his  problems  are  more  complex 
than  those  obtaining  to  other  businesses.  As  they  can  not  all  be  right,  the  argu- 
ment falls  through  of  its  own  weight. 

(2)  I  am  strongly  in  favor  of  limiting  the  profits  of  all  contractors  who  sell 
to  the  Government  to  a  reasonable  return  on  capital  invested.     Over  a  year 
ago  the  war  committee  of  the  American  Institute  of  Accountants,  of  which  I 
am  a  member,  unanimously  adopted  a  recommendation  to  this  effect,  but  we 
could  not  secure  its  adoption.     We  are  now  forced  to  fix  a  price  which  will 
apply  to  the  Government  and  public  alike.    When  dealing  with  an  entire  indus- 
try the  elements  underlying  public  price  fixing  are  not  comparable  with  the 
ability  of  the  Government  to  supervise  individual  contractors.     I   think   the 
individual  contractor  can  be  regulated,  although  we  have  a  big  uncompleted 
job  on  our  hands  in  this  respect. 

I  do  not  think  we  can  regulate  the  costs  and  methods  of  100  per  cent  of  any 
industry.  I  do  not  think  that  we  can  fix  fair  maximum  prices  on  representative 
grades,  etc.,  and  regulate  such  prices. 

The  differences  between  regulating  costs  and  processes  (which  are  secret) 
and  regulating  prices  (which  are  public)  are,  in  my  opinion,  vital  and  con- 
trolling. 

(3)  As  the  War  Department  representative  on  the  price-fixing  committee,  I 
expect  to  maintain  the  position  that  a  policy  of  fixed  profit  per  unit,  without 
limitation  on  costs  and  extending  to  an  entire  industry,  is  unwise  and  con- 
trary to  the  best  interests  of  the  Government  and  the  industry  affected  alike. 
That  a  failure  to  encourage  and  reward  the  low-cost  efficient  producer  would 
be  a  step  backward  which  the  War  Department  will  not  stand  for,  because 
without  recognition  he  will  cease  to  exist. 

3.  Wesley  C.  Mitchell,  chief  of  the  price  section  of  the  War  Indus- 
tries Board,  submitted  the  following  memorandum  relative  to  "  One 
Price  for  Each  Commodity  versus  a  Graded  Scale  of  Prices/' 

DIVERSITY  OF  PRICES  PREVAILING  UNDER  NORMAL  PEACE-TIME  CONDITIONS. 

On  any  given  day  each  of  the  great  staples  is  sold  at  several  or  many  different 
prices. 

(1)  Varying  grades,  of  course,  command  different  prices. 

(2)  So,  too, .do  large  lots  and  small  lots  of  a  given  grade. 

(3)  There  are  differentials  between  different  markets. 

(4)  Original    producers,    local    buyers,    manufacturers,    commission    houses, 
wholesalers,  retail  dealers,  etc.,  in  turn  charge  higher  prices  than  they  paid. 

(5)  There  is  often  a  wide  difference  between  current  market  quotations  and 
contract  prices. 

(6)  Cash  prices  are  usually  lower  than  prices  which  involve  waiting  for 
payment. 

(7)  Even  the  same  class  of  dealers  selling  the  same  grade  of  the   same 
article  in  the  same  amounts  in  the  same  market  on  the  same  day  do  not  all 
receive  the  same  price.    This  last  proposition  is  particularly  important  during 
a  period  of  extraordinary  changes,  such  as  we  had  in  1916  and  the  first  half  of 
1917. 

These  diversities  are  standardized  rather  than  abolished  by  a  single-price 
policy. 

The  adoption  of  a  single-price  policy  does  not  mean  the  abolition  of  the 
above-listed  differences.  It  usually  means  that  all  business  men  of  a  given 
class  (for  example,  all  copper  miners  or  all  shoe  manufacturers)  receive  prices 


388  HISTORY   OF   PFJCES   DURING   THE   WAR. 

that  vary  in  standard  ways  from  a  single  base  price.  Differentials  for  grades, 
markets,  time  of  payment,  size  of  purchases,  etc.,  may  be  more  or  less  stand- 
ardized, but  they  are  not  eliminated.  Further,  the  base  prices  are  usually 
merely  maxima,  and  anyone  can  charge  less  if  he  chooses. 

Aside  from  the  fact  that  the  base  price  is  fixed  by  Government  instead  of  by 
contract,  the  chief  changes  from  peace-time  conditions  are  probably  that — 

(1)  Day  to  day  fluctuations  are  reduced,  if  not  eliminated ; 

(2)  There  is  less  difference  between  the  bargains  struck  in  a  given  market 
on  a  given  day ;  and 

(3)  Current  market  quotations  and  contract  prices  (under  new  contracts  at 
least)   keep  closer  together. 

A  graded  scale  of  prices  would  be  more  of  a  departure  from  peace-time  con- 
ditions than  a  single-price  policy.  For  it  would  mean  giving  to  different  pro- 
ducers prices  which  vary  by  margins,  not  based  on  differences  recognized  in 
ordinary  business,  but  on  some  other  ground,  particularly  differences  of  cost. 
In  ordinary  business,  the  fact  that  a  man  produces  at  higher  cost  than  another 
does  not  enable  him  to  get  a  higher  price.  The  crux  of  the  practical  problem 
is  whether  public  policy  requires  the  price-fixing  committee  to  introduce  into  the 
business  system  a  revolutionary  change  by  making  differences  of  cost  a  reason 
for  corresponding  differences  of  prices. 

Circumstances  whieli  may  justify  prices  graded  according  to  costs. — In.  some 
cases  it  may  be  necessary  to  stimulate  production  to  the  utmost  and  to  restrict 
ordinary  civilian  consumption.  The  most  effective  means  to  that  end  is  a 
single  base  price  so  high  that  all  productive  capacity  will  be  used,  and  so  high 
that  economy  must  be  practiced  in  consumption.  Of  course,  that  plan  gives 
low-cost  producers  extraordinary  profits — an  objection  that  is  only  partially 
met  by  the  excess-profits  tax,  since  this  tax  always  leaves  part  of  the  extraor~ 
dinary  gains  to  the  fortunate  enterprise. 

In  other  cases,  it  may  be  necessary  to  stimulate  production,  but  not  to  re- 
press civilian  consumption.  Indeed,  one  chief  aim  of  regulation  may  be  to 
||keepjlown  costs  to  the_£QiLSumer.  The  high  single  price  would  accomplish  the 
first  end  but  obstruct  the  second.  A  graded  scale  of  prices,  however,  might  be 
arranged  to  call  out  the  bulk  of  the  low-cost  production  at  a  moderate  rate, 
and  also  to  get  a  certain  amount  of  high-cost  production  at  a  different  figure. 
But  how  can  consumers  get  the  benefit  of  the  moderate  price,  and  at  the  same 
time  let  the  high-cost  producers  have  a  remunerative  market?  I  see  no  way 
except  to  arrange  a  Government-buying  monopoly,  that  would  take  over  the 
whole  product,  at  different  prices,  then  average  the  costs,  and  sell  at  a  figure 
which  would  just  cover  the  outlay  plus  administrative  expenses.  Such  a  course 
/»*may  be  feasible  in  the  case  of  a  few  great  staples,  like  sugar,  but  it  is  scarcely 
feasible  as  a  general  policy  applicable  to  commodities  at  large. 

Effect  of  the  two  systems  upon  efficiency. — A  graded  scale  of  prices,  if  car- 
ried  out  in  full  detail,  is  practically  a  "  cost-plus  "  system  of  Government  pur- 
chases. That  system  has  been  tried  out  and  displaced  because  it  gives  an  in- 
centive to  wasteful  and  inefficient  management. 

The  single-price  policy,  on  the  contrary,  is  like  the  ordinary  competitive-price 
system  in  stimulating  efficiency,  at  least  in  those  cases  where  the  price-fixing 
committee  is  not  compelled  to  set  their  price  very  high.  A  moderate  price  will 
often  enable  three-quarters  or  more  of  the  product  to  be  turned  out  at  profits 
ranging  from  the  liberal  to  the  moderate,  put  perhaps  10  per  cent  more  of  the 
producers  on  their  mettle  to  break  even,  and  put  the  remaining  15  per  cent  of 
least  efficient  producers  out  of  business — to  the  advantage  of  the  community. 


GOVERNMENT    CONTROL    OVER   PRICES.  389 

Conclusion. —  (1)  A  single-price  policy,  allowing  differentials  for  quality,  trans- 
portation, size  of  transaction,  terms,  credit,  and  margins  between  manufac- 
turers, wholesalers,  and  retailers  makes  less  of  a  departure  from  normal  busi- 
ness conditions  than  a  graded  scale  of  prices  based  on  differences  of  cost  would 
make. 

(2)  The  latter  policy,  however,  may  be  desirable  in  the  case  of  a  few  prime 
requisites  where  there  is  the  double  need  of  stimulating  production  to  the  ut- 
most and  keeping  down  cost  to  the  consumer.     To  achieve  both  these  results, 
however,  is  scarcely  possible  without  setting  up  a  Government  monopoly  for 
buying  the  total  output  and  distributing  it  at  a  uniform  price. 

(3)  In  the  great  majority  of  cases,  the  single-price  policy  is  to  be  preferred, 
because  of  its  simplicity — a  great  point  in  view  of  the  administrative  perplexi- 
ties which  the  price-fixing  committee  confronts. 

(4)  Finally,  the  single-price  system  is  more  favorable  to  industrial  efficiency 
than  the  graded  price  system — at  least,  when  the  price  taken  is  not  very  high  in 
the  scale  of  costs.    Excess  profits  taxes  will  turn  part  of  the  large  gains  of  low- 
cost  producers  into  the  Public  Treasury. 

Summary. —  (1)  A  single-price  policy  allowing  differentials  for  quality,  trans- 
portation, size  of  transaction,  terms  of  credit,  and  margins  between  the  manu- 
facturer, wholesaler,  and  retailer  makes  less  change  from  normal  business 
conditions  than  a  graded  scale  of  prices  based  on  differences  of  cost  would 
make. 

(2)  A   scale   of    prices    graded    according   to    costs,    however,    may    be   pre- 
fe  r.able  in  the  case  of  a  few  prime  requisites,  when  it  is  necessary  both  to 
stimulate  production  to  the  utmost  and  to  keep  down  costs  to  the  consumer. 

To  achieve  both  of  these  ends,  however,  it  seems  necessary  to  supplement 
price  fixing  by  creating  a  government  buying  monopoly  to  take  over  the  entire 
output,  average  the  costs,  and  distribute  the  goods  at  a  uniform  price. 

(3)  The   single-price  policy   requires   no   such   elaborate   machinery   and   is 
therefore  far  simpler  to  administer,  to  explain,  and  to  defend. 

(4)  Excess   profits   taxes   partially    remove   the   objection   that   the    single- 
price   policy    gives    government    favors    to    the    low-cost    producers.      On    the 
other  hand,  the  graded  scale  of  prices  carried  out  to  its  logical  conclusion 
is  practically   equivalent   to   the   "  cost-plus "    system,    which   has  been   aban- 
doned on  government  contracts  because  it  offers  an  incentive  to  wasteful  and 
inefficient  management. 

4.  Mr.  William  B.  Colver,  chairman  of  the  Federal  Trade  Com- 
mission and  member  of  the  price-fixing  committee,  wrote  the  follow- 
ing memorandum  on  the  question  of  "A  single  price  as  opposed  to  a 
pooling  with  varying  prices  " : 

I  beg  to  submit  for  your  consideration  some  observations  as  to  price  fixing 
and  the  theory  of  the  single  price  as  opposed  to  a  pooling  with  various  prices. 

It  would  seem  that  price  fixing  has  two  and  only  two  purposes — 

(1)  To  insure  adequate  production;  and 

(2)  To  guard  against  a  price  structure  which  shall  be  so.  high  as  to  be  un- 
healthy. 

In  applying  the  single-price  theory,  it  is  held  to  be  necessary,  in  order  to  in- 
sure the  required  production,  to  fix  a  price  high  enough  to  make  profitable  the 
operation  of  marginal,  high-cost  producers.  It  follows  that  in  meeting  the  first 
requirement,  namely,  the  insurance  of  adequate  production,  we  defeat  the  sec- 
ond purpose,  namely,  the  avoidance  of  an  unduly  high  price  structure. 

I  raise  the  question  now  whether  or  not,  in  the  light  of  experience,  the  single- 
price  theory,  as  put  into  practice,  has  been  successful. 


390  HISTORY   OF   PRICES    DURING   THE    WAR. 

Some  difficulties  that  have  followed  this  practice  may  be  enumerated  as 
follows : 

First.  A  maximum  price  becomes  a  minimum  price,  and  few  will  voluntarily 
sell  under  the  maximum  price  even  though  low-cost  producers  might  well 
afford  to  do  so.  Not  only  lias  this  practice  been  approved  but  it  has  been  aided 
and  abetted  by  a  declaration  that  the  Government  itself  will  not  accept  volun- 
tary offers  of  commodities  at  prices  lower  than  fixed  prices.  This  would 
seem  to  be  a  complete  inversion  of  the  second  purpose  of  price  fixing. 

Second.  The  single  price,  lest  it  shut  off  the  needed  production,  must  be 
high  enough  to  give  profit  to  the  highest  cost  producer  that  it  is  desired  to  con- 
tinue in  business. 

Third.  The  consequent  price  is  far  above  the  price  indicated  by  the  average 
cost  of  production. 

Fourth.  The  cost  of  living  and  the  cost  of  secondary  manufacture  is  made 
?  unnecessarily  high  and  the  mounting  prices  become  a  vicious  circle  constantly 
spiraling  upward.  ??  ? 

Fifth.  Such  single  price,  while  producing  excessive  profits  for  low-cost  con- 
cerns, does  not  necessarily  stimulate  production  but  actually  acts  as  a  check 
on  production.  (This  will  be  attempted  to  be  shown  in  detail  hereafter.) 
o  Sixth.  The  single  price  tends,  in  the  case  of  low-coj§£_  producers,  to  encourage 
wastefulness  and  extravagance  and  to  check  rather  than  to  stimulate  pro- 
duction. 

It  is  held  that  high  prices  stimulate  production  and  are  purged  by  the 
application  of  drastic  excess-profit  taxes.  Let  us  examine  this. 

Assuming   that   higher  prices   do   stimulate  production    (though   under   the 
jircumstances  here  under  consideration  this  does  not  seem  beyond  dispute), 
increased    production,    under    ordinary    circumstances,    invariably    makes    for    > 
lower  cost   and  hence,  under  fixed  price,  to  greater  profit.     The  higher  the 
Nprices^the  sooner  the  excess-profit  point  is  arrived  at,  and  as  production  con- 
jj  timies  the  more  rapidly  the  successive  stages  of  surtax  are  arrived  at.     The 
. /higher  the  tax  the  lower  the  net  profit  becomes,  and  the  inducement, is  not  7A 
not  to  increase  production  but  rather  to  curtail  it  in  order  to  avoid  get-  y* 
ting  into  the  class  of  maximum  tax.    To  illustrate  this  we  might  take  a  single  ..^ 
basic  commodity — for  example,  coal — and  any  rule  that  would  apply  to  con!       4 
would  apply  equally  to  iron  ore  and  lumber,  and  other  basic  commodities  and 
their  products. 

Taking  the  case  of  coal,  suppose  a  given  mine  produces  a  million  tons  of 
coal  per  year  in  normal  or  peace  times,  and  earned  an  average  of  10  cents  per 
ton  net  profit.  Its  net  profit  per  million  tons  of  coal  would  then  be  $100,000. 

Suppose  in  war  times,  under  regulation,  and  with  excess-profit  tax  operating, 
this  mine  produced  its  million  tons,  was  allowed  2£_per__cenj;  net  operating    - 
profit,  and  by  so  doing  arrived  at  30  per  cent  excess-profit  tax  rate.     It  would 
then  earn  $200.000  net  operating  profit,  pay  $60,000  excess-profit  tax,  and  keep 
$140,000  as  divisible  profit. 

Suppose  the  production  of  this  mine  were  doubled  and  the  resulting  profit 
(capital  investment  remaining  the  same)   caused  it  to  go  to  an  80  per  cent 
excess-profit  tax  rate.     It  would  earn  on  the  second  million  tons   (the  stimu- 
lated production)    a  gross  profit  of  $200.000,   on  which  its  excess-profit  tax 
would  be  $160,000,  and  the  divisible  profit    (the  only  real  profit)    remaining 
would  be  but  $40,000.     Clearly,  in  the  absence  of  any  other  consideration,  the 
mine  would  earn  $40,000,  leaving  the  second  million  tons  of  coal  in  the  ground      J 
until  the  return  of  peace,  when  it  could  be  mined  at  the  peace-time  rate  of     / 
profit  (10  cents)  with  the  resulting  divisible  profit  of  $100,000. 


GOVERNMENT  CONTROL  OVER  PRICES.  ..  391 

or  «*y  *** £%££*  *ko  up?****  W  *  tfaory* 

I  dissent  whoHy  and  entirely  from  the  theory  that  excess-profit  taxes  justify 
unreasonable  m-ice  structures  and  purge  unreasonable  profits.  Not  a  penny  of 
excess-profit  tax^has  been  or  will  be  paid  to  the  Government  that  has  not  first 
been  collected  with  many  other  pennies  irona  the  people  of  the  counjtry,  either 
as  consumers  or  as  taxpayers.  Since  the  Government  itself  is  by  far  the 
largest  of  all  buyers  at  fixed  prices,  it  seems  to  be  absurd  to  take  an  excess 
dollar  out  of  the  Treasury  in  order  to  get  34  cents  of  it  back  by  way  of 
excess-profit  taxes.  The  net  result  of  such  a  transaction  is  merely  creating 
the  necessity  of  raising  an  otherwise  unnecessary  66  cents  by  some  other 
means  of  taxation  or  by  bond  sale.  In  the  main,  it  is  not  industry  which 
ultimately  pays  excess-profit  taxes,  but  the  consumer,  and  only  a  small  part  of 
the  excess  which  the  consumer  pays  reaches  the  Treasury  in  the  form  of  taxes. 
The  whole  excess-profit  tax  theory  is  an  attempt  to  lift  oneself  by  his  boot- 
straps, and  there  is  lost  from  20  to  SO  per  cent  of  the  energy  employed  in  the 
process. 

A  referendum  taken  by  the  National  Chamber  of  Commerce  was  practically 
unanimous  in  favor  of  taking  no  excess  profi^  during  the  war.  Taking  this  as 
a  representative  judgment  of  the  business  world,  it  would  seem  that  the  per- 
plexing problem  of  dealing  with  excess  profits  would  be  solved  by  having  no 
excess  profits  with  which  to  deal. 

To  take  the  referendum  of  the  National  Chamber  of  Commerce  at  its  face 
value  and  apply  it  would  probably  draw  forth  some  hoarse  cries.  As  a  group, 
men  are  patriotic ;  as  indivJdual&JJLLfiy  will  pay  as  small  a  tax  as  can  be  calcu- 
lated and  will  secure  as  high  prices  and  as  great  profits  as  can  be  extracted. 
High  excess-profit  taxes  themselves  have  a  bad  effect  on  business  men.  They 
nourish  a  feeling  that  the  Government  is  wasteful,  and,  as  a  result,  tax  evasions 
do  not  carry  any  particular  feeling  of  guilt.  When  tax  evasion  takes  the  form 
of  padded  and  increased  costs,  of  lavish  expenditures  made  for  the  sole  purpose 
of  reducing  the  rate  of  profit,  the  result  must  be  detrimental  to  the  maximum 
production  at  maximum  efficiency.  The  business  organization  is  softened  by 
bad  practice  and  by  unbusinesslike  methods,  and  while  it  holds  to  such  un- 
healthy practices  it  can  not  maintain  the  highest  degree  of  efficiency. 

The  purchasing  power  of  our  money  and  credit  as  well  as  that  of  our  allies 
would  be  restored  by  a  lowered  price  structure;  tax  dollars  would  each  buy 
more  nearly  a  hundred  cents'  worth  of  goods;  the  Government  would  need  to 
collect  fewer  dollars  in  taxes  and  sell  fewer  bonds;  and  the  public,  relieved 
of  profiteering  (I  do  not  use  the  word  "profiteering"  invidiously,  at  this  time), 
would  be  able  to  produce  the  required  tax  money  and  bond  money  since  their 
buying  power,  which  is  not  absorbed  by  the  mere  expense  of  keeping  alive, 
would  be  left  free  in  large  proportion  to  be  dedicated  to  the  service  of  the 
Nation.  If  the  inflated  price  structure  were  brought  back  to  an  approximation 
of  normal,  and  if  100-cent  dollars  were  substituted  for  the  40-cent  dollars  we 
are  now  using,  many  of  the  problems  which  perplex  and  much  of  the  rising 
discontent  would  be  disposed  of.  The  single-price  fixed  so  high  as  to  make 
profitable  the  high-cost  marginal  producer  has,  as  I  have  said,  a  vicious  effect 
on  business  itself.  The  reflex  shows  itself  in  tax  evasions  and,  worst  of  all, 
in  inviting  and  encouraging  wasteful  and  extravagant  business  operations. 

When  a  business  reaches  the  point  that  its  excess-profit  tax  will  operate  to 
take  away  a  considerable  part  of  its  earnings,  it  inevitably  is  tempted  (and  in 
many  cases  the  temptation  has  proven  irresistible)  to  spend  extraordinary  sums 
in  unnecessary  expenditures.  These  take  the  form  of  advertising  looking  to 
the  building  up  of  present  or  future  good  will,  or  repairs  and  betterments  not 
presently  needed  or  made  with  an  eye  to  the  future  and  in  anticipation  of  a 
return  to  peace-time  basis.  Further,  expenditures  are  lavishly  made  by  big  con- 


392  HISTORY    OF   PRICES    DURING   THE   WAR. 

corns  out  of  rapidly  accumulating  surpluses  which  are  in  the  nature  of  strategic 
advances  upon  other  weaker  competitors  and  which,  upon  a  return  to  peace- 
time basis,  will  tend  to  result  in  a  permanent  elimination  of  weaker  competitors 
and  the  rapid  extension  of  monopolistic  conditions.  These  expenditures  are 
made  on  the  theory  that  out  of  every  dollar  so  spent,  the  Government  itself 
contributes  anywhere  from  20  to  80  cents  of  the  cost. 

The  whole  purpose  of  price  fixing  and  of  tax  legislation  is  not  to  raise 
revenue  but  to  win  the  war.  That  is  the  single  aim  of  all  these  activities.  Any 
device  which  interferes  with  that  aim  is  conceived  in  error. 

Having  gotten  this  rather  long  preamble  behind  us,  let  us  now  consider  what 
may  be  done  with  respect  to  iron  and  steel. 

In  the  first  place,  the  Steel  Corporation,  through  its  control  of  a  large  part  of 
the  railroad  transportation  at  the  head  of  the  Lakes,  was  able  to  levy  a  toll  on 
the  bulk  of  the  iron  ore  produced  in  the  country.  Just  as  in  the  case  of  anthra- 
cite coal,  in  which  a  plan  was  worked  out  where  the  profit  in  anthracite  coal 
lay  in  many  cases  not  in  mining  it  but  in  its  transportation  to  market,  so  in  the 
case  of  iron  ore,  the  mining  of  toe  ore  itself  was  often  relatively  unprofitable 
while  the  transportation  of  the  ore  by  rail  was  made  to  yield  enormous  profit. 
The  anthracite  railroads  owned  a  great  many  of  the  anthracite  mines;  they 
often  mined  practically  at  a  loss,  transporting  the  coal  at  an  enormous  profit, 
and  competitors  were  compelled  to  mine  at  the  lowest  possible  margin  and  all 
the  natural  profits  were  absorbed  by  the  transportation  companies  as  freight. 

The  railroads  of  the  country,  aside  from  .the  Government  itself,  are  the 
greatest  consumers  of  iron  and  steel  products.  The  Railroad  Administration 
now  has  in  its  control  the  ore-carrying  roads  of  the  Northwest.  If  the  iron  ore 
were  carried  to  market  at  a  price  which  would  represent  just  about  the  cost  of 
the  service,  the  resulting  total  railroad  revenue  for  the  whole  country  would 
show  a  very  slight  decrease,  but  if  this  loss  in  freight  revenue  and  consequent 
saving  in  cost  of  ore  at  furnace  were  carried  on  through  the  iron  and  steel  price 
structure,  the  railroads  would  undoubtedly  get  back  several  times  over,  by 
reason  of  lowered  cost  of  materials,  such  shrinkage  in  freight  earnings. 

This  would  apply  also,  perhaps,  to  a  readjustment  of  freight  rates  with 
respect  to  coke,  and  possibly  for  coal  also,  at  least  in  certain  cases,  for  example, 
such  rates  as  apply  to  Bethlehem  on  ore,  coal,  and  coke.  Bethlehem  might  be 
made  a  fairly  low-cost  production,  instead  of  which  Bethlehem  now  puts  the 
entire  steel  industry  out  of  harmony  and  is  the  chief  disturbing  factor  in  our 
problem.  Rather  than  permit  Bethlehem  to  upset  the  whole  steel  industry,  it 
might  well  be  operated  on  Government  account  and  so  be  removed  from  the 
equation. 

As  we  see  the  enormous  spreads  in  the  various  production  costs  of  pig  iron, 
end  as  we  see  these  spreads  grow  as  the  fabrication  of  the  material  is  carried 
forward,  it  seems  apparent  that  if  some  device  could  be  found  whereby  opera- 
tions could  be  started  at  one  or  more  points  from  a  level,  the  problem  would  be 
simplified. 

The  main  objection  to  a  variety  ^of  buying  prices  and  a  composite  selling 
price  is  that  it  penalizes  efficiency  and  bonuses  inefficiency.  But  the  excess 
profit  tax  does  this  very  thing,  frankly  and  unashamedly.  That  is  what  the 
excess  profit  tax,  taken  together  with  high  prices,  is — penalty  for  efficiency 
and  by  contrast  a  subsidy  for  inefficiency. 

Suppose  we  were  seeking  for  a  real  stabilization ;  let  us  take  iron  and  steel 
as  our  example.  If  at  vital  points  equitable  levels  could  be  arrived  at,  we 
could  have  a  fair  basis  from  which,  particularly  in  an  effort  to  stimulate  pro- 
duction, to  keep  prices  relatively  normal,  to  directly  reward  efficiency  and  by 
contrast  to  penalize  inefficiency. 


GOVERNMENT    CONTROL    OVER   PRICES.  393 

Suppose  in  iron  and  steel  all  the  iron  ore  were  taken  over  by  the.  Govern- 
ment at  varying  prices  to  be  determined  by  adding  to  a  reasonable  cost  of 
production  a  just  and  reasonable  profit.  The  iron  ore  from  the  various  ore- 
producing  fields  purchased  at  varying  prices  would  be  pooled  and  result  in 
a  composite  price  for  each  consuming  field,  so  that,  so  far  as  the  ore  price  is 
concerned,  all  furnaces  would  start  on  an  equality.  There  would  remain  the 
'differential  of  transportation,  and -absolute  equality  could  be  secured  by  de- 
livering ore  to  the  various  furnaces  at  a  uniform  price  which  would  include 
transportation.  In  other  words,  pool  not  only  the  ore  price  but  the  trans- 
portation charge.  Now  we  would  have  all  furnaces  in  a  given  field  starting 
on  an  equality  as  to  their  ore. 

Similarly  let  the  Government  buy  all  the  coke  at  varying  prices  and  dis- 
tribute it  at  a  composite  price  which  would  absorb  freight  differentials. 

Now  we  come  to  the  calculation  of  the  profit  per  ton.  There  should  be  an 
a^^eed  upon  per-ton  profit,  but  this  should  be  used  only  as  a  basis,  because, 
as  we  shall  see,  equity  would  require  certain  differentials  not  difficult  to 
calculate. 

First :  Equity  as  between  producers  requires  consideration  of  the  amount 
of  the  investment  and  of  its  character.  For  instance,  it  is  often  found  that 
a  low-furnace  cost  has  only  been  obtained  by  the  expense  of  a  high  investment 
per  ton  of  output,  while  frequently  a  high-furnace  cost  may  be  coupled  with 
a  low  investment.  It  is  obvious  that  the  application  of  a  uniform  unit  profit 
without  reasonable  consideration  and  scrutiny  of  investment  will  be  inequitable. 

This  calculation  of  unit  profit  based  on  investment  would  also  run  with 
respect  to  the  ore  mines  and  coke  ovens,  and  the  same  theory  might  well  be 
carried  on  through  the  more  advanced  stages  of  the  fabrication.  Data  suf- 
ficient for  giving  consideration  to  varying  per-ton  investments  are  not  so 
difficult  to  arrive  at  as  would  appear.  Book  costs  of  investment  less  depre- 
ciation is  presumably  shown  in  more  or  less  satisfactory  form  on  the  books 
of  practically  every  company.  Most  of  them  also  have  the  revaluation  as 
of  1913  permitted  under  the  internal  revenue  law.  These  give  bases  of 
comparison  between  companies  and  reveal  the.  cases  of  high  investment  per 
unit  of  output,  so  that  such  cases  may  be  easily  isolated  and  intensively 
studied.  Before  going  into  a  discussion  of  the  mechanism  of  a  pooling  device, 
I  wish  to  suggest  some  devices  for  encouraging  volume  and  economy  of  pro- 
duction. These  may  be.  set  down  as  follows : 

After  determining  a  tentative  cost  price  by  considering  monthly  production 
costs  and  adding  a  unit  profit  as  modified  by  the  legitimate  unit  investment 
and  then  adding  a  small  charge  to  take  care  of  the  operation  of  the  pool: 

First.  Make  a  further  profit  addition  based  upon  a  showing  of  decreased 
operating  costs.  For  example,  if  cost  is  reduced  a  dollar  per  unit,  allow  50 
cents  to  go  to  additional  profit  and  50  cents  to  lowering  price. 

Second.  Similarly  penalize  unwarranted  increases  in  cost  by  deducting  them 
from  allowed  profit.  The  deduction  could  be  continued  to  a  point  of  ex- 
tinguishing the  profit  if  the  production  can  be  dispensed  with  or  can  not  bei 
secured  by  transfer  of  labor,  material,  and  cars  to  lower-cost  operations. 

Third.  Allow  an  increase  in  profit  as  a  return  for  supernormal  production; 
jillowance  to  be  generous  but  apply  only  to  the  tonnage_that  is  above  normal 
production. 

Fourth.  Allow  a  substantial  wage  bonus  to  labor  in  return  for  continuous 
working. 

The  fourth  point  would  best  be  elaborated  a  bit.  Suppose  a  laborer  re- 
ceived 50  cents  an  hour;  after  he  had  worked  15  consecutive  working  days, 


394  HISTORY   OF   PRICES   DURING   THE   WAR. 

set  his  wages  at  55  cents  per  hour  for  so  long  thereafter  as  he  continues  to 
work  without  interruption.  Voluntary  loss  of  time  would  return  him  to  the 
50-cent  wage,  where  he  would  remain  until  he  had  again  worked  15  consecutive 
days.  Holiday  work  might  well  be  counted  as  double  time  (as  two  days  for 
each  holiday)  in  earning  a  place  in  the  bonus  class.  In  case  of  involuntary 
idleness,  forced  by  lack  of  material,  car  shortage,  accident,  or  any  other  cause 
beyond  the  workman's  control,  such  idle  days  should  not  be  held  to  demote 
him  from  the  bonus  class, 

Now  for  the  pooling  plan  : 

The  pool  organization  would  make  use  of  all  existing  agencies  of  production 
and  distribution.  There  need  be  no  resulting  dislocation  of  trade. 

Transactions  would  be  exactly  as  now;  orders  taking  the  same  course  ex- 
cept when,  as  now,  through  priority  orders  or  for  ton-mile  or  other  trans- 
portation or  economic  reasons,  the  pool  manager  might  otherwise  direct.  The 
ore  or  the  coke  or  the  pig  iron  would  be  billed  out  in  the  name  of  the  Govern- 
ment pool,  to  the  immediate  purchaser  at  the  pool  price,  and  at  the  same  mo- 
ment the  mine  or  oven  or  furnace  would  bill  the  Government  pool  for  the  same 
quantity  and  -quality  at  the  price  fixed  for  that  particular  mine,  oven,  or 
furnace.  The  pool  \vould  settle  monthly  with  each  mine,  oven,  or  furnace 
for  all  material  shipped.  There  would  be  added  to  the  price  paid  the  pro- 
ducer such  small  margin  as  would  care  for  the  expenses  and  hazard  of  the 
pool.  A  surprisingly  small  initial  working  capital  would  be  required  and  it 
would  be  in  the  nature  of  a  revolving  fund,  augmented  by  any  net  profits  which 
might  accrue  to  the  pool  as  time  passed.  The  pool  (the  Government)  would 
have  ownership  of  the  material  only  for  the  instant  of  time  when  the  title 
passed  from  the  producer  through  the  pool  to  the  immediate  purchaser,  but 
that  instant  of  ownership  would  be  absolute  ownership. 

I  am  saying  that  the  single-price  theory  has  failed  in  practice.  We  have 
seen  unduly  high  prices  raised  and  raised  again  on  the  representation  of  fear 
of  future  increase  in  costs,  and,  as  industries  are  interrelated  and  buy  and  sell 
from  and  to  each  other,  and  as  we  raise  one  because  it  anticipates  an  increase 
in  cost,  and  raise  others  on  the  same  anticipation,  these  raises,  reacting,  tend 
to  justify  the  darkest  fears.  In  other  words,  business  oonporn^  are  busy 


7  skinning  each  other  and  the  publicand  the  Government  is  paying  for  the  hide 
that  i!Tremo?eTt:  —  With  respect  to  iron  and  steel,  all  these  considerations  seem 
to  argue  that  a  number  of  changes  in  policy  might  well  be  adopted  at  this  time. 

First.  Reduce  the  rail  freight  rate  on  iron  ore  to  a  figure  which  would  repre- 
sent the  cost  of  the  service  and  a  fair  average  transportation  profit;  also  con- 
trol lake  freight  rates. 

I  Second.  Have  the  Government  buy  all  iron  ore  and  distribute  it  to  econom- 
ically efficient  furnaces  at  a  composite  price  which  shall  likewise  absorb  trans- 
portation charges. 

Third.  Treat  coke  the  same  as  iron  ore  by  pooling  it  and  distributing  it  at  a 
uniform  price,  absorbing  transportation  charges, 

Fourth.  Buy  all  pig  iron  through  the  Government  pool  and  distribute  it  at  a 
uniform  price,  absorbing  freight  differentials. 

Fifth.  From  this  point  seek  to  establish  no  other  composite  price  through 
pooling  except  in  such  cases  as  where  the  Government  buys  practically  the 
total  output,  as  in  the  case  of  rails,  ship  material,  munitions,  etc.  In  such 
cases  apply  the  pooling  system  and  distribute  the  surplus  to  the  public  at  a 
composite  price. 

Sixth.  Secure  stimulated  production  by  generously  increasing  the  profit  on  all 
\  tonnage  produced  above  the  normal  production  as  shown  by  recent  experience, 
and  similarly  reward  efficiency  and  lowering  of  costs,  as  set  forth  above. 


GOVERNMENT   CONTROL   OVER  PRICES.  395 

Looking:  forward  to  the  post-war  contest  for  world  markets,  a  present  and 
determined  effort  to  return  to  normal  would  seem  to  be  prudent. 

5.  Mr.  W.  F.  Grephart,  Federal  food  administrator  in  Missouri, 
wrote  the  following  memorandum  011  the  "  Governmental  Policy  of 
Fixing  One  versus  Several  Prices  on  a  Single  Commodity : " 

It  is  assumed  in  the  statement  which  follows:  First,  that  there  are  several 
competitors  producing  the  commodity  with  different  costs  of  production ; 
second,  that  in  the  system  of  taxation  there  is  an  excess  profits  tax  or  income 
tax  of  a  character  which  will  enable  the  Government,  if  it  so  desires,  to  reduce 
the  larger  profits  of  those  producers  who  are  able  to  produce  well  under  the 
single-fixed  price.  The  following  reasons  may  be  urged  in  favor  of  a  single- 
fixed  price : 

1.  It  is  in  harmony  with  the  present  organization  of  industry,  one  of  whose 
chief  characteristics  is  competition.     This  is  true  because  the  primary  justi- 
fications of  the  competitive  system  is  that  a  premium  is  placed  on  most  efficient 
production.     The  inefficient   man   is,    in   time,   compelled  because  of  his  high 
costs  to  go  out  of  business  in  favor  of  the  more  efficient,  and  the  public  secures 
the  benefit  of  low-cost  production.     Yet,  under  a  single-price  system,  the  price 
must  necessarily  be  fixed  at  the  particular  time,  at  or  near  the  cost  of  produc- 
tion of  that  producer  who  has  the  highest  costs,  because  his  production  is 
necessary  in  order  to   secure  the  desired   supply   or   quantity.     At   the  same 
time,  the  more  efficient  producers  are  encouraged  by  their  liberal  margins  of 
profit  to  increase  their  output.     There  is  thus  an  opportunity  for  tha  Govern- 
ment to  do  one  of  two  things,  or  to  do,  in  part,  both  of  two  things:  First,  the 
Government  may  take  all  or  a  large  part  of  whatever  is  excess  profit;  or  it 
may,  when  the  production  capacity  of  the  more  efficient  plants  has  increased, 
readjust  its  one  fixed  price  on  a  lower  level,   thus  securing  for   society   the 
advantage  of  a  lower  price  and   maintaining  all   the  beneficial  efforts  of  a 
normal  competitive  condition. 

It  may  be  urged  that  the  more  efficient  producers  under  the  above  condi- 
tions will  not  increase  their  output  and  thus  make  possible  the  elimination  of 
the  less  efficient,  but  such  a  result  does  not  occur  in  actual  business.  It  may 
also  be  urged  that  the  less  efficient  should  not  be  put  out  of  business,  but  this 
is  what  actually  occurs  in  normal  times,  and  in  addition,  by  the  intervention 
of  the  Government  in  stabilizing  the  price  on  the  basis  of  this  less  efficient 
producer,  the  Government  protects  him  for  a  period,  thus  giving  him  every 
opportunity  to  improve  his  business  and  reduce  costs.  In  addition,  there  is 
under  the  present  industrial  organization  and  legal  system  no  vested  right  of 
any  producer  to  remain  in  business,  especially  if  he  can  not  render  society  a 
service  in  fair  costs  of  production. 

2.  The  single-price  system  is  much  less  complex  and  more  easily  administered. 
It  is  a  very  difficult  and  often  an  impossible  task  to  determine  production  costs 
for  the  many  different  producers  of  a  commodity.    No  two  costs  would  be  the 
same,  and  in  an  industry  where  there  are  many  different  producers,  it  would 
take  many  months  to  arrive  at  approximate  costs.     Then  again  changes   in 
costs,  which  at  the  present  time  are  marked,  would  require  frequent  and  com- 
plete readjustment  of  the  price  schedules  for  the  different  producers.     Again, 
the  multiple  or  several-price  system  would  result  in  a  static  condition  in  the 
industry.     Every  one  would  continue  as  a  producer,  whether  or  not  his  costs 
would  entitle  him  to  remain. 

3.  A  multiple  or  several-price  policy  might  have  inequitable  results  on  war  tax- 
ation.    This  is  true  because  these  various  prices  would  be  fixed  so  that  no 


396  HISTORY   OF   PRICES   DURING   THE   WAR. 

excess  margin  of  profit  would  be  left  to  the  producers.  That  is  to  say,  the  Public 
Treasury  would  receive  little  or  no  tax  from  this  particular  source  to  be  expended 
in  whatever  form  of  public  expenditure  it  desired;  the  consumers  of  this  par- 
ticular commodity,  under  a  varying-price  system  might  escape  their  just  share 
of  taxes.  Under  a  single-price  system  the  higher  prices  which  they  may  pay  for 
the  product  goes  in  larger  part  into  the  Public  Treasury  in  the  form  of  taxes. 

4.  Under  a  several-price  system  large  opportunity  is  given  for  comparisons 
which  is  likely  to  embarrass  the  Government.   One  producer  thinks  another  is 
allowed  an  unfair  margin.    Another  complains  that  his  costs  are  increasing  and 
desires  a  larger  margin.  No  one  of  the  producers  has  any  great  inducement  to 
reduce  costs  under  the  static  conditions  of  several  prices. 

5.  Whether  or  not  the  numerous  prices  would  be  constitutional  is  primarily  a 
question  for  the  courts,  but  in  any  event  there  is  in  such  a  policy  a  large 
element  of  inequality.     It  is  taking  as  a  permanent  measuring  unit  for  the  in- 
dustry the  least  efficient  and  penalizing  the  more  efficient.    However  important 
it  is  in  these  war  times  to  stabilize  certain  prices  for  certain  essential  products 
this  should  not  be  undertaken  at  the  expense  of  stabilizing  industrial  organiza- 
tion.    No  policy  of  price  fixing  can  be  successful  except  as  it  is  established  for 
short   periods.      Adjustments   must   be    made    and    therefore   a    multiple-price 
system  makes  such  adjustments  much  more  difficult,  even  assuming  that  the 
the  original  system  be  successfully  established. 

6.  On  the  basis  of  my  experience  as  a  Food  Administrator  in  fixing  food  prices 
through  the  interpretation  of  fair  prices,  it  seems  fairly  clear  that  any  system 
of  fixed  prices  must  be  simple  and  most  easily  administered  if  it  is  to  have 
a  large  measure  of  success;  second,  that  spreads  in  prices  or  different  prices 
always  tend  in  their  actual  workings  to  encourage  the  perpetuation  of  high 
prices.    In  our  work  we  quote  only  one  price  on  each  commodity  of  the  same 
grade. 

6.  Mr.  H.  M.  Charming,  chief  of  the  legal  section  of  the  War  In- 
dustries Board,  wrote  the  following  memorandum  on  "  General 
Price  Fixation  on  Cost  Basis:" 

We  have  been  asked  for  an  expression  of  opinion  on  the  following  problem. 
In  determining  a  general  price  for  certain  staple  commodities  such,  for  example, 
as  copper  or  steel,  it  is  apt  to  appear  that  there  is  quite  a  wide  range  between 
the  costs  of  the  principal  producers.  It  may,  nevertheless,  be  essential  to 
maintain  the  production  of  the  higher-cost  concerns,  and  also  at  the  same  time 
may  be  thought  desirable  to  avoid  paying  inordinately  large  profits  to  the  low- 
cost  members  of  the  industry.  It  has  been  suggested,  and  the  idea  strongly 
attracts  many  people,  that  prices  for  certain  products  be  determined  upon  the 
basis  of  individual  cost,  allowing  substantially  the  same  profits  to  all  whose 

production  is  requisite. 

••• 

BY   AGREEMENT. 

The  price-fixing  committee  operates  either  by  means  of  agreement  or  in  an 
advisory  capacity  to  the  purchasing  departments.  The  committee  can,  with 
considerable  freedom,  enter  into  agreement  with  producers  to  adopt  any  basis 
of  price  fixation  which  may  be  acquiesced  in  by  substantially  all  of  them.  It 
is  not  perfectly  clear  that  the  low-cost  producer  who  has  refused  to  agree  to 
sell  his  product  at  cost  plus  a  fixed  profit  could  not  make  a  fairly  plausible 
claim  that  an  arrangement  of  this  character,  entered  into  between  the  other  pro- 
ducers and  the  price-fixing  committee  (acting  in  concert  with  intending  pur- 
chasers), would  constitute  an  unreasonable  restraint  of  trade.  We  incline, 


GOVERNMENT   CONTROL   OVER  PRICES.  397 

however,  to  the  opinion  that  such  an  arrangement  would  be  upheld  by  the 
courts  as  a  reasonable  restraint. 

Failing  agreement  the  Government  would,  of  necessity,  resort  to  its  affirma- 
tive powers.  These  powers  would  be  (a)  to  requisition  existing  goods;  (&) 
to  commandeer  future  production ;  (c)  to  take  over  and  operate  the  plants  them- 
selves. 

(A)    REQUISITION  OF  EXISTING  GOODS. 

We  have  in  a  previous  memorandum  to  you  expressed  the  opinion  that  the 
measure  of  just  compensation  for  existing  property  requisitioned  would  be  the 
fair  market  value  of  such  property,  subject  to  certain  qualifications  which  we 
believe  would  exist  in  the  absence  of  a  fair  market.  It  would  follow  that  the 
individual  cost  plus  a  profit  probably  would  not  be  the  measure  adopted  by  the 
courts  to  determine  compensation  for  such  property. 

(B)     COMPULSORY    ORDERS    FOR   FUTURE   PRODUCTION. 

With  relation  to  compulsory  orders  for  production  of  ordinary  staple  com- 
modities, such  as  copper  or  standard  steel  plates,  as  we  construe  the  statutes, 
there  is  contemplated  a  taking  of  the  finished  commodity  rather  than  an 
order  for  involuntary  performance  of  service  (national  defense  act  of  June  3, 
1916,  sec.  120 ;  naval  appropriation  act  of  July  1,  1918,  p.  18.  The  language  used 
in  the  statutes,  and  the  clearer  constitutionality  which  would  result  from  the 
first  construction,  tend  to  bring  us  to  our  conclusions,  although  there  might 
be  commandeer  orders  issued  which  would  approach  very  closely  orders  for 
the  performance  of  services.  Under  our  views  compulsory  orders  require  the 
delivery  of  a  finished  product,  and  the  measure  of  just  compensation  would  be 
substantially  the  same  as  for  existing  property  requisitioned — the  fair  value  of 
the  product. 

We  should  qualify  this  statement  by  the  opinion,  earlier  expressed  to  your 
committee,  that  the  highest  cost  producer  could  not  be  compelled  to  work  at 
jsn  absolute  loss.  The  burden  would  probably  rest  upon  him  to  establish  that 
what  would  be  fair  value  and  just  compensation  for  the  rest  of  the  industry 
would  not  be  just  compensation  to  him.  In  time  of  shortage  it  may  be  neces- 
sary to  compel  many  such  producers  to  operate  and  to  pay  them  in  excess  of 
the  actual  value  of  their  product. 

Of  course,  some  differentials  based  on  local  conditions  might  properly  be 
made.  Market  values  in  one  part  of  the  country  often  vary  from  those  in 
other  parts  of  the  country,  and  the  same  considerations  which  affect  market 
values  might  properly  be  taken  into  account  in  the  determination  of  just  com- 
pensation or  in  price  fixation. 

Although  a  good  deal  of  argument  can  be  made  on  the  other  side  of  the 
question,  we  are  unable  to  advise  the  price-fixing  committee  that  under  com- 
pulsory orders,  dissatisfied  producers  would  not  be  able  ultimately  to  recover 
through  the  courts  compensation  based  upon  fair  market  value  or  its  equiva- 
lent. 

(C)     TAKING    OVER    PLANTS. 

Under  certain  conditions  the  Government  has  the  power  to  take  over  plants. 
Where  the  Government  does  take  over  and  operate  a  plant  the  compensation  is 
not  based  at  all  either  upon  market  value  of  the  product  or  upon  the  cost  of 
production,  but  is  established  as  just  compensation  for  use  of  the  plant,  which, 
in  turn,  is  arrived  at  through  the  medium  of  market  value  of  plant  appurte- 
nances. 


398  HISTORY   OF   PRICES   DURING   THE    WAR. 


In  conclusion  we  would  say  that  although  in  some  industries  it  might  be 
possible  to  obtain  the  required  volume  of  production  upon  a  cost  basis  without 
creating  litigation,  it  appears  to  us,  from  a  legal  standpoint,  highly  desirably 
to  avoid  the  difficulties  which  are  apt  to  attend  the  cost  basis  of  price  deter- 
mination, and  to  adhere,  so  far  as  practicable,  to  the  flat-price  basis. 

7.  Mr.  Robert  S.  Brookings,  chairman  of  the  price-fixing  com- 
mittee, wrote  the  following  memorandum  on  the  question  of  fixing 
"One  Price  or  Several  Prices:" 

Referring  to  the  discussion  of  one  price  or  several  prices  and  to  avoid 
losing  ourselves  in  a  maze  of  abstract  argument,  suppose  we  simply  investi- 
gate the  steel  situation  to-day  with  the  view  of  ascertaining  whether  or  not  any 
change  in  price  or  method  is  necessary  or  desirable. 

First.  Have  we  any  evidence  under  the  present  one-price  system  of  any 
failure  in  efficiency  ? 

I  have  never  heard  of  any.  On  the  contrary,  the  steel  producers  seem  to  have 
shown  remarkable  efficiency,  and  we  hear  only  of  shortage  in  coking  coal, 
transportation,  and  blast  furnace  capacity,  which  the  steel  companies  seem 
to  be  making  every  possible  effort  to  improve, 

Second.  Are  the  prices  of  steel,  as  fixed  at  present,  abnormally  high,  as 
reflected  in  the  profits  of  the  lowest-cost  producer? 

Careful  computation  would  indicate  that,  at  present  market  prices,  the 
Steel  Corporation  will  receive  this  year  gross  profits  of  about  $420,000,000, 
of  which  the  new  excess  profits  and  income  taxes  will  absorb  ,$247,500,000, 
leaving  $172,500,000  or  about  nine  per  cent,  on  their  investment  of  $1,887, 
000,000.  Of  this  sum,  the  Steel  Corporation  say  they  should  set  aside 
$36,000,000,  or  2  per  cent  on  their  investment  to  take  care  of  depreciation  and 
replacement  which  the  Federal  Government  will  not  permit  them  to  deduct  in 
figuring  their  excess  profits  taxes. 

While  the  Steel  Corporation's  costs  are  lower  than  those  of  the  six  or 
seven  other  companies  which  with  it  produce  over  80  per  cent  of  the  steel, 
a  careful  comparison  of  the  net  results  of  -their  year's  business  indicates 
that  they  all  show  as  large  a  return  on  their  investment  as  the  Steel  Cor- 
poration, which  is,  of  course,  accounted  for  by  the  ratio  of  their  production 
to  capital. 

It  is  also  shown  that  the  so-called  nuirfber  three  or  small  companies  special- 
ize largely  in  steel  refinements  and  that  their  return  on  investment,  a^ 
reported  to  us  last  year,  was  larger  than  the  Steel  Corporation's. 

We,  therefore,  find  all  steel  companies  practically  on  the  same  footing. 
It  is  then  simply  a  question  of  whether  or  not  the  net  returns  on  investment 
of  8  or  10  per  cent  in  the  steel  industry  are  unreasonable  as  compared  with 
other  investment  securities,  taking  into  consideration  the  risks  of  manu- 
facturing. 

Third.  Conceding  as  an  abstract  argument,  however,  that  prices  should  not 
be  made  with  any  regard  to  the  securing  of  excess  profits  taxes,  and  that  the 
economic  national  health  is  best  preserved  by  a  low  range  of  prices,  inasmuch  as 
the  Government  has  formulated  its  revenue  program  for  this  year  based  upon 
large  receipts  from  excess  profits,  would  it  be  wise  at  the  present  time  to 
propose  any  system  of  price  fixing  which  would  wipe  out  all  excess  profits? 
Or,  in  other  words,  even  if  the  steel  manufacturers  were  willing  to  practi- 
cally reduce  the  price  of  steel  so  as  to  wipe  out  the  excess  profits  —  which  I 
am  sure  they  fire  not—  should  we  encourage  such  a  proposition? 


GOVERNMENT    CONTROL   OVER   PRICES.  399 

Referring  to  the  detailed  cost  sheets  presented  by  the  Federal  Trade  Com- 
mission, I  would  briefly  call  attention  to  the  following  points: 

They  have  not  yet  finished  their  report  on  cost  of  ore,  which  they  expect  to 
have  ready  in  a  day  or  two.  Their  costs  of  coke,  both  beehive  and  by-product, 
for  the  month  of  June,  as  compared  with  the  month  of  April  (which  we  used 
at  our  May  meeting)  show  practically  no  change. 

Referring  to  the  pig-iron  reports  for  the  same  months,  the  costs  would  also 
appear  to  be  about  the  same.  A  study  of  the  figures  submitted  to  you  will 
show  that,  as  a  matter  of  fact,  the  steel  companies  producing  four-fifths  of  the 
entire  steel  product  produce  their  own  coke  and  pig  iron,  and  have  conse- 
quently little  or  no  interest  in  the  prices  we  may  fix  on  raw  material  or  semi- 
finished products. 

This  reduces  the  interest  in  these  items  practically  to  the  merchant  pig- 
iron  companies.  You  will  notice  from  the  report  of  these  companies  that  they 
produce  only  about  200,000  tons  of  basic  pig  per  month  (and  practically  no 
Bessemer),  which  basic  pig  must  necessarily  go  to  the  so-called  No.  3  or 
smaller  companies,  which  produce  such  refinements  as  to  make  the  question  of 
a  dollar  or  two  per  ton  on  pig  a  not  very  vital  matter. 

The  balance  of  the  merchants'  companies'  production  (say  300,000  tons  per 
month)  is  .foundry  pig,  which  finds  its  market  in  products  over  which  we  have 
exercised  little  or  no  control  in  prices. 

It  would  seem  therefore  that  our  entire  steel  price-fixing  problem  is  reduced 
to  a  question  of  whether  or  not  there  are  any  differentials  in  cost  which  the 
present  range  of  prices  makes  burdensome  to  any  important  producers;  and 
I  have  failed  to  find  any  evidence  of  this,  except  in  the  case  of  the  Bethlehem 
Co. ;  and  we  have  no  means  of  knowing  whether,  in  the  last  analysis,  it  is 
burdensome  to  them  until  the  Federal  Trade  Commission  makes  a  special 
report  on  their  costs  and  their  Government  contracts  for  shipbuilding  and 
ordnance,  with  a  view  to  ascertaining  the  facts.  Notwithstanding  Bethlehem's 
high  costs,  they  seem  to  have  made  good  profits  last  year,  and  I  am  told  they 
are  doing  very  well  at  the  present  time. 

P.  S. — It  is  quite  probable  that  a  few  small  merchant  producers  of  basic 
pig  and  a  larger  proportion  of  producers  of  foundry  pig  will  show  that  August 
costs  will  leave  them  no  profit  at  present  prices.  So  that  we  may  have  to 
consider  an  advance  in  pig  iron,  which  would  not  affect  steel  prices,  or  else 
require  the  big  integrated  companies  to  absorb  this  production  at  a  price  which 
will  maintain  production, 

(5)  PRICES   FIXED  ABOVE  THE  "BULK   LINE"   OF   PRODUCTION. 

The  theoretical  arguments  urged  before  the  price-fixing  ccmimittee 
in  favor  .of  allowing  each  producer  a  set  margin  of  profit  above  his 
individual  cost  of  production  soon  gave  way  to  the  practical  diffi- 
culties involved.  The  committee  came  to  believe  that  any  theory  of 
determining  fixed  prices,  akin  to  the  cost-plus  rule,  made  for  en- 
couragement to  the  less  efficient  high-cost  producers.  There  seemed 
no  disposition  to  countenance  a  practice  that  would  give  the  high- 
cost  producer  precisely  the  same  war-time  guarantee  that  accrued 
to  the  low-cost  producer,  since  there  was  not  at  hand  the  enormous 
administrative  machinery  necessary  to  enforce  a  variable  price.  The 


400 


HISTORY   OF   PRICES   DURING   THE   WAR. 


price-fixing  committee  and  the  Fuel  Administration  thereupon  de- 
termined to  throw  overboard  the  niceties  of  the  variable  price,  and 
to  fix  a  flat  price  somewhere  above  the  "  bulk  line  "  of  production. 
The  term  "  bulk  line  "  of  production,  as  it  came  into  use  during  the 
war,  meant  the  indispensable  amount  of  any  commodity  that  the  war 
program  required  should  be  produced,  and  the  "  bulk  line  "  of  cost 
meant  the  unit  cost  to  produce  the  last  unit  lot  of  that  requirement 
by  the  marginal  producer.  It  was  the  cost  of  production  at  the  hands 
of  this  marginal  or  bulk  line  person  usually  which  formed  the  basis 
for  the  price  fixed.  An  arrangement  of  the  costs  of  Beehive  coke,  for 
example,  shows  that  there  was  a  gradual  shading  in  the  cost  of  pro- 
duction, from  $2.93  per  ton  by  the  lowest-cost  producers  to  $11.45 
per  ton  by  the  highest-cost  producers.  But  it  was  found  that  these 


WtPE    PPODUCEQ 
SEPTEMBER  1910 


.*  .9' 

ION  COSTS  DEB 


ENTASE  OF  THE.  TOTAL  QUTDUT  PRODUCED  AT  COST  SHOWN  BY  VERTICAL  SCALE. 


Costs   at   which    different   portions   of   the    output    of    coke,   beehive,    were    produced    in 

September,    1918. 

highest-cost  producers  had  a  capacity  to  supply  only  the  last  10  per 
cent  of  maximum  production,  and  that  virtually  90  per  cent  of  the 
possible  output  of  the  country  would  be  sustained  by  fixing  the  price 
at  $6  per  ton.  It  was  the  unwritten  rule  both  of  the  price-fixing  com- 
mittee and  the  Fuel  Administration  to  fix  a  price  high  enough  to 
assure  the  output  of  about  85  or  90  per  cent  of  the  absolute  maximum 
production  of  the  country. 

It  is  of  especial  interest  to  study  by  way  of  example,  the  several 
production  costs,  which  follow  in  table  or  chart  form  as  reported  by 
the  Federal  Trade  Commission  or  the  Tariff  Commission,  and  the 
prevailing  fixed  prices  for  the  same  months.  The  Government  fixed 
price  of  $32  per  ton  for  basic  pig  iron  in  September,  1918,  clearly  was 
high  enough  to  bring  out  over  90  per  cent  of  the  possible  production. 


GOVERNMENT   CONTROL   OVER  PRICES. 


401 


The  base  price  of  $73  per  gross  ton  for  forging  ingots  (open  hearth) 
was  apparently  high  enough  to  draw  out  virtually  the  whole  pro- 
duction. Structural  shapes  were  fixed  at  a  point  to  encourage  over 
90  per  cent  of  the  production,  and  so,  too,  were  plates. 


*so. 

40. 
3 

!; 

KO. 

-o 

I 

10. 

COSTS 

AT  WHICH    DIFFERENT    PORTIONS   OF  THE    OUTPUT 
OF 

PIG  mow,  BASIC 

WEH-E  PHQDUCED 

rw 

SEPTEMBER    191S. 
*~ 

/ 

405.- 

7 

f 

JO. 

• 
20.       <» 

o 

? 

10. 
o«f«. 

/ 

Go 

ein, 

iveri 

t  E 

ICC 

S3^. 

o. 

/ 

/ 

/ 

x 

f^- 

— 

? 

—  —  • 

^ 

s 

,  • 

.—  -  • 

• 

—  - 

;=^" 

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= 

-... 



—  — 

—  • 

J                    10                  20               .  30                   40                 50                  60                  7O                  8O                9O               1O 

Percentages    of     the      total       out.pUt                            iu.4.atii«i  »  I 
•protfuted     at  Boosts.  showrx  j>w    vertical  &cal«  . 

Costs  at  which  different  portions  of  the  output  of  pig  iron,  basic,  were  produced  in 

September,  1918. 

The  two  cost  lines  for  Douglas  fir  lumber  in  Washington  and 
Oregon  show  how  the  cost  curve  for  October,  1918,  ran  above  that  of 
the  spring  previous.  The  previous  maximum  price  of  $26  per  thou- 
sand was  left  unchanged,  however,  because  the  same  output  was  no 
longer  needed.1 


Data  given  by  F.  W.  Taussig. 


125547°— 20 26 


402 


HISTORY  OF  PRICES  DURING  THE  WAR. 


The  earlier  fixed  price  for  the  1917-18  crop  of  beet  sugar  of  $147 
per  ton  at  New  York,  was  found  to  afford  adequate  return  for  the 


;:::L_ 


Costs 
at  which  different  portions  of  the  output 

DOUGLAS  FIR 

were   produced 

line  for  March  and  ftprll,  1918,  the  upper  for  October,  191! 


Percentage  of  total  output'  produced  at  various  costs. 

--       '-          '-" 


Costs  at  which  different  portions  of  the  output  of  Douglas  Or  were  produced  in  March, 

April,   and    October.   1018. 

production  only  of  about  82  per  cent  of  the  crop.1  The  Food  Admin- 
istration, therefore,  after  an  investigation  into  the  costs  of  producing- 
sugar  beets,  found  it  necessary  later  to  increase  the  price  to  $176.40 


COSTS 

at  which  different  portion  s  of  the  o  utput 


Tons  produce d  at  various  cost-s 


Costs  at  which  different  portions  of  the  output  of  beet  sugar  were  produced  in  1917-18. 

per  ton  in  order  to  cover  costs  for  about  90  per  cent  of  the  forth- 
coming crop. 


1  The  1917-18  crop  of  beet  sugar  was  about  848,800  tons. 


GOVERNMENT  CONTROL  OVER   PRICES. 


403 


UNITED  STATES  FUEL  ADMINISTRATION 


. 

Average  adjusted  costs,  bulk  lines,  and  prices  originally  fixed  for  all  bituminous  coal 
districts  charted  during  August  and  September,  1917,  37,357,000  tonnage,  average  of 
August  and  September,  1917. 


UNITED"  STATES  FUEL  AQMINfSTRATtON 


_J 


Graphic  chart  showing  cost  of  production  of  anthracite  coal  in  Pennsylvania  anthra- 
cite region  during  the  period — December,  1917,  to  May,  1918  ;  reported  cost,  adjusted 
cost,  tons  reported  by  83  operators,  33,039,655 ;  tons,  monthly  average  reported, 
5,506,609. 


404  HISTORY   OF  PRICES   DURING  THE   WAR. 

COSTS  FOUND  BY  THE  FEDERAL  TRADE  COMMISSION  FOR   SEPTEMBER,    1918. 

BEEHIVE    COKE. 

[Government  price  $6  per  net  ton.] 

Production  cost 
per  gross  ton. 

Companies  producing  up  to  00  per  cent  of  total $2.  93-$4.  44 

Companies  producing  over  60  to   70  per  cent  of  total 4.  44—  4.  99 

Companies  producing  over  70  to  80  per  cent  of  total 4.  99-  5.  44 

Companies  producing  over  80  to  90  per  cent  of  total 5.  44-  6.  47 

Companies  producing  over.  90  to  100  per  cent  of  total 6.  47-11.  45 

PIG  IRON   (BASIC). 
[Government  price  $32  per  ton.] 

Companies  producing  up  to  60  per  cent  of  total $18.  14-$22.  OG 

Companies  producing  over  60  to  70  per  cent  of  total- 22.  06-  24.  32 

Companies  producing  over  70  to  80  per  cent  of   total 24.  32-  25.  41 

Companies  producing  over  80  to  90  per  cent  of  total 25.  41-  27.  49 

Companies  producing  over  90   to   100  per  cent  of  total 27.  49-  45.  72 

INGOTS  (OPEN  HEARTH). 
[Government  price  $73  per  ton.] 

Companies  producing  up  to  CO  per  cent  of  total $30.  60-$33.  42 

Companies   producing  over  60  to  70  per   cent  of   total 33.  42-  35.  16 

Companies  producing  over  70  to  80  per  cent  of  total 35.  16-  39.  77 

Companies   producing  over  80  to   90   per  cent  of  total 39.  77-  41.  86 

Companies  producing  over  90  to   100  per  cent  of  total 41.  86-  66.  34 

STRUCTURAL    SHAPES. 

[Government  price  $3  per  100  pounds.] 

Companies  producing  up  to  60  per  cent  of  total $45.  54— 

Companies  producing  over  60  to   70   per  cent  of  total- 45.  54-$49.  37 

Companies   producing  over   70   to  80  per  cent  of  total 49.  37-  52.  07 

Companies   producing  over  80  to  90  per  cent   of   total 52.  07-  57.  69 

Companies  producing  over  90  to   100  per  cent  of  total 57.  69-  76.  79 

PLATES SHEARED. 

[Government  price  $3.25  per  100  pounds.] 

Companies  producing  up  to  60  per  cent  of  total $46.  30-$56.  80 

Companies  producing  over   60   to  70   per  cent  of  total 56.  80-  59.  56 

Companies  producing  over   70  to   80  per  cent  of  total 59.  56- 

Companies   producing  over  80  to  90  per  cent   of  total 59.  56-  66.  28 

Companies  producing  over  90  to   100  per  cent   of  total 66.  28-  82.  25 

MERCHANT    BAR. 

[Government  price  $3.50  per  100  pounds.] 

Companies  producing  up  to  60  per  cent  of  total $44.  82-$48.  45 

Companies  producing  over  60  to  70  per  cent  of  total 48.  45-  48.  74 

Companies  producing  over   70  to   80  per  cent   of  total 48.  74-  53.  38 

Companies   producing  over  80  to   90  per  cent  of   total 53.  38-  68.  98 

Companies  producing  over  90   to  100  per  cent  of  total 68.  98-  87.  15 

One  of  the  most  interesting  studies  of  the  relation  of  bulk  line  to 
the  average  costs  and  price  fixed  is  afforded  by  the  accompanying 
chart,  representing  the  country-wide  costs  of  producing  anthracite 
and  bituminous  coal.  The  engineering  committee  of  the  Fuel  Ad- 
ministration, after  adjusting  the  reported  costs,  established  a  bulk 
line  above  which  the  Fuel  Administrator  personally  allowed  a  per- 
cent of  profit  and  fixed  the  price.  The  latter  two  charts  pertain- 
ing to  coal  prices  fixed  are  designed,  of  course,  to  show  results  for 
the  country  as  a  whole  and  are  not  the  specific  ones  used  by  the  Fuel 


GOVERNMENT   CONTROL   OVER  PRICES. 


405 


Administration  in  setting  prices.  The  price  differentials  for  each 
district  were  actually  determined  by  separate  district  charts,  made, 
however,  in  precisely  the  same  manner  as  these  summary  charts. 

KEY  TO  COST  CHART  OF  BITUMINOUS  COAL. 


State  and  district. 

Average 
tonnage, 
August- 
Septem- 
ber, 1917. 

Per 
cent 
total. 

Costs. 

Bulk 
line. 

Price 
fixed. 

Cumulative,  per 
cent. 

Re- 
ported. 

Ad- 
justed. 

Aver- 
age 
cost. 

Bulk. 

Price. 

Alabama: 
No.  1     

380,000 
185,000 
790,000 
90,000 
272,500 

462.000 
320,000 
145,000 

310,000 
417,  500 
5,  525,  000 
1,770,000 

140,000 
410,000 
475,000 

658,000 
1,135,000 

900,000 

240,000 
130,000 
950,000 

17,000 
40,000 
261,  000 

70,000 

165,000 
591,000 
296,000 
360,000 
1,115,000 

4,310,000 
7,  225,  000 

12,000 
73,000 
80,000 

27,500 

1,625,000 
230,000 

285,000 
842,500 
1,092,000 
890,000 
94,000 
365,000 
52,500 
595,000 
947,  500 

1.02 
.50 
2.12 
.24 
.73 

1.24 
.86 
.39 

.83 
1.12 
14.40 
4.74 

.37 
1.10 
1.27 

1.76 
3.04 

2.41 

.64 
.35 
2.54 

.04 
.11 
.70 

.19 

.44 
1.59 
.79 
.96 
2.99 

11.87 
19.35 

.03 
.19 
.21 

.07 

4.35 
.62 

.76 
2.26 
2.93 
2.38 
.25 
.98 
.14 
1.59 
2.54 

$1.47 
2.49 
1.87 
1.86 
2.50 

2.04i 
1.88 
1.84J 

2.  28J 
1.86 
1.481 
1.58 

2.42 
2.14 
2.16 

1.43 
1.54 

2.02 

2.03 
2.47 
1.89 

2.38 
1.47 
1.55J 

3.05i 

2.38 
1.61 
2.11 
1.61 
1.50 

1.95* 

1.57 

3.38 
2.62 
.83 

2.15} 

.40 
.83 

2!l52 
1.69 
1.92 
1.84* 
1.56" 

$1.48 
2.47 
1.86 
1.96 
2.50| 

1.96J 
1.80 
1.78 

2.26J 
1.83 
1.50* 
1.61" 

2.44 
2.16 
2.21 

1.46 
1.60 

1.91 

2.09 
2.47 
1.89 

2.17 
1.55 
1.73 

3.15J 

2.30 
1.65 
2.02 
1.65 
1.51 

1.98 
1.59 

3.35 
2.71 
1.03 

2.12J 

1.31J 
1.78 

1.62| 
1.65 
1.75J 
1.60 
1.92 
1.72£ 
1.90 
1.88 
1.59J 

$1.68 
2.75 
2.14 
2.16 
2.90 

2.20 
1.84 
1.84 

2.40 
2.00 
1.66 
1.80 

2.60 
2.40 
2.40 

1.65 
1.80 

2.25 

2.40 

2.80 
2.20 

2.25 
1.70 

1.78 

3.54 

2.67 
1.80 
2.35 
1.95 
1.65 

2.22 
1.70 

3.83 
3.00 
1.25 

2.13 

1.60 
2.01 

1.90 
1.80 
2.00 
1.90 
2.05 
2.00 
2.15 
2.02 
1.80 

$2.10 
3.10 
2.50 
2.50 
3.30 

2.55 
2.19 
2.35 

2.75 
2.40 
2.00 
2.00 

3.00 
2.80 
2.75 

2.00 
2.20 

2.65 

2.75 
3.20 
2.60 

2.65 
2.10 
2.35 

3.95 

3.10 
2.20 
2.60 
2.35 
2.00 

2.60 
2.00 

4.35 
3.50 
1.65 

2.50 

2.00 
2.40 

2.30 
2.15 
2.35 
2.25 
2.45 
2.30 
2.40 
2.40 
2.15 

7.34 
98.51 
72.18 
79.35 
99.59 

80.59 
68.94 
68.08 

97.20 
70.06 
21.74 

56.89 

98.01 
95.06 
96.37 

6.32 
49.77 

78.86 

93.89 
98.86 
76.31 

95.10 
24.84 
64.14 

99.97 

97.64 
59.24 
93.  25 
60.20 
24.73 

92..  46 
44.19 

100.00 
99.78 
.21 

93.96 

4.56 
67.69 

57.65 
62.46 
67.07 
52.15 
79.11 
63.44 
76.45 
73.77 
46.73 

24.73 
98.51 
74.09 
74.47 
99.59 

78.25 
60.31 
59.45 

97.20 
69.44 
23.71 
55.21 

97.57 
95.10 
96.37 

6.32 
47.93 

92.57 

94.00 
98.86 
77.01 

95.10 
24.84 
44.89 

99.97 

98.01 
59.06 
93.36 
64.41 
9.31 

90.12 
44.19 

100.00 
99.78 
.21 

71.97 

4.56 
70.06 

63.45 
57.47 
68.32 
62.69 
71.90 
65.39 
74.23 
71.65 
50.47 

48.82 
98.51 
74.23 
74.47 
99.59 

75.71 
54.59 
64.43 

96.10 
69.44 
23.71 
47.80 

97.57 
97.20 
95.27 

6.32 
57.63 

93.36 

94.00 
98.86 
78.25 

90.95 
48.93 
64.04 

99.97 

98.01 
59.22 
90.91 
65.39 
9.31 

90.12 
43.06 

100.00 
99.78 
.21 

72.11 

4.56 
70.06 

62.36 
.53.73 
68.32 
61.60 
72.  04 
63.34 
71.79 
71.65 
51.47 

No  2          

No  3                             

No  4                                      

Colorado: 

Trinidad          

Lignite                         

Illinois: 
No  1                    

Nos  2  and  5                         .... 

Nos  3  4,  and  6     

Indiana                        

Iowa: 
Appanoose        

Des  Moines 

Kansas,  Cherokee,  and  Crawford  .  . 
Kentucky: 

No.  2  (Tennessee  and  Virginia)  . 
No.  3  (east  Kentucky  and  east 
Tennessee) 

Missouri: 
No  1 

No  2     

Montana,  Utah,  and  Wyoming  
North  Dakota: 
North  district          

South  district 

Oklahoma: 
(See  Arkansas.) 
McAllister  

Ohio: 
No.  1.    (See  West  Virginia  No. 
9.) 
Nos  2  and  7 

No.  3     

Nos  4  and  6    

No  5 

No.8     

Pennsylvania: 
No  1  central 

No  2  ,  southwest      

Tennessee.    (See  Kentucky.) 
Texas: 
Bituminous  No  1          

Bituminous  No  2 

Lignite     

Utah.    (See  Montana.) 
Virginia: 
(See  Kentucky.) 
Upper  Clinch 

West  Virginia: 
No  1  ,  Pocahontas      

No  2  Tug  River 

Nos.  3  and  4,  Thacker  and 
Kenova 

No  5  Logan 

No.  6,  New  River    .... 

No.  7,  Kanawha 

No.  9,  Pomeroy... 

No.  l6  . 

No.  11,  Preston 

No.  11  ,  upper  Potomac 

No.  12,  Fairmont     

No.  13  including  Pennsylvania 
(  No.  2). 

Wyoming.    (See  Montana.) 

406 


HISTORY  OF  PRICES  DURING  THE   WAR. 

KEY  TO   COST  CHART   OF  ANTHRACITE   COAL. 


Ton- 
nage. 

Costs. 

Ad- 
justed 
standard 
per  cent 
sizes. 

General. 

Company. 

Individual. 

Re- 
ported. 

Ad- 
justed. 

Per 
cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

Per 

cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

Per 

.cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

145,  672 
46,277 
1,367 
5,231 
9,740 
119,  637 
80,389 
2,799 
13,438 
14,  122 
24,981 
28,578 
120,063 
43,957 
126,571 
132,005 
122,642 
145,  292 
143,369 
279,040 
69,850 
266,955 
31,226 
212,932 
88,  193 
87,622 
371,  192 
315,537 
450,209 
204,78-3 
376,  876 
182,  572 
198,420 
26,  778 
365,  160 
337,  037 
183,059 
505,  178 
639,  950 
306,  519 
417,  865 
239,  712 
228,806 
214,  648 
159,  284 
30,404 
484,884 
184,142 
99,  147 
195,  067 
255,547 
108,  359 
139,  848 
102,  590 
260,  069 
310,445 
•83,  971 
190,  071 
100,  473 
10,  764 
112,  386 
77,  261 
16,014 
51,076 
24,815 
94,  535 
38,.a71 
39,667 
81,560 
78,  899 
65,090 
28,722 
12,919 
365,099 
37,  175 
27,  960 
242,  028 
31.141 

$4.  961 
5.26 
4.52 
4.96 
4.36 
4.30 
4.76 
5.998 
4.64 
3.37 
4.88 
4.21 
2.92 
4.59 
3.72 
2.77 
3.47 
3.65 
3.80 
4.77 
3.95 
5.77 
4.77 
5.24 
6.04 
6.69 
4.97 
4.32 
5.18 
3.96 
4.02 
5.24 
4.34 
3.83 
4.67 
3.37 
5.25 
3.05 
2.53 
3.14 
3.25 
3.42 
2.77 
3.34 
3.98 
4.01 
2.81 
3.39 
3.57 
3.21 
2.65 
4.19 
3.49 
4.11 
3.09 
2.84 
3.77 
3.56 
4.64 
4.05 
4.23 
5.20 
5.15 
5.42 

3l  19 
5.05 
3.65 
4.64 
5.06 
3.91 
5.07 
5.22 
3.17 
4.00 
3.41 
2.87 
3.80 

$4.783 
5.45 
4.51 
4.14 
4.06 
4.46 
5.28 
5.77 
4.49 
3.78 
5.40 
4.22 
3.27 
4.05 
3.32 
3.04 
3.54 
3.77 
3.88 
4.82 
4.12 
5.39 
4.69 
5.03 
5.69 
6.30 
4.66 
3.77 
4.47 
3.89 
4.04 
4.92 
4,18 
3.83 
4.04 
3.27 
5.23 
2.80 
2.64 
3.18 
3.42 
3.70 
2.92 
3.24 
3.90 
4.18 
2.87 
3.71 
3.51 
3.44 
2.98 
4.23 
3.67 
4.45 
2.98 
3.05 
3.79 
3.67 
4.56 
4.49 
4.35 
4.71 
5.23 
4.85 
4.48 
3.28 
5.67 
4.00 
4.44 
4.86 
3.94 
4.93 

-  3.6 
+  3.4 

"~'6."92" 
+  4.5    : 
+  3.6    i 
+  11.1 
-  0.5 
+  13.2 
+  6.8 
+  10.8 
+  0.1 
+  5.3 
+  1.0 
-10.65 
+  5.46 
+  0.72 
+  3.22 
+  2.27 
+  1.1 
+  4.6 
+  1.7 
-  1.38 
-  3.96 
-  5.86 
+  3.44 
-  5.22 
-  9.00 
-  8.  51 
-  3.63 
—  0.18 
-  3.59 
—  5.95 
-  5.98 
-  7.72 
-  3.10 
—  1.70 
—  8.  37 
-  2.76 
-  1.94 
-  1.13 
+  4.03 
-  4.24 
-  4.49 
-  1.94 
—  2.51 
-  1.29 
+  4.93 
-  1.77 
+  2.5 
+  3.23 
-  1.98 
+  3.23 
+  6.33 
-  3.  74 
+  0.87 
+  0.65 
—  1.35 
-  1.9 
+  10.7 
+  4.7 
-  3.0 
+  4.4 
-  9.5 
+  4.3 
+  1.1 
+  16.9 
+  2.7 
-  2.0 
-  3.1 
+  3.7 
-  2.6 
+  1.8 

0.44 
.14 
.01 
.02 
.03 
.36 

87.70 
95.64 

78.16 
87.72 
74.87 
69.78 

88.87 
98.48 
80.24 
62.00 
60.65 
77.73 

1.83 

.58 
.02 
.07 
.12 
1.50 

81.53 
91.40 
58.08 
81.06 
50.74 
44.64 

80.23 
95.93 
59.36 
36.96 
33.74 
55.77 

.01 

.04 
.04 
.08 
.09 
.36 
.13 
.38 
.40 
.37 
.44 
.43 
.84 
.21 
.81 
.09 
.64 
.27 
.27 
1.12 
.96 
1.36 
.62 
1.14 
.  55 
.60 
.81 
1.11 
1.02 
.55 
1.53 
1.94 
.93 
1.26 
.73 
.69 
.68 
.48 
.09 
1.47 
.56 
.30 
.59 
.77 
.33 
.42 
.31 
.79 
.94 
.25 
.58 
.30 
.03 
.34 
.23 
.05 
.15 
.08 
.29 
.12 
.12 

98.64 
80.49 
29.62 
85.64 
67.60 
12.13 
79.66 
44.28 
5.44 
35.26 
41.70 
48.48 
84.77 
55.39 
98.63 
84.86 
94.40 
98.94 
99.91 
89.36 
71.  94 
93.20 
56.67 
61.29 
94.95 
74.84 
51.70 
81.85 
30.64 
95.50 
15.48 
3.47 
18.19 
23.93 
34.37 
6.13 
23.25 
38.30 
59.41 
7.60 
32.90 
39.92 
21.11 
5.04 
67.97 
36.16 
65.21 
16.27 
10.10 
46.46 
39.59 
80.45 
63.75 
68.52 
93.76 
91.76 
96.64 
82.27 
20.18 
90.23 
41.26 

99.50 
79.52 
43.79 
98.73 
66.50 
22.25 
59.31 
24.12 
11.81 
32.78 
42.79 
49.84 
90.48 
61.98 
98.15 
85.30 
94.36 
99.37 
100.00 
84.62 
43.75 
79.37 
50.46 
58.52 
91.97 
63.23 
46.40 
57.38 
21.73 
96.23 
5.27 
1.94 
17.86 
27.  58 
40.14 
7.98 
19.98 
31.53 
64.54 
6.74 
41.86 
30.21 
28.55 
9-54 
68-07 
38.28 
76-96 
8.77 
12.75 
44.04 
38.86 
81.20 
79.48 
72.11 
86.80 
95.68 
91.42 
79.45 
23.13 
99.10 
52.17 

.04 
.17 

.18 
.31 
.36 
1.51 
.55 

97.23 
65.38 
8.03 
77.10 
39.  94 
2.54 
63.15 

99.07 
56.39 
18.76 
95.35 
42.11 
2.54 
33.62 

0.50 
.53 
.49 

.58 
.57 

54.07 
6.85 
43.96 
50.67 
57.30 

29.66 
14.65 
39.86 
49.53 
56.65 

3.51 

.88 

74.80 
27.71 

84.21 
36.  89 

1.06 
.12 
.85 
.35 
.35 
1.48 
1.26 
1.79 
.82 
1.50 
.73 
.79 
1.07 
1.46 
1.34 
.73 
2.01 
2.55 
1.22 
1.67 
.96 
.91 
.86 
.64 
.12 
1.93 
.73 
.40 
.78 
1.02 
.43 
.56 
.41 
1.04 
1.24 
.33 
.76 

99.16 
88.12 
95.60 
99.51 
100.00 
91.19 
79.07 
94.75 
65.92 
71.00 
96.33 
82.58 
61.42 
86.82 
37.87 
97.06 
19.64 
4.58 
21.90 
29.08 
42.78 
7.76 
34.77 
67.68 
68.78 
9.69 
40.84 
48.49 
25.37 
6.32 
76.12 
45.15 
73.80 
20.68 
14.22 
65.74 
48.09 

99.15 
91.23 
95.59 
99.65 
100.00 
90.34 
50.79 
86.85 
57.  47 
66.59 
9413 
70.73 
53.62 
65.09 
27.37 
97.80 
6.9-4 
2.55 
20.96 
34.22 
47  59 

59.  76 
23.76 
58.85 
72.37 
8.87 
48.95 
36.48 
35.  49 
11.65 
75.92 
45.14 
84.69 
10.63 
15.89 
51.12 
45.90 

1.26 
.14 
1.41 

.97 
.20 
.64 
.31 
1.19 
.48 
.50 

65.21 
31.04 
41.35 
90.82 
88.16 
94.45 
66.97 
7.85 
84.22 
13.58 

62.21 
56.22 
48.60 
72.78 
91.32 
85.17 
56.08 
3.73 
98.  53 
26  91 

.20 
.09 

53.25 
90.62 

52.05 
92.68 

.82 
.36 

22.08 
85.85 

26.41 

88.12 

3.53 
4.19 
3.60 
3.24 
4.01 

-  2.61 
-  8.24 
-  9.95 
-  2.51 
+  0.2 

1.11 
.11 
.08 
.73 
.09 

19.30 
59.  32 
32.98 
11.77 
48.99 

32.41 
64.65 
35.50 
20.71 
54.18 

1.46 
.15 
.11 
.96 

23.36 
68.66 
40.95 
15.18 

39.37 
72.  52 
43.44 
26.08 

.39 

21.26 

23.  OS 

GOVERNMENT   CONTROL   OVER  PRICES.  407 

KEY  TO   COST  CHART   OF   ANTHRACITE   COAI^-Continued. 


Ton- 
nage. 

Costs. 

Ad- 
justed 
standard 
per  cent 
sizes. 

General. 

Company. 

Individual. 

Re- 
ported. 

Ad- 
justed. 

Per 
cent. 

Re- 
ported, 
cum. 

Ad- 
justed 
cum. 

Per 
cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

Per 
cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

163,  227 
33,  476 
396,962 
82,638 
55,  156 
335,330 
407,  650 
382,  336 
172,  128 
217,662 
181,620 
153,522 
108,  589 
147,428 
26.906 
124,  125 
88,528 
97,534 
208,745 
161,504 
187,028 
195,007 
157,978 
159,271 
72,448 
227,685 
113,817 
284,953 
184,  286 
200,475 
64,892 
128,950 
91,027 
104,  168 
53,842 
132,  154 
243,  729 
244,470 
145,  581 
158,  148 
312,  131 
274,  155 
176,881 
98,414 
166,047 
116,247 
300,277 
136,  586 
44,074 
79,355 
83,  152 
30,582 
156,  819 
133,820 
170,527 
65,989 
118,  130 
10,252 
115,  107 
46,953 
50,414 
125,  122 
59,541 
169,394 
29.577 
112,689 
81,969 
97,  579 
278,410 
353,711 
328,971 
325,004 
375,596 
92,113 
138,  344 
272,  981 
116,842 

S3.  77 
5.70 
4.31 
4.67 
3.94 
3.74 
4.33 
3.82 
4.22 
3.95 
4.01 
3.87 
3.23 
3.66 
3.46 
3.24 
5.43 
4.59 
3.98 
4.05 
3.97 
4.02 
4.30 
3.36 
4.81 
3.22 
3.20 
3.04 
3.56 
3.66 
3.60 
3.28 
4.68 
4.50 
3.25 
3.93 
3.57 
3.81 
3.42 
3.84 
2.84 
3.29 
3.53 
4.95 
3.36 
3.35 
3.14 
4.48 
6.46 
4.71 
5.14 
7.04 
5.43 
4.32 
4.97 
5.15 
3.16 
3.78 
3.50 
4.79 
4.77 
3.98 
4.74 
4.42 
4.56 
4.08 
2.60 
4.21 
3.554 
3.337 
2.93 
3.383 
2.83 
3.63 
2.84 
3.27 
2.51 

S3.  73 
5.71 
4.03 
4.16 

-  1.6 
+  0.1 
-  6.36 
-  8.9 
+  2.1 

.49 
.10 
1.20 
.25 

46.21 
97.82 
70.98 
80.74 

42.35 
99.49 
56.27 
62.63 

2.05 
.42 
4.99 
1.04 

16.61 
97.19 
49.63 
66.42 

18.58 
99.03 
33.07 
39.57 

4.01 
4.39 
4.18 
4.37 
4.60 
4.29 
3.66 
3.08 
3.50 
3.06 
3.43 
4.93 
4.26 
3.83 
4.22 
4.11 
4.27 
4.22 
3.22 
5.27 
3.02 
3.11 
2.76 
3.37 
3.31 
3.22 
3.11 
4.51 
3.92 
3.27 
3.61 
3.59 
3.52 
3.22 
3.71 
2.79 
3.17 
3.135 
4.202 
3.  335 
3.526 
3.44 
4.45 
6.01 
4.71 
5.54 
6.11 
5.37 

+  5.51 
+  2.08 
+  7.8 
+  2.3 
+  14.81 
+  5.75 
-  6.0 
-  4.81 
-  5.11 
-13.8 
+  4.75 
-  4.41 
-  7.21 
-  3.88 
+  4.33 
+  3.45 
+  5.42 
-  4.45 
-  5.1 
+  8.48 
-  8.06 
-  5.20 
-11.44 
—  5.81 
-  9.43 
-10.  54 
—  7.01 
-  3.46 
-12.86 
-  3.43 
-  8.14 
-  1.66 
-  9.48 
-  9.55 
-  5.1 
-  9.3 
-  6.56 
-  6.91 
-11.84 
-  4.25 
-    .93 
+  4.3 
-  1.6 
-  2.7 

1.01 
1.23 
1.16 
.52 
.66 
.55 
.46 
.33 
.45 
.08 
.38 
.27 
.30 
.63 
.49 
.57 
.59 
.48 
.48 
.22 
.69 
.34 
.86 
.56 
.61 
.20 
.30 
.28 
.32 
.16 
.40 
.74 
.74 
.44 
.48 
.94 
.83 
.54 
.30 
.50 
.35 
.91 
.41 
.13 
.24 
.25 
.09 
.47 

45.29 
73.41 
51.89 
68.18 
56.05 
59.96 
52.64 
22.13 
42.15 
34.89 
22.51 
97.38 
79.96 
58.83 
63.62 
57.72 
61.88 
75.35 
29.08 
85.56 
21.80 
20.52 
13.95 
39.01 
42.76 
40.86 
25.70 
82.19 
78.15 
22.67 
54.80 
40.66 
50.73 
34.81 
52.18 
11.04 
26.53 
37.61 
87.26 
29.58 
28.60 
17.26 
77.53 
99.63 
82.89 
91.43 
ICO.  00 
97.11 

54.09 
74.77 
64.  39 
72.83 
82.45 
70.95 
37.86 
13.16 
29.91 
12.83 
27.96 
92.95 
68.78 
47.03 
67.47 
61.77 
69.80 
66.98 
17.69 
96.87 
11.41 
14.31 
2.80 
25.18 
23.74 
17.89 
13.97 
80.52 
31.85 
21.89 
35.90 
35.42 
31.30 
18.33 
40.62 
3.74 
15.93 
14.85 
65.76 
24.62 
30.56 
29.46 
77.37 
99.63 
86.06 
98.73 
99.72 
97.34 

1.34 
1.63 
1.52 
.69 
.87 
.72 
.61 
.43 
.59 
.11 
.49 
.35 
.39 
.83 
.64 
.75 
.78 
.63 
.63 
.29 
.91 
.45 
1.14 
.73 
.80 
.26 
.51 
.36 
.42 
.21 
.53 
.97 
.97 
.58 
.63 
1.24 
1.09 
.71 
.39 
.66 
.46 

55.41 
80.70 
60.35 
77.20 
65.10 
69.50 
62.66 
26.71 
51.26 
43.47 
27.20 
97.76 
85:36 
68.51 
73.39 
67.04 
72.32 
83.21 
35.87 
88.41 
26.28 
24.50 
17.63 
47.33 
52.06 
49.72 
31.41 
87.18 
84.59 
27.41 
63.73 
49.46 
58.83 
43.36 
62.05 
12.98 
32.50 
46.60 
89.71 
36.53 
35.23 

62.46 
82.80 
72.25 
80.23 
88.86 
78.83 
44.58 
16.43 
36.08 
16.20 
34.71 
94.48 
76.85 
54.45 
75.49 
69.94 
77.63 
74.85 
22.06 
98.09 
14.12 
17.94 
3.69 
1  31.  05 
29.16 
22.32 
17.49 
87.21 
60.18 
27.58 
43.97 
43.33 
37.91 
22.90 
48.22 
4.93 
19.74 
18.65 
73.52 
30.32 
36.94 

1 

1 

3.77 
1.72 
.55 
1.00 
1.05 
.38 
1.97 

6.66 
58.06 
99.62 
69.54 
87.96 
99.62 
96.42 

7.50 
54.27 
99.62 
69.68 
96.99 
99.62 
95.05 

+  7.84 
+  4.05 
+  8.42 
+  4  67 

4.70 
5.17 

-  5.3 

.52 

88.24 

85.82 

2.14 

83.74 

68.68 

—  4  32 

4.06 
3.85 
4.62 
4.92 
4.15 
4.94 
4.71 
4.65 
4.20 
3.14 
4.72 
3.651 
3.591 
3.241 
4.057 
3.41 
4.05 
3.09 
3.58 
3.18 

+  2.87 
+10.1 
-  2.3 
+  7.6 
+  4.3 
+  4.3 
+  6.5 
+  0.8 
+  2.9 
+10.6 
+16.1 
+  2.7 
-  4.81 
-  6.81 
+  2.44 
+  0.  21 
-  0.98 
-  8.65 
-  3.5 
-  0.92 

.31 
.35 
.14 
.15 
38 
.18 
.51 
.09 
.34 
.25 
.30 
.84 
1.07 
.96 
.98 
1.14 
.28 
.42 
.83 
.35 

46.77 
36.51 
85.34 
85.01 
59.21 
83.31 
77.00 
79.15 
64.99 
3.72 
67.27 
38.45 
27.60 
13.09 
31.62 
8.74 
41.14 
9.16 
24.76 
1.53 

60.96 
49.22 
82.97 
92.37 
62.38 
93.13 
86.57 
83.31 
65.46 
15.10 
87.10 
37.40 
34.68 
19.98 
60.29 
26.32 
58.80 
13.58 
33.61 
17.21 

1.28 
1.45 
1.57 
.63 
.59 
.75 
2.13 
.37 
1.42 
1  03 

18.67 
9.48 
30.11 
75.43 
76.79 
71.29 
55.82 
61.01 
34.60 

35.02 
24.70 
38.53 
86.83 
64.37 
88.87 
71.81 
65.77 
41.23 

1.23 
3.50 

39.58 
12.98 

74.01 
13.79- 

1.41 
1.31 
1.30 
1.50 
.37 
.55 
1.09 
.47 

33.91 
16.49 
39.17 
11.19 
50.09 
11.74 
30.17 
2.03 

42.36 
25.07 
69s  19 
32.55 
66.96 
16.98 
40.95 
21.43 

408  HISTORY  OF  PRICES  DURING  THE  WAR. 

KEY  TO   COST  CHART  OF  ANTHRACITE   COAL— Continued. 


Ton- 
nage. 

Costs. 

Ad- 
justed 
standard 
per  cent 
sizes. 

General. 

Company. 

Individual. 

Re- 
ported. 

Ad- 
justed. 

Per 
cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

Ter 
cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

Per 
cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

390,540 
180.871 
90,599 
160,034 
52,709 
186,552 
219,333 
92,  918 
184,  978 
97,621 
204,465 
126,562 
157,015 
182,  768 
140,385 
95,808 
178,  191 
134,340 
153,685 
248,  895 
218,  248 
134,502 
93,589 
120,  120 
197,  200 
174,  447 
236,856 
101,304 
273,  180 
141,  801 
138,540 
161,074 
126,417 
63,122 
6,190 
27,  844 
216,696 
37,  140 
74,055 
61,490 
54,941 
170,018 
61,980 
195,  548 
37,  719 
36,092 
60,196 
4,164 
30,585 
98,  443 
108,625 
84,  361 
2,219 
81,  621 
8,284 
41,100 
234,  630 
223,  779 
140,087 
142,  391 
84,  102 
100,  691 
81,865 
175,  310 
124,  792 
61,877 
95,  610 
132,657 
"57,681 
154,  153 
79,014 
79,  168 
128,612 
107,283 
75,272 
78,054 
65.  957 

$2.06 
2.63 
4.55 
3.69 
5.37 
3.52 
3.42 
5.14 
5.04 
4.21 
4.76 
3.95 
3.47 
3.28 
3.80 
4.52 
4.19 
4.02 
4.23 
3.79 
3.70 
3.87 
3.97 
4.13 
4.88 
4.168 
3.384 
5.117 
4.334 
4.407 
4.702 
5.070 
4.573 
4.012 
6.019 
3.095 
4.082 
4.521 
4.916 
4.791 
5.875 
4.046 
3.769 
3.170 
6.184 
5.305 
5.031 
14.499 
4.923 
4.501 
4.037 
5.452 
5.363 
4.088 
3.561 
4.470 
4.400 
3.930 
6.07 
4.24 
5.12 
5.07 
5.35 
3.80 
4.70 
5.78 
7.91 
5.65 
5.51 
3.93 
4.33 
4.73 
5.20 
5.40 
4.52 
3.77 
3.97 

$2.99 
2.89 
4.22 
3.84 
4.59 
3.90 
3.80 
4.78 
5.13 
4.43 
4.38 
4.05 
4.02 
3.67 
3.70 
4.69 
4.33 
4.25 
4.19 
3.86 
4.79 
4.03 
4.45 
4.28 
4.83 
4.213 
4.003 
5.144 
4.412 
4.570 

+  5.62 
-  7.71 
-  7.2 
-  3.26 
-12.9 
+  4.86 
+  3.33 
-  3.91 
-  2.79 
-  0.76 
-  5.2 
+  2.90 
+  6.63 
+  8.24 
-  5.73 
+  1.1 
-  0.92 
-  0.47 
-  0.88 
-  3.71 
-  5.38 
-  0.85 
+  4.51 
-  2.49 
-  3.71 
-  5.  71 
+  8.65 
+  2.56 
+  0.69 
+     .81 
+      50 

1.18 
.55 
.27 
.48 
.16 
.56 
.66 
.28 
.56 
.30 
.62 
.38 
.48 
.55 
.42 
.29 
.54 
.41 
.47 
.75 
.66 
.41 
.28 
.36 
.60 
.53 
.72 
.31 
.83 
.49 

1.18 
4.27 
79.06 
43.24 
96.17 
37.07 
33.64 
91.71 
90.11 
67.57 
83.93 
55.18 
35.74 
25.31 
48.90 
78.79 
66.64 
62.29 
69.09 
47.52 
43.90 
53.05 
57.15 
65.57 
86.24 
66.10 
32.34 
91.18 
74.24 
76.49 

10.72 
7.29 
67.74 
48.12 
81.79 
51.05 
45.12 
88.43 
95.31 
76.65 
73.45 
59.18 
54.66 
39.41 
44.46 
85.21 
71.77 
68.48 
65.12 
48.87 
89.53 
55.07 
78.01 
70.16 
91.08 
66.41 
52.89 
95.62 
75.84 
81.63 

1.56 
.72 

1.56 
5.30 

13.21 
9.59 

1.14 

60.64 

43.25 

.64 
.21 
.74 
.87 
.37 
.74 
.39 
.82 
.50 
.63 
.73 
.56 
.38 
.71 
.54 
.61 
.99 
.87 
.54 
.37 
.48 
.79 
.70 
.94 
.40 
1.09 
.57 

52.70 
97.41 
45.89 
41.82 
92.96 
92.19 
76.51 
88.00 
64.23 
44.59 
30.90 
57.86 
84.97 
75.69 
71.54 
77.81 
56.73 
53.57 
63.20 
66.29 
74.28 
89.20 
74.98 
40.11 
92.59 
81.79 
83.78 

55.09 
87.99 
58.21 
52.55 
91.60 
96.67 
84.28 
81.05 
67.46 
63.09 
46.63 
51.68 
91.11 
79.54 
76.46 
73.13 
56.08 
92.47 
63.66 
85.06 
78.11 
93.26 
74.22 
61.12 
97.07 
83.89 
87.78 

+  2.88 
-     .1 
-     .9 
+     .3 
+23.7 
-  7.2 
+  10.9 
-  0.5 
-  0.9 
+  0.3 
+  12.0 
-  4.4 
-  3.64 
-12.55 
-  8.56 
-  1.60 
-12.47 
-11.0 
+  5.6 
-  0.2 
-  7.63 
+  1.6 
+  10.2 
+  5.7 
+14.9 
+  2.23 
-  5.6 
-11.78 
+  0.55 
+  9.03 
-  6.67 
-  5.40 
+  1.05 
-  1.90 
-  4.62 
-  6.81 
+  5.77 
-  8.38 
-  5.52 
-  6.00 
-  8.02 
-  8.63 
-  8.00 
+  5.6 
+  16.8 
4-9.8 

4.523 
3.863 
5.692 
3.828 
3.630 
4.803 
4.921 
4.659 

.38 
.19 
.02 
.08 
.66 
.11 
.22 
.19 

79.53 
60.15 
98.66 
16.35 
64.65 
78.50 
86.  46 
85.20 

80.90 
49.41 
99.39 
47.11 
36.56 
89.64 
92.59 
83.50 

1.59 
.79 
.08 
.35 
2.72 
.47 
.93 
.77 

68.30 
30.90 
97.31 
2.89 
37.32 
59.50 
78.03 
76.20 

60.95 
25.49 
98.61 
21.05 
10.22 
80.70 
87.76 
66.54 



4.420 
4.008 
3.273 
5.410 
4.851 
4.950 
5.00 
4.381 
4.669 
4.057 
5.036 
5.205 
4.637 
3.901 
4.210 
4.50 
3.71 
5.27 
4.27 
5.59 
4.73 
4.92 
3.84 
4.61 
5.51 
7.06 
5.97 
5.02 
3.81 
4.07 
4.28 
4.75 
4.97 
4.77 
4.40 
4.36 

.51 
.19 
.59 
.11 
.11 
.18 
.01 
.09 
.30 
.33 
.26 
.01 
.25 
.03 
.12 
.71 
.68 
.42 
.43 
.25 
.30 
.25 
.53 
.38 

63.  13 
45.72 
19.89 
99.49 
95.75 
89.55 
89.37 
86.55 
77.83 
62.62 
97.64 
96.01 
64.90 
39.62 
77.12 
76.06 
54.  40 
99.37 
69.42 
90.87 
90.53 
96.00 
48.05 
82.65 

76.35 
53.08 
22.84 
98.34 
91.27 
93.31 
93.64 
73.54 
84.92 
60.62 
94.62 
95.  63 
83.22 
50.49 
65.88 
80.23 
41.30 
96.65 
69.21 
98.98 
87.40 
92.22 
47.64 
82.83 

2.14 

.78 

33.18 
17.39 

52.  55 
27.69 

.78 
.15 
.14 
.24 
.02 
.12 
.39 
.43 
.34 

24.14 
99.66 
97.20 
91.45 
91.21 
89.32 
84.17 
72.75 
98.10 

28.36 
99  30 

93.40 
84.72 
94.74 
81.17 
90.73 
67.89 
95.93 

.03 
1.03 
.10 
.52 
2.95 
2.81 
.76 
.79 
.06 
.27 
.03 
2.20 
1.57 

92.46 
38.35 
13.08 
56.34 
53.  69 
26.83 
97.31 
43.14 
86.91 
85.49 
92.43 
20.87 
68.54 

91.12 
65.40 
25.59 
41.75 
59.34 
16.43 
93.08 
45.04 
98.05 
75.28 
86.20 
23.23 
63.78 

.08 
.47 
.24 
.24 
.33 
.32 
.23 
.24 
.20 

97.72 
53.72 
72.18 
83.13 
93.53 
96.49 
78.39 
45.53 
56.  87 

93.72 
45.  59 
61.  20 
70.40 
87.73 
93.63 
88.  15 
75.01 
72.31 

.35 
2.81 
.99 
1.00 
1.37 
1.35 
.95 
.98 
.83 

96.77 
26.83 
50.62 
70.  54 
89.85 
93.81 
59.03 
14.56 
28.54 

90.57 
20.70 
36.01 
46.04 
76.63 
90.22 
78.40 
50.  41 
49.43 

GOVERNMENT   CONTROL   OVER   PRICES.  409 

KEY   TO   COST   CHART   OF   ANTHRACITE' COAL— Continued. 


Ton- 
nage. 

Costs. 

Ad- 
justed 
standard 
per  cent 
sizes. 

General. 

Company. 

Individual. 

Re- 
ported. 

Ad- 
justed. 

ttfe 

Ad- 
justed 
cum. 

Per 
cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

Per 
cent. 

Re- 
ported 
cum. 

Ad- 
justed 
cum. 

64.  023 
41,316 
238,  729 
25.  565 
91,  747 
19,338 

$4.  62 
4.94 
4.86 
5.16 
4.94 
4.67 

$4.76 
5.13 
4.97 
4.83 
4.31 
4.18 

+  3.2 
+  3.8 
+  6.2 
+  6.0 
-10.9 
-10.6 

.  19       80.  15 
.13       86.96 

87.92 
94.75 

.80 
.52 

63.95 
78.55 

77.45 
91.09 

.08       91.  84 
.  28       S6.  83 
.06       81.91 

91.  16 
71.  23 
64.45 

.32 
1.15 
.24 

88.48 
79.70 
66.66 

84.53 
47.19 
39.81 

-'    |  

It  may  be  repeated  that  the  price-fixing  committee  gave  frank 
recognition  to  the  fact  that  a  determination  to  fix  prices  at  the  "  bulk 
line  *'  would  give  the  lowest-cost  producers  enormously  large  profits. 
They  relied,  however,  upon  the  Government  getting  those  profits 
through  the  operation  of  the  excess-profits  tax.  Chairman  Brookings 
gave  voice  to  the  sentiment  that  it  made  no  especial  difference  to  the 
Government  whether  these  profits  were  held  in  check  by  the  com- 
mittee or  taken  by  tax.  A  considerable  tax  upon  excess  profits  was 
already  being  collected  in  1918,  under  the  revenue  act  of  1917,  upon 
the  incomes  of  1917,  and  one  still  higher  was  in  prospect  for  the 
incomes  of  1918. 1 

(6)  THE  INTERPRETATION  OF  A  "  REASONABLE  PROFIT." 

Once  the  "  bulk  line ''  of  production  had  been  found  and  the  cost 
necessary  to  protect  enough  producers  to  supply  that  amount,  the 
technical  difficulties  of  fixing  any  price  were  over.  There  remained 
then  simply  the  allowance  of  a  "  reasonable  "  margin  for  profit  above 
the  "  bulk-line "  cost  and  the  announcement  of  the  price.  The 
"  bulk  line  "  for  coal,  in  the  Fuel  Administration,  was  located  by  a 
committee  of  technical  experts  who  left,  as  a  matter  of  policy,  the 
determination  of  the  fixed  price  above  the  "  bulk  line  "  to  the  Fuel 
Administrator  in  person.  The  price-fixing  committee,  which  had 
no  such  technical  assistance,  roughly  estimated  their  own  "  bulk 
lines  "  and  fixed  their  own  prices  after  conferences  with  the  industry. 
The  whole  body  of  price-control  boards  at  Washington,  either  care- 
fully or  roughly,  figured  that  the  producer  should  have  a  "  reasonable 
profit,"  though  they  were  not  in  agreement  as  to  what  that  profit 
should  be. 

The  President  in  his  address  to  the  mine  operators  and  manu- 
facturers of  the  United  States,  on  July  12,  1917,  had  said: 

A  just  price  must,  of  course,  be  paid  for  everything  the  Government  buys. 
By  a  just  price  I  mean  a  price  which  will  sustain  the  industries  concerned 


1  See    "Price-Fixing  as    seen   by    a    Price-Fixer,"   by   F.    W.    Taussig   in    the   Quarterly 
Journal  of  Economics,  February,  1919. 


410  HISTOKY   OF   PRICES   DURING  THE   WAR. 

in  a  high  state  of  efficiency,  provide  a  living  for  those  who  conduct  them, 
enable  them  to  pay  good  wages,  and  make  possible  expansions  of  their  enter- 
prises which  will  from  time  to  time  become  necessary  as  the  stupendous  under- 
takings of  the  great  war  develop. 

It  was  left  to  each  board,  however,  to  determine  upon  the  inter- 
pretation of  their  general  principle  and  its  application  to  specific 
controls. 

The  price-fixing  committee  tried  in  a  rough  way  to  measure  the 
prewar  profits  and,  with  that  weapon  in  hand,  they  fought  in  con- 
ference for  the  opportunist  policy  most  favorable  to  the  Govern- 
ment upon  which  they  and  the  industry  could  agree.  They  were 
compelled,  for  want  of  adequate  legal  powers,  to  accomplish  their 
ends  by  resort  to  indirect  methods  and  did  not  have  the  same  relative 
success  with  all  industries.  There  was  not,  therefore,  established  by 
the  price-fixing  committee,  and  given  out  to  the  public  as  their 
formal  policy,  any  resolute  or  general  rule  with  respect  to  what  they 
considered  a  "  reasonable  profit."  It  was,  indeed,  not  possible  for 
them  to  formulate  any  such  general  policy  by  reason  of  various 
complications  within  certain  industries.  It  has  already  been  noted, 
for  example,  that  the  difficulties  of  negotiation  made  finally  man- 
datory the  approval  of  particular  cotton-goods  prices  at  figures  more 
than  25  per  cent  above  cost. 

A  considerable  emphasis  has.  already  been  given  to  the  noteworthy 
work  done  by  the  Food  Administration  with  respect  to  determining 
their  "  reasonable  margin  of  profit."  Mr.  Herbert  Hoover  said  over 
and  again  that  no  person  was  entitled  to  make  more  profit  from  any 
employment  than  he  could  have  made  under  prewar  conditions.  He 
did  not  interpret  this  policy  to  mean,  of  course,  that  no  licensee 
could  charge  more  than  a  prewar  price.  The  administration  of  his 
general  policy  gave  form  to  three  important  aspects  of  rule:  That 
the  "  reasonable  margin  of  profit "  must  be  figured  upon  a  cost  basis, 
the  fixing  of  maximum  margins  of  profit  above  that  basis,  and  the 
disregard  of  replacement  value  in  fixing  margins. 


12.  THE  LIFTING  OF  GOVERNMENT  CONTROL  OVER 

PRICES. 

The  Government  began  lifting  its  war-time  control  over  prices 
immediately  after  the  signing  of  the  armistice,  and  had,  in  fact, 
virtually  restored  prices  to  free  competition  by  the  end  of  1918. 
Some  controls  were  continued  a  short  while  beyond  November  11, 
1918,  at  requests  from  the  industries  to  allow  for  gradual  readjust- 
ment, or  where  it  was  required 
that  particular  transactions  al- 
ready underway  be  completed. 

The  War  Industries  Board 
told  its  commodity  chiefs  after 
the  armistice  was  signed  that  the 
war  was  over,  and  repeatedly 
refused  to  enter  into  new  regu- 
lations. It  closed  its  doors  to 
new  business  officially  on  Decem- 
ber 31,  1918.  The  price-fixing 
committee  refused  numerous  re- 
quests to  continue  price  fixing, 
in  the  main,  and  disbanded  on 
March  1,  1919.  The  Fuel  Ad- 
ministration relinquished  its 
control  over  fuels  and  closed  offi- 
cially all  price  control  on  Janu- 
ary 31,  1919.  The  Food  Ad- 
ministration, though  obliged  to 
continue  certain  controls,  such 
as  wheat  and  sugar,  lifted  most 
of  its  regulations  soon  after  the 
armistice.  The  War  Trade 
Board  continued  its  license  con- 
trol over  exports  and  imports 
somewhat  longer  than  other 
boards  continued  price  control, 
but  closed  its  official  work  on  June  30,  1919,  and  went  into  the 
State  Department  for  liquidation. 

(i)  THE  EFFECT  OF  LIFTING     CONTROL  UPON  PRICES. 

It  is  of  especial  significance,  since  most  of  the  Government  regu- 
lations over  prices  had  been  lifted  by  January  1,  1919,  to  inquire 

411 


"THE  BUREAU  OF  LABOR.  5TAT&TTC5   INDEX  NilMBLR 

ALL  COMMODITES 

SEPARATED    INTO 

CONTROLLED  AND  UNCONTROLLED 

FROM  " 

AUGU5T,19I7TOMAY,1919 

0  9«-.  100). 

—CONTROLLED                        *»  UNCONTROLLED, 

*    ' 

1917     | 

oia 

•| 

1319  | 

,      ,      i       ZAP' 

/S-'x 

_».  p^l-j  ^  200 

\  —  -./ 

r-'Vl 

/ 

160 

»?      ""• 

jf**  ' 

;&o 

—  I  '  KO  '• 

T 

—  .IZO 

100 

60 

- 

\    «w    \ 

'ioia               ."* 

1919  I 

The    Bureau    of    Labor    Statistics    index 
numbers.  —  •'  All      commodities  "      sepa- 
rated into  controlled  and  uncontrolled. — 
By  months,  August,   1017,   to   May,   1919 
(1913=100). 


412  HISTORY   OF   PRICES   DURING   THE   WAR. 

what  then  happened  to  prices.  A  succinct  presentation  of  the  effects 
of  -lifting  control  upon  the  "All  Commodities"  index  number  of  the 
Bureau  of  Labor  Statistics  is  given  here.  There  follows  a  separa- 
tion, extending  from  August,  1917,  when  control  began,  to  May, 
1919,  of  the  series  carried  by  the  Bureau  of  Labor  Statistics  into  con- 
trolled and  uncontrolled  commodities.1  Beginning  with  August, 
1917,  all  commodities  carried  by  the  .Bureau  of  Labor  Statistics 
were  divided  into  two  groups — one  of  commodities  over  which  price 
control  was  exercised  at  some  time  during  the  war,  and  one  of 
those  over  which  no  control  was  exercised.  An  index  number 
for  August,  1917,  was  figured  for  each  series  on  a  1913  base, 
and  subsequently  the  per  cent  of  change  each  month  from  the 
preceding  month  was  found  and  multiplied  by  the  index  number 
for  the  month  used  as  a  base.  Thus,  two  new  index  numbers,  one 
for  controlled  and  one  for  uncontrolled  commodities,  were  made 
from  the  Bureau  of  Labor  Statistics  "All  Commodities  "  index  num- 
ber,, and  by  the  same  method.  The  fact  that  the  Bureau  of  Labor 
Statistics  index  number  in  July,  1917,  was  185,  and  that  the  new  con- 
trolled index  number  for  August  stood  at  191  and  the  uncontrolled 
at  162,  does  not,  of  course,  mean  that  controlled  prices  rose  that 
month  or  that  uncontrolled  prices  fell. 

The  behavior  of  the  index  number  of  controlled  commodities, 
after  control  had  been  lifted  in  January,  1919,  would  seem  to  indi- 
cate that  regulation  had  held  it  in  check.  Once  the  regulations  were 
removed,  and  in  spite  of  the  fact  that  war  pressure  had  ceased,  the 
index  started  upward  and  continued  rising  throughout  the  spring. 
The  index  number  of  uncontrolled  commodities,  which  showed  less 
stability  during  the  war,  underwent  no  such  fluctuation  or  rise  dur- 
ing the  first  half  of  1919  as  characterized  the  controlled  index.  There 
were  so  many  new  influences  tending  to  determine  the  course  of 
prices  after  control  was  lifted  that  no  further  generalization  upon 
the  effectiveness  of  war-time  regulation  can  here  be  made. 

1  The  basis  for  determining  which  commodities  were  controlled  and  which  were  un- 
controlled was  precisely  that  used  in  the  making  of  controlled  and  uncontrolled  indexes 
from  the  price  section  index  number.  It  is  easily  possible,  therefore,  to  check  the  com- 
modities carried  by  the  Bureau  of  Labor  Statistics  against  the  list  of  commodities 
counted  as  controlled  and  uncontrolled  in  the  following  chapter  and  discover  the  separa- 
tion that  is  made  here, 


GOVERNMENT   CONTROL  OVER  PRICES. 


413 


THE  BUREAU  OF  LABOR  STATISTICS  INDEX  NUMBERS  OF  "ALL  COMMODITIES  " 
SEPARATED  INTO  CONTROLLED  AND  UNCONTROLLED  COMMODITIES  FROM 
JANUARY,  1914,  TO  MAY,  1919. 

[1913=100.] 


Uncontrolled  January,  1914,  to  August, 
1917. 

1914 

1915 

1916 

1917 

January 

100 
99 
99 
98 
98 
98 
99 
102 
103 
99 
98 
97 

98 
100 
99 
99 
100 
99 
101 
100 
98 
101 
102 
105 

110 
111 
114 
116 
118 
118 
119 
123 
127 
133 
143 
146 

150 
155 
160 
171 
181 
184 
185 
184 

February 

March                             .                              

April 

May 

June  .. 

July 

August  

September...  .                                        

October 

November 

December  

• 

1917 

1918 

1919 

Con- 
trolled. 

Uncon- 
trolled. 

Con- 
trolled. 

Uncon- 
trolled. 

Con- 
trolled. 

Uncon- 
trolled. 

January    .  .  . 

185 
186 
185 
189 
189 
188 
194 
198 
201 
198 
201 
194 

182 
184 
190 
194 
192 
201 
205 
209 
216 
211 
213 
211 

198 
192 
197 
202 
205 

204 

200 
201 
197 
202 

February 

March 

April... 

May... 

June  .  ... 

July  

August  

191 

189 
182 
183 
181 

162 
158 
168 
173 
176 

September  

October  

November  

December  

(2)  THE  PURPOSE  OF  THE  INDUSTRIAL  CONFERENCE  BOARD. 

Considerable  anxiety  arose  within  the  Government  and  out, 
following  the  lifting  of  war-time  control  over  prices,  lest  prices 
become  unstable  while  readjusting  themselves  to  peace-time  condi- 
tions. The  informal  discussion  held  at  Washington  between  high 
officials  following  the  signing  of  the  armistice  developed  a  belief 
that  the  agreements  relied  upon  during  the  war  to  hold  prices  down 
could  be  modified  to  meet  the  peace-time  situation.  The  Cabinet 
was  called  into  special  meeting  on  February  5,  1919,  and  made  plans 
for  the  creation  of  an  industrial  board. 

The  industrial  board,  under  the  plan  approved  by  the  President, 
was  to  meet  the  representatives  of  industry  and  determine  with  them 
u  fair  prices  "  for  the  basic  raw  materials.  These  prices,  it  was 
thought,  could  be  found  by  a  study  of  cost  and  marketing  data  and 
could  be  agreed  upon  as  during  war  time  without  resort  to  compul- 
sion. The  personnel  of  the  new  board  was  announced  by  the  Secre- 
tary of  Commerce  on  March  10,  1919,  and  its  seven  members  began 
work  immediately. 


414  HISTORY   OF   PRICES   DURING   THE   WAR. 

The  new  board  held  numerous  conferences  during  March  with  rep- 
resentatives of  the  more  important  industries  and  discussed  the  low- 
ering of  prices.  In  several  cases  agreements  were  reached  and  the 
agreed  "  fair  prices  "  announced. 

The  strength  of  the  board  lay  in  part  in  the  hope  that  it  and  offi- 
cials of  the  Government  responsible  for  large  purchases  might  work 
in  absolute  understanding.  But  on  April  1,  1919,  there  arose  a  seri- 
ous difficulty  in  the  refusal  of  the  Railroad  Administration  to  ac- 
cept the  "  agreed  upon  "  prices  set  by  the  board  for  steel  rails.  There 
seemed  no  way  of  reaching  an  agreement  between  the  Railroad 
Administration  and  the  industrial  board.  The  Attorney  General 
announced,  as  his  opinion,  that  the  plan  developed  had  no  legal 
authority.  The  difficulties  of  various  kinds,  aggravated  by  the  lack  of 
statutory  power,  accumulated  and  the  members  of  the  board  resigned 
as  of  May  12,  1919.  The  informal  method  of  fixing  prices  had  not 
proved  as  efficacious  in  peace  time  as  during  war. 


PART  III. 


STATISTICAL    DEVICES    FOR    MEASURING    THE 
EFFECTS  OF  PRICE  CONTROL. 


INTRODUCTION. 

A  study  of  the  extraordinary  heights  to  which  prices  rose  by  August, 
1917,  and  of  the  actions  then  begun  by  the  Government  to  arrest  them, 
prompts  the  inquiry  how  those  actions  affected  prices.  The  search 
for  a  full  answer  leads  into  wide  fields  of  study,  depending  upon  the 
individual  urge,  and  leaves  the  investigator  at  last  with  little  more 
than  opinion.  Men  differ  in  the  objective  points  by  which  they 
judge  whether  price  control  was  effective,  and  seek  nothing  so  much 
as  facts  with  which  to  support  their  own  theories.  This  monograph 
nowhere  ventures  to  establish  or  contest  any  theory  of  Government 
regulation.  It  presents  simply  the  pertinent  facts.  There  have 
been  set  up  in  the  present  chapter  various  statistical  devices  with 
•which  each  person  may  for  himself  measure  the  effects  of  Govern- 
ment price  control. 

It  should  be  understood  at  the  outset  that  no  one  can  hope  ever 
to  measure  precisely  the  effects  of  price  control  upon  the  general 
level  of  prices.  The  better  price  index  numbers  of  commodities  at 
wholesale,  made  from  selected  samples  which  are  weighted  to  allow 
each  commodity  its  proper  influence  upon  the  index,  give  an  accurate 
enough  record  of  the  general  price  level.  They  show  how  wholesale 
prices  actually  moved  during  the  war.  But  it  can  not  be  said,  of 
course,  to  what  further  heights  the  prices  would  have  carried  these 
index  numbers  had  there  been  no  Government  interference.  It  is 
possible  only  to  look  backward  and  analyze  what  did  happen.  The 
most  useful  analysis  for  students  anxious  to  know  the  effects  of  con- 
trol is  had  by  separating  the  controlled  and  uncontrolled  commodi- 
ties in  a  general  index  number  of  prices  and  recomputing  new  in- 
dexes for  each.  The  resulting  devices  make  reliable  measures  of 
past  relative  rises  of  controlled  and  uncontrolled  prices  and  at  least 
suggest  probable  rises  under  free  competition. 

415 


416  HISTORY  OF  PRICES   DURING  THE  WAR. 

There  have  been  made,  and  put  into  this  chapter  for  each  student 
to  use  as  he  will,  the  following  statistical  devices  for  measuring  the 
effects  of  price  control:  A  tabulation  of  the  commodities  controlled 
and  uncontrolled  each  month  showing  the  gradual  extension  of  con- 
trol by  an  arrangement  of  the  series  in  the  Price  Section  index  num- 
ber; index  numbers  of  controlled  and  uncontrolled  prices  for  "all 
commodities/'  the  7  major  groups  and  the  50  subclasses,  running  by 
months  from  1913  to  1918,  and  showing  their  relative  movements 
away  from  prewar  levels;  chain  indexes  of  controlled  and  uncon- 
trolled prices  for  "all  commodities,"  7  major  groups  and  selected 
subclasses,  running  by  months  from  April,  1917,  to  the  end  of  1918, 
and  showing  in  each  month  the  rise  or  fall  from  the  month  preceding; 
the  relative  points  below  which  50  selected  basic  commodities  were 
pegged;  a  comparison  of  controlled  raw-material  prices  with  their 
uncontrolled  manufactures;  a  comparison  of  controlled  prices  of 
manufactured  goods  with  their  uncontrolled  raw  materials ;  a  com- 
parison of  controlled  raw  material  prices  with  their  controlled 
manufactures;  a  comparison  of  controlled  wholesale  prices  with 
corresponding  controlled  retail  prices;  and  finally  a  comparison  of 
war  prices  in  the  United  States,  England,  France,  and  Canada. 

1.  THE  GRADUAL  EXTENSION  OF  PRICE  CONTROL. 

It  is  of  value,  before  attempting  any  measure  of  the  effects  of  price 
control,  to  note  the  extent  to  whicK  the  Government  brought  com- 
modities under  control.  An  analysis  of  the  1,366  typical  commodi- 
ties at  wholesale,  which  are  included  in  the  Price  Section  index 
number,  shows  that  in  September,  1917,  only  3.66  per  cent  of  them 
were  controlled  and  the  remaining  96.34  per  cent  uncontrolled. 
But  by  -the  time  the  armistice  was  signed  the  Government  had 
brought  41.95  per  cent  of  these  commodities  under  price  control, 
while  58.05  per  cent  of  them  were  still  uncontrolled.  The  table 
which  follows  shows  the  commodities  that  were  brought  under  con- 
trol each  month  during  the  war  and  the  rate  at  which  the  list  of 
controlled  commodities  increased  and  that  of  uncontrolled  commodi- 
ties decreased. 


GOVERNMENT  CONTROL  OVER  PRICES. 


417 


"ALL  COMMODITIES." 
(1366  series=100  per  cent.) 


Control  began. 

Commodities. 

Number  of  series. 

Percentage  of  series. 

Con- 
trolled. 

Uncon- 
trolled. 

Con- 
trolled. 

Uncon- 
trolled. 

1917. 
September  

October 

Coal,  coke,  copper,  wheat,  iron  ore,  pig  iron, 
steel  bars,  steel  shapes,  steel  plates 

50 
66 

266 
294 

318 

352 
362 

387 
469 
481 
545 

570 
572 
573 
573 
573 

1316 
1300 

1100 

1072 

1048 

1014 
1004 

979 
897 
885 
821 

7% 
794 
793 
793 
793 

3.66 
4.83 

19.47 
21.54 

23.28 

25.77 
26.50 

28.34 
34.33 
35.22 
60.10 

41.73 
41.87 
41.95 
41.95 
41.95 

96.34 
95.17 

80.53 

78.46 

76.72 

74.23 
73.50 

71.66 
65.67 
64.78 
39.90 

58.27 
58.13 
58.05 
58.05 
58.05 

Steel  blooms  and  billets,  sheet  bars,  wire  rods, 
skelp,  sugar  

November  

December  

1918. 
January  

Steel  sheets,  pipe,  steel  scrap,  tinplate,  lead, 
corn,  oats,  barley,  fresh  fruits  and  vegetables, 
live  stock,  poultry,  fish,  vegetable  oils, 
southern  or  yellow  pine,  ammonia,  smoke- 
less cannon  powder 

Douglas  fir,  wood  chemicals,  Portland  cement, 
remainder  of  iron  and  steel  class  

Nitrate  of  soda,  fertilizers,  except  sulphur  and 
sulphuric  acid  

February  
March 

Zinc,  formaldehyde,  toluol,  arsenic,  animal 
feeds,  coffee  

Aluminum,  binder  twine,  manila  fiber  
Spruce,  hemlock,  nickel,  quicksilver,  silver, 
paper,  caustic  soda,  soda  ash,   bleaching 
powder,  carbon,  tetrachloride  .  .  . 

April  
May 

Wool,  hides  and  skins,  rubber,  platinum, 
manganese,  cotton,  linters,  quebracho  
Sulphuric  and  nitric  acids,  sulphur,  harness 
leather 

Jimp 

July  

Cotton  goods  and  cotton  yarns,  brick,  build- 
ing tile,  sand  and  gravel,  crushed  stone  
Woolen  rags,  glycerin,  sole  and  belting  leather, 
crude  petroleum,  kapoc  

August 

September  
October 

Silk  waste 

Burlap 

November 

December 

The  queries  which  press  most  persistently,  on  one  seeking  to  measure 
effects  of  price  control,  are  whether  the  commodities  that  were 
brought  finally  under  regulation  had  risen  relatively  higher  than 
others,  whether  the  controlled  commodities  afterwards  became  more 
stable  than  the  uncontrolled,  and,  finally,  to  what  heights  prices 
were  allowed  to  rise  before  the  Government  began  regulating  them. 
These  moot  points  can  scarcely  be  settled  in  a  manner  that  will 
permit  of  generalization  upon  the  effects  of  control  as  a  whole,  except 
by  the  construction  of  a  weighted  index  number  for  commodities 
that  came  under  control  some  time  during  the  war  and  another  for 
those  which  did  not.  It  is  true  that  none  of  the  commodities  in 
such  a  controlled  list  would  have  come  under  price  control  before  the 
summer  of  1917,  and  some  of  them  not  until  1918.  But,  if  one 
object  of  the  inquiry  is  to  determine  whether  the  precontrol  rises  of 
commodities  afterwards  controlled  were  more  threatening  than  rises 
of  other  commodities,  this  is  the  proper  method  to  pursue.  The 
index  numbers  presented  here  by  months  from  January,  1913,  to 
December,  1918,  are  not  then  strictly  speaking  for  controlled  and 
uncontrolled  commodities  as  it  is  proposed  to  call  them.  They  are, 
more  specifically,  an  index  number  of  representative  commodities 
which  were  brought  under  price  control  some  time  before  the  signing 
of  the  armistice  and  an  index  number  of  other  commodities  equally 
representative  which  were  not. 
125547°— 20 27 


418 


HISTOKY  OF  PRICES  DURING  THE  WAR. 


2.  THE  PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEP- 
ARATED INTO  CONTROLLED  AND  UNCONTROLLED 
PRICES. 

The  index  number  of  wholesale  prices  made  by  the  Price  Section  of 
the  War  Industries  Board  is,  by  all  odds;  the  most  comprehensive 
and  best  device  for  measuring  war  prices  that  has  been  used  in  this 
country.  This  index  number  contained  prices  for  1 ,366  of  the  most 
important  individual  commodities  that  were  dealt  in  at  wholesale 
during  the  war,  classified  into  7  major  groups  and  50  subclasses. 

These  1,366  commodities,  for  which  the  index  number  contains 
monthly,  quarterly,  and  yearly  prices  from  January,  1913,  to  Decem- 
ber, 1918,  fall  under  one  or  another  of  the  following  7  groups  and  50 
classes : 


I.  Fooi>  GROUP. 

1.  Feed  and  forage. 

2.  Wheat  and  wheat  products. 

3.  Corn  and  corn  products. 

4.  Oats,    rice,    buckwheat,    and    their 

products. 

5.  Barley,  hops,  rye,  and  their  products. 

6.  Sugar  and  related  products. 

7.  Vegetables  and  truck. 

8.  Edible  vegetable  oils. 

9.  Fruits,  nuts,  and  wine. 

10.  Spices  and  condiments. 

11.  Tea,  coffee,  and  cocoa. 

12.  Tobacco  and  tobacco  products. 

13.  Live  stock,  meats,  and  fats. 

14.  Poultry  and  dairy  products. 

15.  Fish  and  oysters. 

II.  CLOTHING  GROUP. 

16.  Cotton  and  cotton  products. 

17.  Wool  and  wool  products. 

18.  Silk  and  silk  products. 

19.  Hides  and  skins  and  their  products. 

20.  Hatters'  fur  and  fur  felt  hats. 

21 .  Hair,  bristles,  and  feathers. 

22.  Buttons. 

III.  RUBBER,  PAPER,  AND  FIBERS 
GROUP. 

23.  Rubber  and  rubber  products. 

24.  Paper. 

25.  Fibers  and  fiber  products. 

IV.  METALS  GROUP. 

26.  Iron,  steel,  and  their  products. 

27.  Ferroalloys,     nonferrous    and     rare 

metals, 


V.  FUELS  GROUP. 

28.  Coal  and  coke. 

29.  Petroleum  and  its  products. 

30.  Matches. 

VI.  BUILDING  MATERIALS  GROUP. 

31.  Clay  produces. 

32.  Sand  and  gravel. 

33.  Quarry  products. 

34.  Cement. 

35.  Glass. 

36.  Lumber. 

37.  Paints  and  varnishes. 

VII.  CHEMICALS  GROUP. 

38.  Mineral  acids. 

39.  Heavy  chemicals. 

40.  Miscellaneous  inorganic  chemicals. 

41.  Fertilizers. 

42.  Soaps  and  glycerin. 

43.  Essential    oils,    flavoring,    and    per- 

fumery materials. 

44.  Wood  distillation  products  and  naval 

stores. 

45.  Natural  dyestuffs  and  tanning  chemi- 

cals. 

46.  Coal-tar  crudes,   intermediates,   and 

dyes. 

47.  Drugs  and  pharmaceuticals. 

48.  Proprietary  preparations. 

49.  Explosives. 

50.  Miscellaneous  organic  chemicals. 


GOVERNMENT  CONTROL  OVER  PRICES.  419 

The  price  series  were,  so  to  speak,  laid  upon  a  table  and  separated 
into  those  which  some  time  came  under  price  control  and  those 
which  did  not.  The  field  of  prices  formally  or  informally  controlled 
by  the  Government  is  infinitely  wider  and  more  indefinite  than  that 
covering  simply  the  prices  fixed.  But  an  adequte  measurement, 
covering  all  price  regulations  undertaken  by  the  Government,  requires 
that  the  broader  interpretation  of  control  be  chosen.  There  was 
involved,  therefore,  considerable  arbitrary  judgment  in  determining 
whether  certain  prices  were  controlled.  The  use  of  the  word  control 
at  any  rate  is  consistent  throughout  this  inquiry  and  it  is  doubtful 
whether  the  few  exceptions  which  may  be  taken  to  the  division 
made  would  materially  affect  the  result.  The  1,366  commodities 
were,  as  indicated,  then  separated  into  573  controlled  and  793  uncon- 
trolled commodities. 

(1)  TABLES   OF    INDEX    NUMBERS   OF    PRICES  OF    CONTROLLED    AND 
UNCONTROLLED  COMMODITIES. 

These  573  series  of  controlled  wholesale  prices  and  the  793  series 
of  those  uncontrolled,  after  classification  under  their  proper  groups 
and  subclasses,  were  weighted  by  multiplying  each  individual  series 
by  the  quantity  of  its  1917  production  plus  imports.  That  operation, 
designed  to  assign  each  commodity  an  influence  upon  the  final  index 
in  proportion  to  its  importance,  gave  12  monthly,  4  quarterly  and  1 
yearly  aggregate  for  each  of  the  1,366  series  for  each  of  the  6  years. 
These  aggregates  were  then  turned  into  relatives  by  allowing  the 
average  prewar  aggregate  (July  1,  1913,  to  June  30,  19i4,)  to  equal 
100.  There  was  thus  made  an  index  number  for  controlled  and 
another  for  uncontrolled  prices  upon  a  prewar  base.  The  slight  dis- 
crepancy between  the  Price  Section  "  all  commodities"  index  number 
listed  here  as  "all,"  and  the  controlled  and  uncontrolled  indexes 
occurs  because  class  weights  were  not  used  in  making  the  latter.1 

It  is  of  especial  significance  that  the  573  series  of  the  "  all  commod- 
ities" index,  which  the  Government  finally  put  under  control,  had 
risen  much  higher  when  control  began  than  the  remaining  793  uncon- 
trolled series.  Indeed,  just  before  the  Government  began  control  of 
them  the  index  of  these  so-called  controlled  series  reached  209,  while 
the  index  for  the  uncontrolled  series  during  the  same  month  was 
only  160.  But  immediately  after  the  beginning  of  control  the  index 
for  the  controlled  series  began  to  drop  until  by  June,  1918,  it  was 
down  to  189.  The  index  of  the  uncontrolled  series,  011  the  other  hand, 
continued  steadily  upward  until  October,  1918,  when  it  reached  201. 
The  controlled  series  likewise  rose  after  June  but  never  again  reached 
the  higher  point  to  which  they  had  climbed  before  control  began. 

1  On  the  use  of  class  weights,  see  War  Industries  Board  Price  Bulletin  No.  1,  "Summary,"  by  Wes- 
ley C.  Mitchell. 


420  HISTORY  OF  PRICES  DURING  THE  WAR. 

The  food  prices  that  came  finally  under  control  during  the  war 
had  risen  to  194  when  price  control  really  set  in,  while  the  uncontrolled 
lot  during  that  month  had  risen  only  to  150.  The  controlled  food 
prices,  which  reached  a  peak  of  200  in  November,  1917,  began 
dropping  as  control  was  extended  until  they  were  as  low  as  179  in 
June,  1918.  They  then  started  upward  again  during  the  latter  half 
of  1918.  The  uncontrolled  food  prices,  while  at  a  lower  level  when 
food  control  set  in,  continued  rising  during  the  whole  time  that  the 
controlled  food  prices  were  falling.  Control  within  the  clothing  group 
began  relatively  late  and  the  behavior  of  the  controlled  and  uncon- 
trolled indexes  is  not  greatly  different.  The  effect  of  the  controlled 
wool  prices  upon  their  uncontrolled  manufactures,  and  that  of  con- 
trolled cotton  manufactures  upon  their  raw  material  are  studies,  of 
course,  which  can  be  made  only  by  use  of  the  class  indexes  for  wool 
and  cotton.  The  effect  of  control  within  the  rubber,  paper,  and  fiber 
group  does  not  show  in  the  controlled  index  until  during  the  latter 
half  of  1918.  There  are  few  groups  in  which  the  effect  of  control  upon 
market  prices  shows  so  immediately  and  clearly  as  in  metals.  The 
index  of  metals  which  the  Government  finally  controlled  reached  an 
extraordinary  peak  of  350  in  July,  1917,  when  talk  of  regulation 
began.  The  other  metals,  which  never  did  come  under  control,  had 
risen  only  to  205  in  that  month.  Metal  prices  started  downward 
before  actual  Government  regulation  began,  and  were  brought  by 
regulation  down  to  212  by  November,  1917.  It  is  noteworthy  that 
the  index  of  controlled  metals  was  held  within  a  few  points  of  that 
stable  level  throughout  the  war.  The  rise  within  the  controlled  fuels, 
following  Government  regulation  of  coal,  would  seem  to  indicate  that 
coal  control  did  not  hold  prices  down.  The  rise,  however,  is  explained 
in  a  large  way  by  increases  which  were  from  time  to  time  allowed  by 
the  Fuel  Administration.  It  is  difficult  to  measure  the  effects  of 
control  within  the  building  materials  group  because  of  the  somewhat 
similar  behavior  of  the  controlled  and  uncontrolled  groups,  and  the 
fact  that  building  materials  prices  were  so  largely  influenced  by  war 
buying.  The  controlled  series  within  the  chemical  group  began  a 
decline  in  April,  1918,  which  continued  throughout  the  year.  They  had 
fallen  from  224  in  April  to  174  by  December.  The  uncontrolled  series 
during  the  same  months  rose  gradually. 


GOVERNMENT   CONTROL  OVER  PRICES. 


421 


8          8 


•»1?I 


422 


HISTORY  OF  PRICES  DURING  THE  WAR. 


!NO£X  NUMBER  OF  PRI 

ELS  GROUP 

S3  AERIES 
OLLED  §  UNCONTROLLE 
DURING  THE  WAR 

GE  ACTUAL  AGGREGATE 
JULY,  131  JTtJUN-!00 
LED  3Z.  •  .....  UN 


§         § 


8          8 


fr. 


Sl 


It9 
OLLED  !>  UNC 
DURING  THE 

E  ACTUAL  AGG 
JULy,l9l3''UUNE 
ED  21  •"—' 


WEICHTED 

BER.B 


i      i 


III! 


GOVERNMENT  CONTROL  OVER  PRICES. 


423 


eighted 
ton  pro 
trolled  d 
gates,  J 
57  series 


424 


HISTORY   OF   PRICES   DURING   THE   WAR. 


lijl 


*-  :s  BJ  as 


GOVERNMENT   CONTROL  OVER  PRICES. 


425 


l      §      § 


t 


§ I 


§ 


P1 


426 


HISTORY   OF   PRICES   DURING  THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED   PRICES,  1913-1915. 

[Base  average  prices  July,  1913,  to  June,  1914=100.] 


All  commodities. 

Food  group. 

Clothing  group. 

Con- 
trolled. 

(573) 

Uncon- 
trolled. 

(793) 

All. 
(1,366) 

Con- 
trolled. 

(214) 

Uncon- 
trolled. 

(54) 

All. 
(268) 

Con- 
trolled. 

(140) 

Uncon- 
trolled. 

(269) 

All. 

(409) 

1913—  Months— 
January 

98 
97 
98 
99 
98 
98 

98 
102 
103 
102 
102 
101 

97 
98 
101 
102 

100 
99 

103 
103 
103 
102 
101 
101 

101 
101 
102 
102 
102 
100 

103 
101 
101 
101 

102 

99 
99 
99 
99 
98 
99 

98 
98 
96 
95 
94 
94 

99 
99 
97 
94 

97 

97 
97 
98 
99 
101 
102 

103 
102 
103 
106 
109 
111 

97 
101 
103 
109 

102 

103 
102 
102 
101 
100 
100 

100 
101 
102 
102 
102 
101 

102 
100 
101 
102 

101 

100 
100 
99 
98 
97 
97 

97 
101 
101 
99 
98 
98 

100 

97 
100 
98 

99 

100 
100 
100 
100 
100 
100 

102 
102 
102 
104 
107 
111 

100 
100 
102 
107 

102 

92 
91 
92 
95 
94 
95 

95 
100 
103 
102 
103 
101 

92 
94 
100 
102 

97 

99 
99 
99 
99 
100 
99 

99 
107 
108 
104 
102 
102 

99 
99 
105 
103 

101 

105 
105 
105 
104 
104 
102 

105 
103 
98 
97 
99 
101 

105 
103 
102 
99 

102 

100 
100 
100 
99 
99 
100 

99 
99 
101 
101 
101 
101 

100 
99 
100 
101 

100 

100 
99 
99 
100 
100 
100 

100 
100 
100 
101 
101 
101 

99 
100 
100 
101 

100 

101 
101 
102 
102 
102 
102 

102 
102 
102 
102 
102 
102 

101 
102 
102 
102 

102 

98 
96 
97 
97 
95 
96 

96 
100 
102 
102 
103 
102 

97 
96 
99 
103 

99 

101 
101 
100 
98 
98 
97 

98 
105 
107 
104 
103 
104 

101 
98 
103 
104 

101 

105 
106 
105 
103 
103 
100 

103 
101 
99 
99 
102 
103 

105 
102 
101 
101 

102 

103 
103 
102 
101 
100 
99 

99 
10f> 
100 
102 
102 
101 

102 
100 
100 
101 

101 

99 
100 
100 
99 
100 
100 

100 
99 
98 
95 
93 
94 

99 
100 
99 
94 

98 

95 
97 
98 
97 
99 
99 

101 
103 
105 
108 
111 
112 

96 
98 
103 
111 

102 

101 
101 
100 
100 
100 
100 

100 
100 
100 
102 
101 
100 

101 
100 
100 
101 

100 

99 
99 
100 
99 
99 
100 

100 
100 
94 
93 
90 
91 

99 
100 
98 
91 

97 

92 
94 
95 
96 
97 
97 

97 
97 
98 
103 
106 
107 

94 
97 
97 
105 

98 

102 

102 
101 
100 
100 
99 

99 
100 
100 
103 
102 
100 

101 
100 
100 
101 

101 

99 
99 
100 
99 
99 
100 

100 
99 
94 
91 
88 
89 

99 
99 
98 
89 

96 

90 
92 
92 
93 
95 
95 

96 
96 
98 
103 
106 
107 

91 
95 
97 
105 

97 

February 

March  

April 

May  .. 

June  

July 

August 

September  

October                

November 

December  

Quarters- 
First 

Second 

Third          

Fourth 

Y"ear. 

1914—  Months- 
January  

February.             .  .  . 

99 
99 
99 
99 

98 

98 
104 
105 
101 
99 
99 

99 
98 
102 
100 

100 

101 
102 
101 
101 
101 
100 

103 
103 
101 
101 
103 
107 

101 
101 
102 
104 

102 

March 

April.  . 

Mav 

June 

July  

August 

September  

October               

November 

December  

Quarters- 
First 

Second  .  . 

Third.... 

Fourth 

Year 

1915—  Months- 
January  

February. 

March 

April    . 

May 

June 

July  

August    .         

September. 

October  

November. 

December 

Quarters  — 
First  

Second 

Third 

Fourth  

Year 

GOVERNMENT   CONTROL   OVER  PRICES. 


427 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED    PRICES,  1916-1918. 

[Base  average  prices  July,  1913,  to  June,  1914=100.] 


All  commodities. 

Food  group. 

Clothing  group. 

Con- 
trolled. 

(573) 

Uncon- 
trolled. 

(793) 

All. 
(1,366) 

Con- 
trolled. 

(214) 

Uncon- 
trolled. 

(54) 

All. 
(268) 

Con- 
trolled. 

(140) 

Uncon- 
trolled. 

(269) 

All. 

(409) 

110 
113 
115 

116 
118 
120 

122 
125 
129 
135 
146 
154 

112 
118 
125 
145 

125 

155 
156 
157 
163 
167 
174 

187 
189 
189 
191 
199 
202 

156 
168 
188 
198 

177 

209 
212 
218 
228 

226 
228 

233 

234 
237 
238 
234 
230 

213 
227 
235 
234 

227 

1916—  Months— 

113 
115 
117 
120 
121 
120 

121 
125 
127 
134 
143 
146 

115 
120 
124 
141 

125 

151 
155 
164 
183 
192 
201 

209 
1204 
205 
198 
200 
193 

157 
194 
206 
196 

188 

195 
198 
197 
196 
192 
189 

195 
199 
204 
201 
200 
204 

197 
192 
199 
201 

197 

116 
119 
121 
123 
123 
124 

124 
124 
125 
127 
131 
135 

119 
123 
124 
131 

124 

140 
142 
142 
146 
149 
152 

160 
162 
163 
167 
172 
174 

141 

149 
162 
171 

156 

178 
180 
182 
187 
189 
191 

194 
195 
199 
201 
200 
197 

180 
189 
196 
199 

•191 

115 
118 
121 
123 
123 
122 

123 
125 
127 
132 
141 
144 

118 
123 
125 
139 

126 

148 
151 
156 
170 
178 
183 

189 
187 
186 
182 
183 
182 

152 

177 
187 
182 

175 

185 
187 
188 
191 
190 
189 

193 
196 
201 
201 
201 
203 

187 
190 
197 
202 

194 

106 
106 
106 
109 
110 
110 

112 
116 
119 
127 
133 
132 

106 
110 
116 
131 

116 

136 

140 
150 
170 
183 
182 

189 
1186 
193 
194 
200 
191 

142 
179 
190 
193 

176 

193 
196 
194 
189 
182 
179 

186 
192 
199 
194 
193 
201 

194 
183 
193 
196 

192 

102 
102 
103 
104 
104 
104 

104 
104 
104 
104 
105 
105 

103 
104 
104 
105 

104 

110 
110 
110 
111 
113 
115 

123 
127 
130 
150 
156 
156 

110 
113 
127 
154 

126 

165 
165 
166 
170 
172 
180 

180 
180 
181 
182 
188 
189 

165 
174 
180 
186 

176 

105 
106 
106 
109 
109 
109 

111 
115 
118 
125 
130 
129 

106 
109 
115 
128 

115 

133 

136 
142 
157 
166 
164 

167 
168 
173 
177 
182 
178 

137 
162 
169 
178 

162 

182 
184 
182 
180 
177 
175 

182 
187 
194 
195 
194 
202 

183 
177 
188 
197 

186 

114 
117 
119 
121 
124 
126 

127 
131 
133 
143 
159 
171 

117 
124 
130 
157 

132 

170 
169 
173 
177 
181 
189 

195 
195 
197 
201 
204 
207 

170 
182 
196 
204 

188 

214 
216 
222 
236 
1240 
244 

247 
249 
241 
242 
241 
238 

217 
240 
245 
240 

236 

111 
113 
116 
117 
118 
120 

123 
125 
128 
131 
139 
145 

113 
118 
125 
139 

124 

151 
153 
153 
158 
162 
168 

181 
186 
185 
186 
195 
198 

152 
163 
184 
193 

173 

205 
207 
210 
216 
214 
215 

221 
221 
230 
231 
227 
223 

207 
215 
224 
227 

218 

Februarv  

March 

April 

Mar      

June  . 

July        

August                  .... 

September 

October  

November  

December 

Quarters  — 
First 

Second   

Third  

Fourth 

Year 

1917—  Months- 
January 

February 

March... 

April 

Mav  

June  

Julv 

August     

September  

October 

November  

December 

Quarters  — 
First 

Second 

Third  

Fourth 

Year  

1918—  Months- 
January  

February 

March..'  

April 

May 

June  

July 

August     

September  

October 

November  

December  

Quarters- 
First 

Second 

Third 

Fourth 

Year  

1  Price  control  began  during  month. 


428 


HISTORY   OF   PRICES   DURING  THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED   PRICES,  1913-1915. 

[Base:  Average  prices,  July,  1913,  to  June,  1914=100.] 


LU  fifeffSrapV80                  Metals  group. 

Fuels  group. 

Con- 
trolled. 

Uncon- 
trolled. 

(98) 

All. 
(119) 

Con- 
trolled. 

(49) 

Uncon- 
trolled. 

(67) 

All. 
(116) 

Con- 
trolled. 

(32) 

Uncon- 
trolled. 

(31) 

All. 
(63) 

1913—  Months- 
January                                144 

108 
108 
108 
103 
103 
103 

103 
103 
103 
103 
103 
99 

108 
103 
103 
102 

104 

98 
98 
97 
98 
98 
97 

97 
98 
98 
97 
97 
97 

98 
98 
97 
97 

97 

97 
85 
85 
85 
85 
86 

86 
86 
85 
86 
86 
87 

89 
85 
86 
86 

87 

114 
113 
112 
107 
105 
105 

104 
104 
103 
102 
101 
99 

113 
106 
103 
101 

106 

98 
98 
98 
99 
98 
97 

96 
101 
100 
98 
98 
100 

98 
98 
99 
99 

98 

100 
00 
90 
90 
90 
90 

91 
90 
89 
90 
92 
95 

93 
90 
90 
93 

91 

120 
118 
117 
115 
114 
111 

111 
110 
108 
105 
99 
96 

118 
113 
110 
100 

110 

95 
98 
97 
96 
94 
92 

92 
93 
94 
91 
89 
89 

97 
94 
93 
90 

93 

90 
91 

92 
94 
96 
99 

102 
105 
110 
113 
119 
132 

91 
96 
106 
121 

104 

118 
113 
111 
110 
109 
108 

105 
105 
107 
106 
103 
100 

114 
109 
106 
103 

108 

99 
98 
96 
95 
94 
92 

90 
100 
92 
87 
87 
90 

98 
93 
94 

88 

93 

95 
108 
119 
124 
145 
164 

172 
147 
147 
145 
159 
163 

108 
145 
155 
156 

141 

120 
118 
116 
114 
113 
111 

110 
110 
108 
105 
100 
96 

118 
113 
109 
100 

110 
96 

96 
92 
93 

91 
94 
93 
91 
80 
89 

97 
94 
93 
89 

93 

91 
93 
95 
98 
101 
106 

110 
110 
114 
116 
124 
136 

93 
102 
111 
125 

108 

100 
99 
99 
98 
98 
98 

99 
101 
102 
102 
102 
102 

99 
9.8 
101 
102 

100 

102 
102 
101 
99 
94 
93 

93 
93 
91 
89 
89 
89 

102 
95 
93 
89 

95 

89 
89 
86 
84 
84 
84 

83 
85 
91 
92 
93 
98 

88 
84 
86 
94 

88 

104 
106 
106 
107 
106 
106 

105 
103 
104 
103 
102 
99 

105 
106 
104 
101 

104 

100 
99 
99 
97 
95 
93 

89 
87 
85 
84 
83 
83 

100 
95 
87 
83 

91 

82 
80 
78 
77 

77 

77 

76 
77 
79 
87 
95 
103 

80 
77 
78 
95 

82 

102 
101 
101 
101 
101 
101 

101 
102 
102 
102 
102 
101 

102 
101 
101 
101 

101 

101 
100 
100 
98 
96 
95 

94 
94 
92 
91 
91 
91 

101 
96 
93 
91 

95 

90 
89 
88 
85 
85 
85 

85 
86 
90 
92 
95 
100 

89 
85 
87 
96 

89 

February  140 

March                                  133 

April...                                125 

May                                   118 

June                                   115 

July                                   109 

August     108 

September                          105 

October  97 

November                            97 

December                            97 

Quarters- 
First               139 

Second                                119 

Third  107 

Fourth                                   97 

Year                                         116 

1914—  Months- 
January  96 

February  98 
March                                   98 

April.                                  101 

May                                   100 

June.                  ..                 93 

July                93 

August                                  110 

September            105 

October                                97 

November  99 

December                          111 

Quarters- 
First  98 

Second                   .             98 

Third  103 

Fourth                                102 

Year                                       100 

1015—  Months— 
January                               111 

February    .                        96 

March    '                                 98 

April                                       97 

May                                      95 

June  98 

July  i          99 

August                                   97 

September  95 

October                               96 

November  i       104 

December.                         117 

Quarters- 
First                                   102 

Second...                            97 

Third                                    97 

Fourth  106 

Year                                          100 

GOVERNMENT  CONTROL  OVER  PRICES. 


429 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED   PRICES,  1916-1918. 

[Base:  Average  prices,  July,  1913,  to  June,  1914=100.] 


Rubber,  paper,  and 
fiber  group. 

Metals  group. 

Fuels  group. 

Con- 
trolled. 

(21) 

Uncon- 
trolled. 

(98) 

All. 
(119) 

Con- 
trolled. 

(49) 

Uncon- 
trolled. 

(67) 

All. 
(116) 

Con- 
trolled. 

(32) 

Uncon- 
trolled. 

(31) 

All. 
(63) 

1916—  Months- 
January          

132 
122 
130 
124 
114 
106 

101 
102 
102 
106 
111 
125 

128 
114 
102 
114 

114 

133 
139 
144 
142 
150 
147 

140 
140 
142 
139 
138 
138 

138 
146 
141 
138 

141 

147 
140 
1144 
149 
156 
155 

156 
155 
153 
146 
143 
139 

143 
153 
155 
143 

149 

93 
96 
99 
103 
105 
106 

107 
109 
111 
113 
116 
119 

96 
104 
109 
116 

107 

127 
129 
130 
135 
136 
136 

135 
135 
142 
142 
141 
140 

129 
136 
137 
141 

136 

142 
144 
144 
150 
157 
160 

159 
160 
161 
161 
161 
160 

143 
156 
160 
161 

155 

103 
104 
109 
112 
112 
111 

112 
114 
117 
120 
123 
129 

106 
112 
114 
124 

114 

138 
141 
143 
146 
148 
147 

144 
143 
149 
147 
146 
145 

141 
147 
145 
146 

145 

148 

148 
150 
155 
162 
165 

164 
166 
166 
165 
163 
162 

149 
161 
165 
163 

160 

141 
148 
164 
168 
166 
165 

165 
169 
172 
177 
202 
220 

1.50 
167 
169 
199 

171 

230 

237 
251 
267 
285 
330 

350 
328 
1295 
234 
212 
211 

239 
296 
325 
219 

270 

212 
212 
212 
211 
212 
212 

214 
215 
215 
217 
217 
212 

212 
212 
215 
216 

213 

186 
203 
201 
212 
209 
197 

185 
181 
181 
187 
196 
202 

197 
206 
182 
195 

195 

199 
205 
210 
205 
206 
205 

205 
198 
192 
188 
190 
186 

205 
206 
199 
188 

199 

181 
179 
183 
181 
189 
190 

197 
207 
206 
205 
201 
200 

181 
187 
203 
202 

193 

147 
154 
168 
174 
171 
169 

167 
170 
172 
176 
202 
218 

155 
171 
171 
199 

174 

226 
234 
247 
260 
276 
315 

333 

313 
283 

228 
209 
208 

235 
286 
310 
215 

262 

208 
209 
209 
208 
209 
210 

212 
214 
214 
216 
216 
211 

209 
209 
213 
214 

211 

105 
106 
109 
114 
114 
114 

113 
107 
105 
109 
119 
123 

107 
114 
108 
117 

111 

131 
136 
134 
173 

182 
184 

178 
M78 
176 
176 
179 
180 

134 
180 
177 
178 

167 

182 

182 
184 
215 
219 
215 

215 

216 
218 
218 
224 
224 

182 
216 
216 
222 

209 

111 
115 

120 
120 
123 
123 

123 
123 
118 
117 
119 
119 

115 
123 
121 
118 

119 

127 
133 
134 
135 
137 
137 

140 
140 
142 
142 
144 
148 

131 
136 
140 
145 

138 

155 
157 
159 
161 
167 
169 

168 
168 
169 
169 
166 
166 

157 
166 
168 
167 

164 

106 
107 
109 
112 
113 
113 

113 
110 
109 
111 

120 
122 

107 
113 
111 
118 

112 

129 
133 
131 
163 
172 
173 

168 
169 
165 
164 
167 
170 

131 
170 

167 
167 

138 

173 
174 
175 

200 
204 
202 

201 
202 
204 
204 
207 
207 

174 
202 
202 
207 

196 

February 

March    ' 

April.   . 

May  . 

June 

July                 .  .   . 

August 

September    

October 

November 

December  

Quarters  — 
First...  

Second 

Third 

Fourth  
Year  

1917—  Months- 
January  

February 

March    ' 

April 

Mav  

June. 

July 

August 

September      

October 

November  

December  

Quarters  — 
First  

Second 

Third 

Fourth  

Year 

1918—  Months- 
January  

February    . 

March 

April... 

May  

June 

July     . 

August  

September  

October 

November 

December  

Quarters- 
First  

Second  .  . 

Third 

Fourth 

Year 

Price  control  began  during  month. 


430 


HISTORY  OF  PRICES  DURING  THE  WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED   PRICES,   1913-1915. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


Building  materials  group. 

Chemicals  group. 

Con- 
trolled. 

(42) 

Uncon- 
trolled. 

(107) 

All. 
(149) 

Con- 
trolled. 

(75) 

Uncon- 
trolled. 

(167) 

All. 
(242) 

1913- 
'Months- 
January 

108 
108 
109 
110 
110 
110 

104 
104 
104 
100 
99 
99 

108 
110 
104 
99 

106 

98 
98 
99 
98 
98 
98 

97 
97 
98 
93 
92 
91 

'98 
98 
97 
92 

96 

90 
91 
91 
91 
92 
92 

93 
93 
93 
104 
106 
106 

91 
92 
93 
105 

95 

100 
101 
101 
101 
101 
101 

101 
101 
102 
101 
100 
100 

101 
101 

101 
100 

101 

100 
100 
100 
99 
99 
99 

99 
99 
99 
98 
98 
97 

100 
99 
99 
98 

99 

96 
96 
96 
96 
96 
97 

100 
99 
99 
101 
100 
101 

96 
96 
100 
101 

98 

104 
104 
105 
105 
105 
105 

102 
102 
103 
100 
100 
100 

104 
105 
103 
100 

103 

99 
99 
99 
99 
98 
98 

98 
98 
98 
96 
95 
94 

99 
98 
98 
95 

98 

93 
93 
93 
93 
94 
94 

96 
95 
95 
101 
101 
102 

93 
94 
95 
102 

96 

102 
102 
103 
103 
103 
102 

102 
102 
101 
100 
100 
100 

102 
103 
102 
100 

102 

99 
99 
99 
99 
99 
98 

98 
99 
101 
99 
98 
98 

99 
99 
99 
98 

99 

98 
99 
99 
107 
108 
108 

125 
129 
141 
152 
163 
173 

98 
107 
132 
163 

125 

103 
103 
103 
102 
102 
102 

102 
101 
102 
100 
101 
101 

103 
102 
102 
100 

102 

99 
99 
100 
99 
98 
99 

98 
99 
107 
108 
111 
109 

99 
99 
101 
109 

102 

135 
141 
142 
147 
144 
154 

158 
158 
163 
166 
171 
174 

139 
148 
159 
170 

154 

103 
104 
104 
103 
103 
102 

102 
101 
101 
100 
100 
101 

103 
103 
102 
100 

102 

99 
99 
100 
99 
98 
99 

98 
99 
106 
105 
106 
105 

99 
99 
101 
105 

101 

123 
126 
126 
133 
132 
137 

146 
148 
155 
162 
172 
178 

125 
134 
149 
171 

145 

February  .  .  . 

March 

April... 

May... 

June  .  . 

July 

August  

September 

October 

November  

Dficp.m  bpr 

Quarters- 
First 

Second  

Third 

Fourth  

Year 

1914— 

Months- 
January 

February.  . 

March 

April... 

May    . 

June 

July 

August.  .  .  .  . 

September 

October  

November        .  . 

Dpp,p,mbpr 

Quarters  — 
First  

Second  . 

Third  

Fourth  

Year  

1915— 
Months- 
January    

February 

March... 

April 

May 

June  

July  ....             

August 

September  

October 

November 

December  .      .          

Quarters- 
First 

Second  

Third 

Fourth 

Year 

GOVERNMENT  CONTROL  OVER  PRICES. 


431 


PRIGS  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED   PRICES,   1916-1918. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


Building  materials  group. 

Chemicals  group. 

Con- 
trolled. 

(42) 

Uncon- 
trolled. 

(107) 

All. 
(149) 

Con- 
trolled. 

(75) 

Uncon- 
trolled. 

(167) 

All. 

(242) 

1916—  Months^ 
January  

113 
114 
115 
113 
114 
114 

111 
111 
111 
119 
120 
121 

114 
114 
111 
119 

115 

129 
130 
131 
157 
158 
159 

164 
164 
164 
165 
U67 
167 

130 
158 
164 
166 

155 

174 
175 
177 
184 
186 
187 

187 
188 
189 
186 
187 
186 

176 
186 
188 
186 

184 

108 
111 
112 
117 
118 
118 

117 
117 
117 
118 
119 
122 

110 
118 
117 
120 

116 

132 
133 
135 
141 
144 
148 

151 
152 
153 
153 
155 
155 

134 
144 
152 
154 

146 

161 
160 
167 
175 

178 
180 

184 
186 
190 
190 
190 
188 

162 

178 
187 
189 

179 

109 
111 
112 
113 
113 
113 

112 
112 
112 
116 
118 
119 

110 
113 
112 
118 

114 

129 
130 
132 
146 
148 
151 

155 
155 
156 
157 
159 
159 

130 
148 
155 
158 

148 

165 
165 
169 
176 
179 
181 

182 
184 
186 
185 
186 
185 

167 
179 
184 
185 

179 

196 
216 
218 
216 
200 
197 

177 
164 
160 
163 
163 
167 

210 

205 
167 
164 

187 

166 
167 
172 
179 
190 
192 

196 
203 
217 
217 
1213 
221 

169 
188 
206 
217 

195 

207 
223 
224 
224 
212 
207 

192 
193 
196 
193 
192 
174 

218 
215 
194 
186 

203 

177 
181 
181 
176 
171 
170 

163 
156 
153 
152 
152 
149 

179 
172 
158 
151 

165 

145 
142 
141 
142 
152 
157 

162 
161 
163 
167 
167 
167 

143 
150 
152 
167 

156 

166 
165 
166 
167 
170 
171 

172 
173 
174 
178 
179 
178 

166 
169 
173 

178 

172 

189 
200 
201 
198 
188 
185 

175 
166 
162 
162 
163 
162 

196 
190 
168 
162 

179 

159 
157 
159 
163 
172 
174 

180 
183 
190 
193 
191 
193 

158 
170 
184 
192 

176 

186 
192 
192 
192 
190 
189 

184 
186 
188 
190 
193 
183 

190 

190 
186 
189 

189 

February 

March 

April  .. 

May 

June 

Julv  ....                     .... 

August 

SeptemlxM'.  .. 

October  

November 

December  

Quarters- 
First  

Second  

Third  . 

Fourth 

Year  

1917—  Months- 
Jan  uarv 

February 

March  

April 

May 

June 

July 

August  

September  . 

October 

November  

December.  . 

Quarters  — 
First  

Second 

Third 

Fourth  

Year  . 

1918-Months— 
January  

February  .  .  . 

March.... 

April 

May 

June  

July  

August  

September 

October 

November  

December 

Quarters  — 
First  

Second  .. 

Third 

Fourth  

Year.. 

Price  control  began  during  month. 


432 


HISTORY   OF  PRICES   DURING  THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED    AND 

UNCONTROLLED  PRICES,  1913-1915. 
[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  food  group. 

Feed 
and 

forage 
class. 

Wheat 
and 
wheat 
prod- 
ucts 
class. 

Corn  and  corn  prod- 
ucts class. 

Oats,     rice,     buck- 
wheat, and  their 
products  class. 

Barley,   hops,   rye, 
and    their    prod- 
ucts class. 

All 
con- 
trolled. 

(22) 

All 
con- 
trolled. 

(12) 

Con- 
trolled. 

(6) 

Un- 
con- 
trolled. 

(3) 

All. 
(9) 

Con- 
trolled. 

(9) 

Un- 
con- 
trolled. 

(1) 

All. 

(10) 

Con- 
trolled. 

(4) 

Un- 
con- 
trolled. 

(4) 

All. 

(8) 

1913—  Months— 
January      .  ... 

83 
80 
80 
86 
90 
92 

89 
102 
105 
104 
104 
101 

81 
90 
100 
103 

93 

95 
95 
95 
101 
106 
102 

98 
108 
109 
104 
101 
100 

95 
103 
105 
102 

101 

108 
109 
110 
111 
110 
109 

113 
108 
95 
88 
92 
95 

109 
110 
106 
92 

104 

105 
104 
102 
104 
104 
104 

99 
98 
100 
99 
100 
100 

104 
104 
99 
99 

101 

101 
101 
101 
101 
102 
99 

96 
110 
116 
115 
117 
120 

101 
101 
107 
118 

107 

135 
146 
150 

148 
148 
127 

128 
121 
111 
115 
114 
124 

143 

141 
120 
118 

130 

70 
72 
75 
82 
84 
90 

91 
108 
110 
103 
105 
100 

73 
85 

105 
103 

91 

92 
91 
95 
99 
102 
104 

104 
118 
116 
107 
100 
94 

93 
102 
114 
101 

102 

104 
108 
105 
110 
110 
108 

114 
118 
111 
93 
93 
97 

106 
109 
114 
94 

106 

99 
99 
99 
99 
99 
99 

99 
99 
100 
100 
100 
100 

99 
99 
99 

100 

99 

99 
99 
100 
100 
100 
100 

100 
100 
100 
102 
102 
102 

99 
100 
100 
102 

100 

102 
101 
101 
101 
102 
103 

103 
103 
103 
103 
103 
104 

101 
102 
103 
103 

102 

79 
80 
82 
87 
89 
92 

93 
105 
107 
102 
104 
100 

81 
89 
103 
102 

94 

94 
94 
97 
99 
102 
103 

103 
113 
111 
106 
100 
97 

95 
102 
110 
101 

102 

103 
106 
104 
107 
108 
106 

111 
114 
109 
96 
96 
99 

104 
107 
110 

97 

105 

92 
92 
93 
94 
96 
97 

103 
105 
101 
105 
103 
100 

92 
96 
103 
102 

98 

97 
97 
97 
96 
97 
100 

99 
110 
116 
108 
102 
109 

97 
97 

108 
106 

102 

113 
120 
122 
121 
119 
115 

116 
106 
99 
99 
101 
102 

118 
118 
108 
101 

111 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
101 
101 
101 
101 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 

101 

92 
92 
93 
95 
96 
97 

103 
105 
101 
104 
103 
100 

92 
96 

103 
102 

98 

97 
97 
97 
96 
97 
100 

99 
110 
116 
108 
102 
108 

97 
97 
108 
106 

102 

113 
120 
122 
121 
119 
115 

115 
106 
99 
99 
101 
102 

118 
118 
107 
101 

111 

100 
98 
95 
96 
99 
98 

94 
104 
114 
107 
103 
99 

98 
97 
105 
103 

101 

101 
98 
95 
94 
95 
95 

89 
105 
121 
115 
122 
124 

98 
95 
105 
120 

105 

138 
150 
141 
139 
141 
135 

135 
129 
105 
109 
115 
121 

143 
138 
123 
115 

129 

98 
98 
99 
99 
99 
100 

100 
ICO 
100 
101 
101 
100 

98 
99 
,    100 
101 

100 

99 
99 
99 
100 
100 
100 

100 
100 
101 
100 
100 
100 

99 
100 
100 
100 

100 

100 
100 
101 
102 
103 
103 

103 
104 
103 
104 
103 
103 

101 
103 
103 
103 

102 

99 
98 
97 
98 
99 
99 

98 
102 
105 
103 
102 
100 

98 
99 
102 
102 

100 

100 
99 
98 
98 
98 
98 

96 
102 
108 
106 
108 
109 

99 
98 
102 
107 

102 

114 
118 
116 
115 
117 
114 

115 
113 
104 
106 
108 
110 

116 
116 
111 

107 

112 

February 

March  

April 

May--- 

June 

July 

August    

September  
October  
November  

December  

Quarters- 
First 

Second     

Third 

Fourth  

ear  .        .... 

1914—  Months- 
January  

February 

March  

April    .  . 

May... 

June 

July  

August. 

September 

October  
November  
December  

Quarters- 
First 

Second  

Third 

Fourth  

Year  

1915—  Months- 
January  
February  
March 

April  

May  

June  

July  

August. 

September 

October  
November  
December  

Quarters- 
First  

Second 

Third  

Fourth... 

Year  

GOVERNMENT    CONTROL   OVER   PRICES. 


433 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED    AND 

UNCONTROLLED  PRICES,  1916-1918. 
[Base:  Average  prices  July,  1913  to  Juno,  1914=100.] 


The  food  group. 

Feed 
and 
forage 
class. 

Wheat 
and 
wheat 
prod- 
ucts 
class. 

Corn  and  corn  prod- 
ucts class. 

Oats,     rice,     buck- 
wheat, and  their 
products  class. 

Barley,   hops,   rye, 
and    their    prod- 
ucts class. 

All 
con- 
trolled. 

(22) 

All 
con- 
trolled. 

(12) 

Con- 
trolled. 

(6) 

Un- 
con- 
trolled. 

(3) 

All. 

(9) 

Con- 
trolled. 

(9) 

Un- 
con- 
trolled. 

(1) 

All. 

(10) 

Con- 
trolled. 

(4) 

Un- 
con- 
trolled. 

(4) 

All. 
(8) 

1916—  Months- 
January       

105 
104 
100 
104 
108 
10G 

103 
108 
110 
-    117 
126 
126 

103 
106 
108 
125 

111 

131 
134 
145 
170 
•191 
193 

218 
197 
214 
212 

i  239 
207 

137 
184 
210 
214 

184 

207 
220 
220 
190 
175 
170 

175 
187 
200 
184 
185 
189 

216 
178 
188 
186 

192 

128 
126 
117 
122 
120 
113 

120 
143 
152 
167 
177 
168 

123 
119 
138 
171 

138 

178 
174 
189 
221 

267 
248 

230 
1232 
215 
211 
209 
203 

181 
247 

226 

208 

216 

202 
205 
202 
209 
206 
207 

215 
213 
212 
211 
211 
214 

203 
208 
213 
212 

209 

110 
108 
106 
111 
110 
106 

117 
125 
126 
140 
144 
134 

108 
109 
123 
140 

123 

145 
147 
165 
218 
241 
252 

299 
302 
301 
293 
1268 
247 

153 
236 
301 

267 

240 

243 
247 
232 
233 
219 
223 

236 
242 
227 
195 
190 
211 

240 
225 
236 
198 

224 

104 
104 
105 
105 
105 
105 

105 
105 
105 
105 

105 
105 

104 
105 
105 

105 

105 

114 
113 
113 
115 
119 
119 

131 
136 
139 
172 
175 
173 

113 
117 
135 
173 

135 

181 

181 

181 
184 
185 
191 

185 
182 
183 
183 
194 
194 

181 
187 
183 
190 

186 

108 
107 
105 
109 
108 
106 

114 
119 
120 
130 
133 
126 

106 
108 
118 
130 

119 

136 
137 
150 
188 
205 
214 

250 
254 
254 
258 
241 
226 

141 

202 
253 
240 

209 

225 
228 
217 

214 

221 
225 
214 
192 
191 
206 

223 
214 
221 
196 

213 

104 
104 
104 
129 
139 
139 

140 
142 
144 
155 
163 
103 

104 
136 
142 

160 

135 

117 
116 
123 
157 
174 
174 

179 
174 
173 
180 

U80 

187 

119 
169 
175 
183 

161 

192 
197 
209 
214 
207 
206 

210 
197 
191 
197 
194 
195 

200 
209 
199 
196 

200 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 

101 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 

101 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 

101 

104 
104 
104 
128 
159 
159 

159 
141 
144 
155 
162 
162 

104 
135 
141 
159 

135 

117 
116 
123 
156 
173 
173 

178 
173 
171 
179 
178 
186 

119 
168 
174 
181 

161 

190 
195 
207 
212 
206 
205 

208 
196 
189 
196 
192 
194 

198 
207 
197 
195 

199 

132 
132 
125 
129 
131 
131 

130 
157 
176 
182 
200 
194 

130 
131 
155 
192 

152 

204 
200 
213 
238 
265 
262 

266 
244 
1235 
235 
228 
253 

206 
254 
248 
240 

237 

260 
308 
358 
327 
283 
228 

217 
217 
210 
202 
200 
199 

310 
278 
214 
200 
251 

103 
104 
105 
105 
105 
106 

106 
106 
106 
106 
106 
105 

104 
105 
106 
106 

105 

105 
104 
104 
104 
104 
105 

109 
110 
112 
124 
132 
134 

104 
104 
110 
130 

112 

154 
154 
153 
158 
160 
171 

175 
176 
177 
178 
178 
179 

154 
163 

176 
178 

168 

113 
114 
112 
114 
115 
115 

115 
124 
131 
133 
140 
137 

113 
115 
123 
137 

122 

141 
139 
143 
152 
162 
162 

166 
159 
157 
164 
167 
177 

141 
159 
161 

170 

158 

192 
210 
227 
219 
205 
192 

190 
191 
189 
187 
186 
186 

210 

205 
190 
186 

198 

March 

\pril 

May        

JUly                       

September  
October  
November    .... 

Quarters- 
First 

Third       

Year      

1917—  Months— 

February  
March          -  -  - 

April     

May            •  -  • 

June        

Julv 

August        -   -   - 

September  

October          .  . 

November  

December 

Quarters- 
First            .  .  . 

Second   

Third  
Fourth   

Year       

1918—  Months- 
January 

February  

March 

April     

May 

June           

July 

\ugust  

September  
October  

November  
December  

Quarters- 
First  

Second 

Third  

Fourth 

Year  

125547°— 20 28 


Price  control  began  during  month. 


434 


HISTORY   OF   PRICES   DURING  THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES,  1913-1915. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  food  group. 

Sugar  and  related  prod- 
ucts class. 

Vege- 
tables 
and 
truck 
class. 

Edible  vegetable  oils 
class. 

Fruits,  nuts,  and  wine 
class. 

Con- 
trolled. 

(9) 

Un- 
con- 
trolled. 

(1) 

All. 
(10) 

All 

con- 
trolled. 

(15) 

Con- 
trolled. 

(13) 

Un- 
con- 
trolled. 

(1) 

All. 
(14) 

Con- 
trolled. 

(10) 

Un- 
con- 
trolled. 

(7) 

All. 
(17) 

1913—  Months- 
January  
February  .  .  . 
March     

105 
100 
101 
99 
99 
99 

105 
110 
109 
103 
104 
99 

102 
99 
108 
102 

103 

96 
97 
91 
90 
96 
100 

100 
151 
161 
136 
116 
115 

95 
95 
137 

122 

112 

117 
131 

136 
136 
138 
139 

138 
133 
123 
118 
132 
138 

128 
138 
132 
129 

132 

103 
103 
103 
103 
103 
107 

107 
107 
107 
107 
107 
107 

103 
104 
107 
107 

105 

107 
95 
85 
87 
91 
95 

95 
99 
99 
99 
99 
99 

96 
91 
97 
99 

96 

99 
95 
95 
95 
95 
95 

95 
99 
99 
99 
99 
99 

96 
95 
97 

99 

97 

105 
100 
101 
99 
99 
99 

105 
110 
109 
103 
104 
99 

102 
99 
108 
102 

103 

96 
97 
91 
90 
96 
100 

99 
150 
160 
136 
115 
115 

95 
95 
137 
122 

112 

117 
131 
135 
136 
138 
139 

138 
133 
123 
117 
132 
138 

128 
138 
131 
129 

131 

84 
86 
85 
85 
84 
90 

88 
102 
104 
102 
97 
98 

85 
86 
98 
99 

92 

98 
100 
101 
102 
104 
104 

113 
115 
104 
93 
83 
81 

100 
103 
111 

85 

100 

84 
86 
86 
^.     88 
91 
91 

89 
92 
84 
81 
89 
91 

86 
90 

88 
87 

8S 

88 
90 
90 
94 
95 
98 

105 
106 
102 
98 
98 
98 

89 
96 
104 
98 

97 

98 
98 
99 
101 
99 
98 

98 
90 

88 
81 
78 
83 

98 
100 
92 
81 

93 

90 
98 
96 
93 
90 
87 

84 
81 
89 
111 
115 
125 

94 
90 
84 
117 

96 

109 
111 
114 
110 
112 
112 

108 
106 
106 
106 
108 
104 

111 
111 
107 
106 

109 

98 
101 
99 
90 

88 

88 

87 
102 
82 
81 
87 
120 

99 
88 
90 
96 

93 

115 
144 
145 
140 
115 
114 

112 
120 
120 
131 
149 
131 

135 
123 
118 
137 

128 

89 
91 
91 
95 
95 
98 

105 
106 
102 
98 
99 
98 

90 
96 
105 
98 

97 

98 
98 
99 
100 
99 
98 

98 
90 
88 
81 
79 
84 

98 
99 
92 

81 

93 

90 
99 
97 
94 
90 
87 

84 
82 
89 
112 
115 
125 

95 
91 
85 
117 

97 

71 
71 

74 
75 
88 
102 

96 
89 
86 
83 
88 
90 

72 
88 
90 

87 

84 

99 
110 
117 
116 
114 
113 

92 

79 
69 
60 
60 
61 

108 
115 
80 
60 

90 

63 
66 
66 
76 
82 
90 

85 
74 
72 
70 
67 
68 

65 
82 
77 
69 

73 

96 
97 
97 
99 
100 
102 

103 
103 
104 
105 
103 
102 

97 
101 
103 
103 

101 

101 
98 
96 
96 
95 
94 

94 
95 
97 
97 
97 
96 

98 
95 
95 
97 

96 

94 
95 
95 
95 
94 
90 

90 
89 

89 
82 
84 
87 

95 
93 
89 

84 

90 

73 
73 
75 
76 
89 
102 

96 
90 
87 
84 
89 
91 

74 

89 
91 

88 

86 

99 
109 
116 
114 
113 
111 

92 
80 
71 
63 
63 
63 

108 
113 

81 
63 

91 

65 
68 
68 
78 
82 
90 

85 
75 
73 
71 
69 
69 

67 
86 
78 
70 

74 

April  
May.   . 

June  
July 

August  ...  . 

September  .  . 
October  
November.  . 
December... 

Quarters- 
First 

Second    . 

Third 

Fourth    . 

Year  .... 

1914—  Months- 
January  
February  .  .  . 
March  

April 

May  

June 

July. 

August  
September  . 
October  
November  . 
December.. 

Quarters- 
First  

Second... 

Third  . 

Fourth  

Year  

1915—  Months- 
January  
February  .  .  . 
March 

April... 

May 

June  

July  
August  
September  . 
October.... 
November  . 
December.  . 

Quarters- 
First  

Second... 
Third  

Fourth  
Year     . 

GOVERNMENT    CONTROL   OVER   PRICES. 


435 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES,  1916-1918. 

[Base:  Average  prices,  July,  1913,  to  June,  1914=100.] 


The  food  group. 

Sugar  and  related  prod- 
ucts class. 

Vege- 
tables 
and 
truck 
class. 

Edible  vegetable  oils 
class. 

Fruits,  nuts,  and  wines 
class. 

Con- 
trolled. 

(9) 

Un- 
con- 
trolled. 

(1) 

All. 
(10) 

All 
con- 
trolled. 

(15) 

Con- 
trolled. 

(13) 

Un- 
con- 
trolled. 

(1) 

All. 
(14) 

Con- 
trolled. 

(10) 

Un- 
con- 
trolled. 

(7) 

All. 

(17) 

191  6-  Months- 
January  
February  .  -  - 
March    ' 

134 
140 
155 
167 
176 
174 

175 
163 
153 
170 
175 
159 

143 
173 
164 
168 

162 

155 
156 
164 
184 
185 
181 

189 
206 
204 
1201 
200 
192 

159 
184 
200 
198 

185 

182 
181 
181 
181 
180 
180 

181 
182 
203 
212 
212 
213 

181 
180 
188 
212 

191 

99 
91 

87 
87 
87 
95 

95 
103 
95 
95 
95 
95 

92 
90 
97 
95 

93 

95 

87 
87 
87 
87 
99 

99 
99 
103 
103 
134 
142 

90 
91 
100 
127 

102 

147 
158 
158 
162 
162 
166 

166 
170 
193 
193 
221 
221 

154 
163 
177 
212 

177 

134 
139 
154 
166 
175 
173 

174 
162 
152 
169 
174 
159 

142 
172 

163 

167 

161 

154 
156 
163 
183 
184 
180 

188 
204 
202 
200 
199 
192 

158 
182 
199 
197 

184 

181 
181 
181 
181 
180 
180 

181 
182 
202 
212 
212 
213 

181 
180 
188 
212 

191 

101 
115 
121 
124 
123 
128 

135 
130 
138 
139 
166 
177 

112 
125 
134 
161 

133 

183 
212 
272 
275 
314 
307 

276 
215 
186 
174 
U82 
178 

222 

299 
226 
178 

232 

184 
188 
186 
169 
159 
150 

165 
201 
207 
196 
181 
171 

186 
159 
191 
183 

180 

129 
132 
141 
147 
149 
146 

138 
151 
145 
163 
181 
180 

134 
147 
145 
175 

150 

175 
175 
183 
199 
209 
211 

199 
199 
208 
233 
1246 
248 

177 
206 
202 
242 

207 

252 
255 
255 
256 
256 
252 

251 
249 
255 
255 
255 
255 

254 
254 
252 
255 
254 

132 
120 
124 
120 
120 
116 

112 
124 
108 
97 
105 
96 

126 
119 
115 
100 

115 

103 
101 
89 
97 
91 
91 

93 

87 
89 
88 
79 
84 

98 
92 
90 
84 

91 

88 
104 
112 
105 
102 
96 

105 
105 
97 
103 
104 
120 

101 
101 
102 

109 

103 

129 
131 
140 
146 
148 
145 

138 
151 
144 
162 
179 
178 

134 
147 

144 
173 

150 

173 
173 
181 
196 
206 
208 

197 

197 
205 
230 
243 
244 

176 
204 
200 
238 

204 

249 
252 
252 
252 
252 
248 
248 
246 
251 
252 
251 
252 

251 
251 

249 
252 

250 

72 
75 
75 
75 

77 
89 

86 
84 
80 
82 
89 
89 

74 
81 
84 
87 

81 

92 
105 
114 
114 
114 
118 

116 
109 
103 
106 
1116 
121 

104 
116 
109 
115 

111 

124 
130 
138 

144 
164 
168 

155 
139 
136 
140 
140 
137 

130 
159 
144 
139 

143 

86 
86 
83 
84 
85 
85 

88 
89 
92 
99 
102 
102 

85 
85 
90 
101 

90 

104 
104 
101 
101 
100 
110 

106 
108 
108 
120 
126 
127 

103 
104 
108 
124 

109 

129 
130 
134 
134 
137 
139 

138 
141 
143 
153 
175 
184 

131 
137 
141 
171 

145 

73 
76 
75 

76 
78 
88 

87 
84 
81 
84 
90 
90 

75 

81 
84 

88 

82 

93 
105 
113 
113 
115 
117 

115 

109 
104 
107 
117 
122 

104 
115 
109 
116 

111 

124 
130 
138 
144 
162 
166 
-154 
139 
136 
141 
143 
140 

130 
158 
144 
142 

143 

April  . 

Mav 

June  

July  
August  
September  .  . 
October  
November.  . 
December... 

Quarters- 
First 

Second 

Third 

Fourth 

Year  

1917—  Months- 
January  
February  .  ..  . 
March 

April 

May 

June  

July 

August  

September.. 
October  
November.  . 
December... 

Quarters- 
First  
Second    

Third 

Fourth  .  .. 

Year  

1918—  Months- 
January  
February  .  .  . 
March 

April 

May  

June  

July., 

August  

September  .  . 
October  
November.  . 
December... 

Quarters- 
First 

Second  
Third  

Fourth  
Year 

Price  control  began  during  month. 


436 


HISTORY    OF   PRICES   DURING   THE    WAR. 


TRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED   AND 
UNCONTROLLED  PRICES,  1913-1915. 

[Base:  Average  prices,  July.  1913,  to  June,  1915=100.] 


The  food  group. 

Spices 
and 
condi- 
ments 
class. 

Tea,  coffee,  and  cocoa 
class. 

Tobac- 
co and 
tobac- 
co prod- 
ucts 
class. 

Live- 
stock, 
meats, 
and 
fats 
class. 

Poul- 
try and 
dairy 
prod- 
ucts 
class. 

Fish  and  oyster  class. 

All 
uncon- 
trolled. 

(10) 

Con- 
trolled. 

(9) 

Un- 
con- 
trolled. 

(11) 

All. 
(20) 

All 
uncon- 
trolled. 

(15) 

All 
con- 
trolled. 

(48) 

All 
con- 
trolled. 

(43) 

Con- 
trolled. 

(14) 

Un- 
con- 
trolled. 

(1) 

All. 
(15) 

1913—  Months- 
January  
February  .  .  . 
March 

103 
103 
101 
101 
102 
101 

99 
100 
99 
100 
100 
100 

102 
101 
100 
100 

101 

100 
101 
101 
101 
99 
99 

99 
110 
109 
106 
105 
105 

101 
100 
106 
105 

103 

107 
112 
115 
116 
114 
114 

115 
114 
114 
117 
123 
124 

111 
114 
115 

121 

116 

129 
123 
115 
110 
109 
101 

96 
96 
98 
108 
106 
101 

122 
107 
97 
105 

107 

99 
102 
98 
98 
96 
101 

98 
102 
92 
80 
81 
80 

100 
98 
97 

80 

94 

82 
85 
83 
85 
83 
79 

80 
80 
76 

77 
81 
82 

83 
82 

79 
80 

81 

103 
104 
106 
103 
104 
104 

103 
101 
102 
102 
102 
101 

104 
103 
102 
102 

103 

99 
99 
98 
98 
99 
98 

98 
107 
103 
100 
101 
111 

99 
98 
103 
104 

101 

103 
120 
120 
119 
115 
113 

119 
121 
118 
119 
126 
121 

117 
116 
120 
122 

119 

124 
120 
113 
109 
108 
102 

97 
97 
98 
107 
106 
101 

119 
106 
97 
105 

107 

99 
102 
98 
98 
97 
100 

98 
103 

94 
84 
84 
86 

100 
98 
98 

84 

95 

86 
91 
89 
91 

89 

85 

87 
87 
83 
84 
89 
88 

89 
88 
86 

87 

87 

103 
103 
99 
97 
97 
98 

99 
99 
101 
102 
102 
102 

101 
97 
100 
102 

100 

100 
100 
99 
99 
99 
99 

99 
100 
100 
100 
100 
100 

100 
99 
100 
100 

99 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 

101 

97 
95 
101 
103 
99 
101 

101 
100 
100 
100 
97 
97 

97 
101 
100 
98 

99 

99 
101 
101 
101 
101 
101 

103 
105 
108 
102 
100 
100 

100 
101 
105 
101 

102 

95 
92 
92 
92 
95 
96 

98 
96 
96 
98 
94 
92 

93 
94 
97 
95 

9r> 

104 
103 
100 
98 
89 
86 

91 
96 
102 
107 
114 
115 

102 
91 
96 
112 

100 

112 
105 
99 
90 

84 

84 

90 
96 
100 
106 
112 
113 

105 
86 
95 
110 

99 

112 
106 
100 
91 

84 
82 

89 
91 
96 
101 
109 
111 

106 
86 
92 
97 

98 

104 
117 
99 
99 
83 
85 

84 
91 
93 
92 
96 
115 

107 
89 
89 
101 

96 

116 
107 
112 
101 
96 
96 

99 
101 
105 
122 
112 
110 

112 
98 
102 
115 

106 

113 
116 
121 
109 
101 
95 

97 
99 
96 
92 
108 
98 

117 
102 
97 
99 

104 

105 
105 
105 
105 
105 
105 

92 
92 
99 
102 
102 
102 

105 
105 
94 
102 

102 

102 
102 
102 
102 
102 
102 

102 
102 
102 
102 
102 
102 

102 
102 
102 
102 

102 

102 
102 
102 
102 
102 
102 

87 
87 
87 
87 
87 
87 

102 
102 

87 
87 

94 

:ios 
in 

102 
102 
95 
96 

88 
91 
96 
97 
99 
108 

106 
98 
92 
102 

99 

109 
104 
107 
102 
99 
69 

101 
101 
103 
112 
107 
106 

107 
100 
102 
108 

104 

107 
109 
111 
105 
102 
99 

92 
92 
91 
89 
97 
92 

109 
102 
92 
93 

99 

April... 

May 

June  
July  ...  . 

AugUSt 

September  .  . 
October  
November.  . 
December.  .  . 

Quarters- 
First 

Second  
Third 

Fourth  
Year  

1914—  Months- 
January  
February  .  .  . 
March  

April  .  .  . 

May 

June  .  .  . 

July  

August  
September.. 
October  
November.  . 
December.  .  . 

Quarters- 
First.-  
Second  
Third  
Fourth  

Year  

1915—  Months- 
January  
February  .  .  . 
March 

April  

Mav 

June  

July  

August  
September  .  . 
October  
November  .  . 
December.  .  . 

Quarters- 
First  

Second  
Third 

Fourth  
Year.. 

GOVERNMENT   CONTROL   OVER  PRICES. 


437 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED   AND 
UNCONTROLLED  PRICES,  1916-1918. 

[Base:  Average  prices,  July,  1913,  to  June,  1914=100.] 


The  food  group. 

Spices 
and 
condi- 
ments 
class. 

Tea,  coffee,  and  cocoa 
class. 

Tobac- 
co and 
tobac- 
co prod- 
ucts 
class. 

Live- 
stock, 
meats, 
and 
fats 
class. 

Poul- 
try and 
dairy 
prod- 
ucts 
class. 

Fish  and  oyster  class. 

All 
uncon- 
trolled. 

(10) 

Con- 
trolled. 

(9) 

Un- 
con- 
trolled. 

(11) 

All. 
(20) 

All 
uncon- 
trolled. 

(15) 

All 
con- 
trolled. 

(48) 

All 
con- 
trolled. 

(43) 

Con- 
trolled. 

(14) 

Un- 
con- 
trolled. 

(1) 

All. 
(15) 

1916—  Months- 
January  
February  .  .  . 
March  
'  April  
May... 

129 
132 
144 
141 
137 
135 

135 
132 
132 
132 
132 
140 

135 
138 
133 
135 

135 

148 
155 
158 
164 
169 
171 

171 
170 
172 
175 

178 
177 

154 
168 
171 

177 

167 

176 
182 
187 
204 
209 
211 

210 
208 
209 
206 
206 
201 

182 
207 
209 
204 

200 

81 
85 
91 
92 
93 
92 

89 
90 
94 
92 
91 
89 

86 
92 
91 
91 

90 

93 
92 

87 
88 
90 
90 

87 
85 
83 
81 
80 
81 

91 
89 
85 
80 

87 

89 
189 

93 
95 
93 
90 

92 
92 
100 
111 

118 
177 

90 
93 
94 
129 

99 

120 
118 
118 
118 
118 
116 

117 
118 
117 
116 
112 
111 

119 
118 

117 
113 

116 

114 
118 
117 
125 
132 
132 

130 
133 
133 
133 
132 
134 

116 
129 
132 
133 

127 

135 
139 
140 
139 
138 
138 

143 
145 
148 
149 
150 
154 

138 
139 
145 
151 

143 

88 
91 
95 
96 
97 
96 

94 
95 
98 
96 
94 
93 

91 
97 
94 

95 

94 

96 
96 
92 
94 
97 
97 

94 
93 
92 
90 
89 
90 

95 
96 
93 

89 

94 

96 
97 
101 
102 
100 
98 

101 
101 
108 
118 
123 
173 

88 
100 
103 
133 

107 

101 
99 
99 
100 
100 
100 

100 
100 
100 
100 
100 
105 

100 
100 
100 
102 

100 

107 
109 
109 
110 
110 
119 

129 
134 
135 
138 
155 
158 

109 
113 
133 
150 

•  125 

154 
156 
161 
167 
171 
185 

195 
200 
202 
203 
203 
200 

157 
175 
199 
202 

183 

94 
97 
104 
106 
109 
114 

114 
113 
116 
114 
114 
116 

98 
109 
114 
114 

109 

120 
127 
138 
150 
156 
156 

152 
156 
169 
U67 
168 
167 

128 
154 
159 
167 

152 

167 
168 
171 
184 
185 
185 

190 

189 
198 
191 
182 
193 

168 
185 
192 
189 

183 

109 
105 
101 
100 
95 
90 

96 
103 
108 
124 
131 
134 

105 
95 
102 
129 

108 

133 
132 
124 
137 
130 
122 

130 
142 
151 
U71 
174 
177 

130 
130 
141 
174 

144 

193 
188 
172 
157 
149 
137 
154 
168 
182 
203 
218 
227 

184 
147 
168 
216 

179 

106 
115 
133 
115 
104 
109 

114 
115 
119 
134 
142 
153 

118 
109 
116 
143 

122 

169 
166 
181 

199 
198 
189 

189 
189 
210 
J221 
235 
224 

172 
195 
196 
227 

198 

247 
239 
229 
220 
218 
225 

226 
231 
233 
251 
260 
264 

239 

222 
230 
258 

237 

88 
82 
95 
102 
102 
97 

100 
100 
100 
100 
100 
100 

88 
100 
100 
100 

97 

105 
105 
105 
105 
105 
105 

109 
109 
126 
126 
126 
126 

105 
105 
114 
126 

113 

126 
126 
126 
126 
146 
146 

146 
146 
146 
156 
160 
174 

126 
139 
146 
163 

144 

97 
97 
113 
108 
103 
103 

107 
107 
109 
116 
120 
125 

102 
105 
108 
120 

109 

135 
134 
141 
150 
150 
145 

147 
147 
166 
171 
178 
172 

137 
148 
153 
174 

153 

183 
180 
175 
171 
180 
184 

184 
186 
188 
201 
207 
217 

179 

178 
186 
208 

188 

June 

July  
August  
September  .  . 
October  
November  .  . 
December.  .  . 

Quarters- 
First 

Second  
Third  
Fourth  

Year. 

1917—  Months- 
January  
February  .  .  . 
March  

April 

May  

June  .  . 

July  

August.  . 

September  .  . 
October  
November.  . 
December.  .  . 

Quarters  — 
First  
Second. 

Third 

Fourth...... 
Year  

1918—  Months- 
January  
February  .  .  . 
March... 

April 

May  

June  
July  

August.  ... 

September.. 
October  
November.. 
December.  .  . 

Quarters  — 
First  
Second  
Third. 

Fourth  
Year  

Price  control  began  during  month. 


138 


HISTORY   OF   PRICES   DURING  THE   WAR. 


I'RIC ".'•:  SECTION  WEIGHTED  INDEX    NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES,  1913-1915. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  clothing  group. 

Cotton  and  cotton 
prod  acts  class. 

Wool  and  woolen 
products  class. 

Silk  and  silk  products 
class. 

Con- 
trolled. 

(57) 

Uncon- 
trolled. 

(24) 

All. 
(81) 

Con- 
trolled. 

(21) 

Uncon- 
trolled. 

(45) 

All. 

(66) 

Con- 
trolled. 

(2) 

Uncon- 
trolled. 

(52) 

All. 

(54) 

1913—  Months- 
January 

103 
103 
103 
102 
101 
100 

99 
100 
100 
102 
102 
102 

103 
101 
100 
102 

101 

100 
100 
99 
99 
99 
99 

99 
97 
94 
89 
85 
84 

100 
99 
97 

88 

95 

83 
84 
85 
87 
89 
89 

91 
92 
94 
99 
102 
104 

84 
89 
93 
102 

92 

100 
98 
97 
97 

95 
95 

95 
95 
97 
110 
107 
100 

98 
96 
96 
105 

99 

96 
98 
103 
98 
100 
102 

102 
102 
72 
64 

52 

56 

99 
100 
92 
57 

87 

54 
61 
61 
67 
75 
71 

71 
67 
70 
92 
95 
93 

59 
71 
69 
93 

73 

102 
101 
101 
100 
99 
98 

98 

98 
99 
105 
104 
101 

101 
99 
98 
103 

100 

98 
99 
101 
98 
99 
100 

100 
99 
86 
79 
72 
73 

99 
99 
95 

i   75 

92 

72 
75 

76 
79 
84 
82 

83 
82 
85 
97 
99 
100 

74 
82 
83 
99 

84 

122 
122 

118 
114 
110 
110 

109 
108 
107 
105 
102 
96 

121 
111 
108 
101 

110 

92 
92 
94 
97 
99 
101 

102 
103 
105 
106 
111 
114 

92 
99 
103 
110 

101 

122 
133 
138 
136 

136 
136 

139 
143 
145 
146 
149 
153 

131 
136 
143 
149 

140 

106 
106 
106 
106 
105 
105 

104 
103 
102 
102 
101 
99 

106 
105 
103 
101 

104 

98 
98 
98 

98 
98 

93 

99 
100 
100 
100 
101 
101 

98 
98 
100 
101 

99 

103 
101 
107 
107 
107 
108 

109 
111 
112 
113 
115 
116 

105 
107 
111 
114 

109 

108 
108 
108 
107 
106 
105 

105 
103 
103 
102 
101 
99 

108 
106 
104 
101 

105 

97 
97 
98 
97 

98 
99 

99 
1QO 
100 
101 
102 
103 

98 
98 
100 
102 

99 

105 
107 
110 
110 
111 
111 

112 
114 
116 
116 
118 
120 

108 
111 
114 

118 

113 

91 
90 
89 
91 
91 
91 

97 
96 
103 
98 
98 
99 

90 
91 
98 
98 

94 

101 
102 
103 
103 
102 
99 

103 
99 
91 

88 
82 
86 

102 
101 
98 

85 

96 

85 
85 
84 

84 

84 
85 

84 
85 
88 
89 
88 
95 

85 
84 
85 
91 

86 

96 
100 
96 
95 
95 
97 

96 
100 
101 
100 
99 
99 

97 

95 
99 
100 

98 

100 
101 
100 
100 
100 
103 

100 
96 
94 
93 
90 
91 

100 
101 
96 
91 

97 

92 
92 
92 
93 
92 
91 

91 
92 
93 
97 
103 
107 

92 
92 
92 
102 

95 

96 
100 
96 
95 
95 
96 

'        96 
100 
101 
100 
99 
99 

97 
95 
99 
100 

98 

100 
101 
100 
100 
100 
103 

100 
96 
94 
93 
90 
91 

100 
101 
96 
91 

97 

92 
92 
92 
92 
92 
91 

91 
92 
93 
97 
103 
107 

92 
92 
91 
102 

94 

February  

March 

April  

May 

June  

July 

August 

September..  

October 

November  

December 

Quarters- 
First 

Second 

Third 

Fourth 

Year  .  , 

1914—  Months- 
January  

February.  .  . 

March  

Aprl 

May  

Junte  .. 

July 

August  

September 

October  

November 

December  

Quarters- 
First    

Second 

Third'  . 

Fourth 

Year 

1915—  Months- 
January  

February 

March.  .  

April 

May 

June 

July 

August  

September.  . 

October  

November. 

December  .  „  

Quarters- 
First    ...  . 

Second 

Third. 

Fourth 

Year 

GOVERNMENT   CONTROL  OVER  PRICES. 


439 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES,  1916-1918. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  clothing  group. 

Cotton  and  cotton 
products  class. 

Wool  and  woolen 
products  class. 

Silk  and  silk  products 
class. 

Con- 
trolled. 

(57) 

Uncon- 
trolled. 

(24) 

All. 
(81) 

Con- 
trolled. 

(21) 

Uncon 
trolled. 

(45) 

All. 
(66) 

Con- 
trolled. 

(2) 

Uncon- 
trolled. 

(52) 

All. 
(54) 

1916—  Months- 
January  

106 
109 
110 
112 
114 
116 

119 
124 
128 
140 
153 
160 

108 
114 
124 
151 

124 

158 
157 
161 
169 
172 
184 

193 
194 
200 
206 
206 
211 

159 
175 
196 
208 

184 

225 

233 
246 
268 
1270 
275 

279 
283 
269 
270 
270 
267 

235 
271 
277 
269 

263 

94 
95 
91 
95 
95 
100 

103 
104 
120 
128 

148 
161 

93 
97 
109 
145 

111 

141 
138 
131 
148 
156 
167 

203 

200 
192 
192 
224 
228 

136 

157 
198 
215 

176 

238 
244 
248 
261 
234 
225 

235 
229 
264 
261 
240 
227 

243 
240 
243 
243 

242 

101 
103 
103 
105 
107 
110 

112 
116 
125 
135 
151 
160 

102 
107 
118 
149 

119 

151 
150 

149 
161 
166 

177 

197 
196 
197 
200 
213 
218 

150 
168 
197 
210 

181 

230 
237 
247 
265 
256 
256 

262 
262 
267 
267 
258 
251 

238 
259 
264 
259 

255 

157 
161 
161 
160 
161 
162 

163 
164 
166 
169 
179 
187 

160 
161 
164 

178 

166 

194 
203 
215 
217 
230 
255 

268 
273 
273 
283 
285 
286 

202 
234 
272 

285 

248 

288 
286 
290 
289 
1288 
290 

298 
297 

299 
299 

298 
287 

288 
289 
298 
294 

292 

121 
125 
128 
130 
132 
133 

136 
138 
141 
142 
147 
155 

125 
131 
138 
148 

136 

164 
170 
175 
182 
188 
197 

206 
218 
223 
227 
237 
244 

170 
189 
216 
236 

202 

248 
252 
259 
266 
270 
272 

279 
281 
285 
289 
285 
281 

253 

269 
282 
285 

272 

125 
129 
132 
133 
135 
136 

139 
141 
144 
145 
151 
158 

129 
135 
141 
152 

139 

167 
174 
179 
186 
193 
203 

213 
225 
228 
234 
243 
248 

173 
194 
222 
242 

208 

253 
256 
262 
268 
272 
274 

281 
283 
286 
290 
286 
282 

257 
272 
283 
286 

274 

95 
92 
101 
103 
109 
111 

111 
120 
124 
124 
123 
121 

96 
107 
118 
122 

111 

119 
110 
112 
113 
115 
137 

164 
173 
161 
152 
142 
152 

114 
122 
166 
149 

138 

152 
157 
163 
185 
202 
221 

235 

245 
*250 
235 
224 
220 

157 

203 
244 
226 

208 

109 
116 
122 
121 
120 
121 

122 
128 
125 
128 
134 
134 

116 
121 
125 
132 

124 

132 
135 
134 
136 
136 
141 

147 
153 
151 
145 
147 
147 

133 
138 
150 
147 

142 

150 
151 
153 
159 
162 
171 

172 
174 
179 
181 
184 
181 

151 
164 
175 
182 

16S 

109 
115 
122 
121 
120 
121 

122 
128 
125 
128 
134 
134 

116 
121 
125 
132 

123 

132 
134 
133 
136 
136 
141 

147 
153 
151 
146 
147 
147 

133 
138 
150 
147 

142 

150 
151 
153 
159 
162 
171 

172 
175 
180 
181 
184 
182 

151 
164 
176 
182 

168 

February 

March 

\pril 

May... 

June  .            .... 

July  

\ugust  . 

September  

October 

November 

December 

Quarters  — 
First...  

Second  

Third 

Fourth  

Year  

1917—  Months- 
January  

February 

March  

April  .  .  . 

May 

June 

Julv 

August  

September 

October. 

November  

Deeeml>er 

Quarters- 
First 

Second  ...     . 

Third  . 

Fourth  

Year  

1918—  Months- 
January  .  . 

February 

March  .  .  . 

April.. 

May  

Junf>... 

July  

August  

September... 

October 

Novem)>er.  . 

December 

Quarters- 
First..  . 

Second  

Third.... 

Fourth  

Year  

Price  control  began  during  month. 


•140 


HISTOKY   OF  PRICES   DURING  THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES,  1913-1915. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  clothing  group. 


I  Hatters' 

Hides  and  skins  and  their     j  fur  class 

products  class.  |  and  fur 

i  felt  hats. 


Con- 
trolled. 

(60) 


Uncon- 
trolled. 

(96) 


All. 
(156) 


All  un- 
controlled 

(10) 


Hair, 
bristles, 

and 
feathers 

class. 


All  un- 
controlled 

(22) 


1913— Months- 
January 97 

February 97 

March 96 

April 95 

May 95 

June 95 

July 95 

August 97 

September 98 

October 101 

November 101 

December 100 

Quarters- 
First 97 

Second 95 

Third 97 

Fourth 100 

Year 97 

1914— Months- 
January 99 

February 102 

March 102 

April 102 

May 102 

June 102 

July 101 

August 102 

September 104 

October 103 

November 105 

December 109 

Quarters- 
First  101 

Second 102 

Third 102 

Fourth 105 

Year— 103 

1915— Months- 
January 112 

February 113 

March 112 

April 105 

May 107 

June 108 

July 112 

August 115 

September 115 

October 116 

November 117 

December 118 

Quarters- 
First  112 

Second 107 

Third 114 

Fourth 117 

Year...  113 


'J'j 


99 
100 
100 
100 
100 


100 
99 


100 
100 
100 
101 
100 
100 

101 
101 
101 
101 
101 
102 


100 
100 
101 
W2 

101 


104 
104 
104 
104 
104 
lOi 

105 
105 
105 
105 
106 
306 


104 
104 
105 
106 

105 


98 


99 
99 
100 
100 
100 


97 
99 
100 

99 


ICO 
101 
101 
101 
101 
101 

10! 
101 
102 
102 
102 
105 


101 
101 
101 
103 

101 


107 
107 
107 
104 
105 
106 

107 
109 
109 
109 
110 

no 


107 
105 
108 
110 

108 


105 
105 
105 
105 
105 
105 

104 
104 
103 
103 
101 
99 


105 
105 
104 
101 

104 


98 


98 

97 

97 
100 
100 
99 
98 


98 


97 


101 
101 
101 
101 
101 
100 

100 
IOC 
99 
99 
99 
99 


101 
101 
100 
99 

100 


101 
101 
101 
101 
100 
100 

100 
100 
100 
104 
103 
101 


101 
100 
100 
103 

101 


100 
100 
100 

99 
98 
98 


100 
100 


100 
98 


GOVERNMENT    CONTROL   OVER   PRICES. 


441 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 

UNCONTROLLED  PRICES,  1916-1918. 
[Base:  Average  prices  July,  1913,  to  June,  1916=100.] 


The  clothing  group. 


Hides  and  skins  and  their 
products  class. 


Con- 
trolled. 

(60) 


Uncon- 
trolled. 

(96) 


All. 
(156) 


All  un- 
controlled 

(10) 


Hatters' 
fur  class 
and  fur 
felt  hats. 


Hair, 
bristles, 

and 
feathers 

class. 


All  un- 
controlled 

(22) 


1916— Months- 
January 117 

February 12: 

March 125 

Apnl 130 

May 134 

June 137 

July 135 

August 135 

September 134 

October 143 

November 165 

December 189 

Quarters — 

First 122 

Second 134 

Third 135 

Fourth 166 

Year 139 

1917— Months- 
January 

February 184 

March. . .' 185 

April 182 

Mav 186 

June 182 

July 180 

August 176 

September 168 

October 168 

November 175 

December 177 

Quarters- 
First  186 

Second 183 

Third 175 

Fourth 173 

Year 179 

1918— Months- 
January 170 

February 160 

March 153 

April 156 

May '166 

June--- 

July 

August 164 

September 165 

October 166 

November 166 

December 165 

Quarters- 
First 161 

Second 163 

Third 165 

Fourth 166 

Year...  164 


113 
113 
115 
116 
118 
119 

123 
122 
123 
125 
132 
136 


114 
118 


131 
121 


159 
158 

158 
158 

157 
158 

168 
If>S 
167 
167 
168 
168 


158 

158 
168 


163 

176 
175 
175 
175 

177 
178 

183 
183 
183 
183 
185 
185 

175 
177 
183 
184 

180 


114 
116 
118 
120 
123 
125 

127 
127 
127 
131 
143 
154 


116 
123 
127 
143 

127 


169 

167 
1(>7 
166 
107 
166 

172 
171 
lfif> 
168 
170 
171 


168 
166 
170 
170 

168 

174 
170 
168 
168 
173 
175 

177 
177 
177 
177 

178 
178 

171 

172 
177 
178 

174 


101 
104 
107 
114 

107 


121 
125 
130 
130 
131 
131 

132 
132 
135 
136 
155 


125 
131 
133 

150 

135 


164 
179 
177 
183 
189 
192 

218 
219 
221 
221 
221 
220 

173 

188 
219 
221 

200 


100 
99 
101 
103 
104 


100 
100 


103 
100 


106 

106 
107 
107 

106 


110 
112 
114 
113 
112 
115 


10C> 
108 
112 
113 

110 


121 
121 
125 
131 
131 
131 

137 
146 
145 
147 
147 
146 

122 
131 
143 
147 

136 


Price  control  began  during  month. 


442 


HISTORY   OF   PRICES   DURING   THE    WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED   PRICES  1913-1915. 

[Base:  Average  prices,  July,  1913,  to  June,  1915=100.] 


The  rubber,  paper,  and  fibers  group. 

Rubber  and  rubber 
products  class. 

Paper  class. 

Fibers  and  fiber 
products  class. 

Con- 
trolled. 

(10) 

Uncon- 
trolled. 

(24) 

All. 
(34) 

Con- 
trolled. 

(1) 

Uncon- 
trolled. 

(40) 

AIL 

(41) 

Con- 
trolled. 

(10) 

Uncon- 
trolled. 

(34) 

All. 
(44) 

1913—  Months- 
January  

169 
161 
149 
138 
127 
123 

113 
111 
104 
92 
93 
% 

160 
129 
109 
94 

123 

95 
100 
99 
104 
102 
91 

92 
115 
106 
% 
104 
125 

98 
99 
104 
108 

102 

126 
98 
100 
98 
93 
97 

99 
95 
92 
94 
107 
127 

•  108 
96 
95 

109 

102 

111 
111 
111 

104 
103 
104 

104 
104 
104 
104 
104 
98 

111 

104 
104 
102 

105 

97 
97 
97 
97 
97 
97 

97 
97 
96 
96 
96 
96 

97 
97 
97 
96 

97 

96 
80 
79 
79 
80 
SO 

80 
79 
29 
80 
80 
80 

85 
80 
79 
80 

81 

123 
122 
119 
111 

108 
108 

106 
105 
104 
102 
102 
98 

121 
109 
105 
100 

109 

97 
97 
97 
98 
98 
96 

96 
100 
98 
96 
97 
102 

97 
97 
98 
99 

98 

102 
84 
83 
83 
82 
83 

84 
83 
82 
83 
85 
90 

90 

83 
83 
86 

85 

101 
101 
101 
100 
101 
100 

101 
101 
100 
100 
100 
99 

101 
100 
100 
100 

100 

101 
100 
100 
100 
100 
99 

100 
99 
100 
100 
102 
102 

100 
100 
100 
101 

100 

100 
99 
99 
99 
99 
99 

99 
99 
99 
99 
99 
99 

99 
99 
99 
99 

99 

101 
98 
101 
101 
101 
100 

100 
100 
100 
100 
100 
100 

100 
101 
100 
100 

100 

100 
100 
100 
100 
99 
99 

99 
100 
100 
104 
102 
102 

100 
99 
100 
103 

100 

101 
100 
100 
99 
100 
100 

100 
100 
100 
100 
100 
101 

100 
100 
100 
100 

100 

101 
99 
101 
101 
101 
100 

100 
101 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
99 

99 
100 
100 
103 
102 
102 

100 
99 
100 
102 

100 

100 
100 
100 
99 
99 
100 

100 
100 
100 
99 
99 
100 

100 
99 
100 
100 

100 

116 
116 
116 
113 
108 
105 

105 
109 
111 
108 
103 
99 

116 
108 
109 
103 

109 

94 
9-- 
95 

94 
95 
94 

92 
106 
106 
98 
86 
80 

94 
94 
103 

87 

94 

82 
86 
89 
93 
97 
100 

99 
98 
97 
98 
101 
107 

86 
97 
98 
102 

96 

97 
97 
98 
99 
99 
99 

101 
101 
102 
102 
102 
102 

97 
99 
101 
102 

100 

100 
98 
97 
99 
101 
98 

95 
102 
103 
97 
94 
92 

98 
99 
100 
94 

98 

96 
96 
101 
106 
102 
106 

•  108 
108 
108 
108 
111 
111 

98 
105 
108 
110 

105 

105 
105 
105 
105 
103 
101 

102 
104 
106 
104 
102 
100 

105 
103 
104 
102 

104 

97 
96 
96 
97 
98 
96 

93 
104 
104 
97 
91 
87 

97 
97 
101 
91 

96 

90 
92 
96 
101 
100 
103 

101 
10} 
103 
104 
107 
110 

93 
102 
104 
107 

101 

February 

March        

April 

May 

June 

July 

August               

September 

October 

November 

December              

Quarters- 
First       

Second 

Third     

Fourth 

Year 

1914—  Months- 
January  

February 

March              

April 

May 

June  

July  

August 

September  

October 

November  

December 

Quarters- 
First             

Second 

Third        

Fourth 

Year 

1915—  Months—    . 
January      

February 

March            

April 

May 

June 

July       

August 

September  
October 

November  

December 

Quarters- 
First       

Second                   

Third 

Fourth 

Year 

GOVERNMENT   CONTROL   OVER   PRICES. 


443 


TRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED   PRICES   1916-1918. 

[Base:  Average  prices,  July,  1913,  to  June,  1916=100.] 


The  rubber,  paper,  and  fibers  group. 

Rubber  and  rubber 
products  class. 

Paper  class. 

Fibers  and  fiber 
products  class. 

Con- 
trolled. 

(10) 

Uncon- 
trolled. 

(24) 

All. 
(34) 

Con- 
trolled. 

a)  ; 

Uncon- 
trolled. 

(40) 

All. 
(41) 

Con- 
trolled. 

(10) 

Uncon- 
trolled. 

(34) 

All. 
(44) 

1916—  Months— 
January            

146 
127 
140 
131 
116 
101 

92 
92 
93 
97 
104 
119 

138 
116 
92 
107 

113 

121 
125 
132 
127 
129 
118 

104 
103 
105 
100 
95 
88 

126 
124 
104 
94 

112 

96 
S3 

38 
93 
198 
.98 

98 
98 
98 
98 
96 
96 

97 

98 

97 
95 

87 
87 
87 
88 
88 
88 

89 
89 
89 
90 
92 
93 

87 
88 
89 
92 

89. 

102 
102 
103 
108 
109 
110 

110 
111 
119 
121 
121 
121 

102 
109 
113 
121 

111 

123 
125 
125 
131 
139 
140 

140 
141 
141 
141 
141 
141 

125 
137 
140 
111 

136 

99 
95 
98 
97 
94 
91 

89 
90 
90 
92 
95 
98 

97 
94 
90 
95 

94 

106 
107- 
109 
112 
113 
112 

109 
109 
116 
1L7 
115 
114  : 

107 
112 
111 
115 

112 

117 

117 
118 
123 
131 
%   131 

131 
132 
132 
132 
131 
131 

117 
128 
131 
131 

127 

100 
99 
99 
101 
102 
104 

108 
112 

115  : 
118 
116  i 
126; 

99 
102 
111 
120 

108: 

149  ^ 
162 
169 
168 
168 
168  '• 

166 
166 
170 
166 
164  : 
161 

160 

168: 

168 
164 

165 

170 
169 
170 
U73 
191 
191 

195 
195 
195 
196 
196 
196 

170 
185 
195 
196 

187 

108 
116 
131 
147 
153- 
158 

162 
169 

1.78 
187 
194 
202 

118 
153 
169 
194 

159 

208 
209 

208 
208 
202 
196 

186 
182 
187. 
175 
171 
166 

209 
202 
185 
170 

192 

165 
168 
170 
177 
181 
194 

191 
195 
198 
199 
.199 
199 

168 
184 
195 
199 

186 

106 
112 
122 
134 
139 
143 

147 
153 
160 
168 
173 
181 

113 
139 
153 
174 

145 

192 
196 
197 
197 
192 
188 

195 
177 
183 
172 
169 
165 

195 
192 
180 
169 

184 

166 

168 
170 
176 
184 
193 

192 
194 
197 
199 
199 
198 

168 
184 
195 
198 

187 

121 

128 
129 
126 
119 

118 

117 
119 
118 
121 
127 
141 

127 
121 
118 
129 

124 

151 
155 
155 
163 

194 
209 

215 
217 
219 
222 
235 
258 

154 
188 
217 
238 

199 

266 
270 
1272 
280 
281 
280 

281 
275 
266 
.233 
224 
206 

270 
280 
274 
221 

261 

116 
132 
138 
139 
143 
145 

150 
153 
153 
156 
156 
169 

129 
142 
152 
161 

146 

180 
189 
192 
207 
216 
224 

230 
230 
231 
239 
241 
240 

187 
215 
231 
240 

218 

239 
238 
238 
240 
244 
247 

243 
244 
244 
245 
244 
232 

238 
244 
244 
240 

241 

118 
131 
134 
133 
133 
134 

137 
139 
139 
142 
144 
158 

128 
133 
138 
148 

137 

168 
175 
177 
189 
206 
218 

224 
225 
226 
232 
239 
248 

173 
204 
225 
239 

210 

250 
251 
252 
256 
260 
261 

259 
256 
253 
240 
236 
221 

251 
259 
256 
232 

249 

February 

March        

\pril 

May  
June 

July                       .  . 

\uaust 

September  
October  

November...  . 

December 

Quarters- 
First  

Second 

Third  

Fourth  

Year.  

1917—  Months- 
January  . 

February 

March 

April  

May       ..... 

June 

July 

August  

September     . 

October  

November. 

December  

Quarters- 
First  

Second 

Third  

Fourth 

Year     

1918—  Months- 
January 

February  

March 

April  

May 

June 

July 

August 

September  .. 

October  

November. 

December 

Quarters- 
First 

Second  

Third 

Fourth 

Year  

1  Price  control  began  during  month. 


444 


HISTORY   OF    PRICES    DURING    THE    WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER,  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES,  1913-1915. 

[Base:  Average  prices,  July.  1913.  to  June,  1914=100.] 


The  metals  group. 


Iron,  steel,  and  their  products 

class. 


Con- 
trolled. 

(36) 


Uncon- 
trolled. 

(52) 


All. 

(88) 


Ferroalloys,  nonferrous,  and 
rare  metals  class. 


Con- 
trolled. 

(13) 


Uncon- 
trolled. 

(15) 


1913— Months- 
January 121 

February 121 

March 120 

April 117 

May...  115 

June 113 

July 112 

August Ill 

September 108 

October 104 

November 98 

December 96 

Quarters- 
First 121 

Second 115 

Third 110 

Fourth .' 99 

Year Ill 

1914— Months- 
January 95 

February 98 

March..! 98 

April 96 

May 93 

June 92 

July ; 92 

August 93 

September 95 

October 92 

November 90 

December 89 

Quarters- 
First  97 

Second 94 

Third ! 93 

Fourth 90 

Year 93 

1915— Months- 
January 89 

February 90 

March 90 

April 91 

May 91 

June 93 

July 97 

August 103 

September. . . 108 

October Ill 

November 117 

December 131 

Quarters- 
First 90 

Second 92 

Third 103 

Fourth 120 

Year...  101 


99 

99 

99 

100 

100 

100 

100 
100 
100 
100 
101 
100 


99 
100 
100 
100 

100 


100 
100 
100 
99 
99 
99 

99 
99 
99 
99 
99 
99 


100 
99 
99 
99 

99 


97 
97 
98 
100 
100 
100 


98 
97 
97 
100 

98 


121 
120 
119 
116 
115 
113 

112 
111 
108 
104 
98 
96 


120 
114 
110 

99 

111 


89 
90 
90 
91 
92 
93 

97 
103 
108 
111 
117 
131 


90 
92 
103 
119 

101 


111 
105 
102 
105 
106 
102 

101 
106 
109 
108 
103 
98 


106 
104 
105 
103 

104 


94 
100 
102 
112 
119 
131 

127 
119 
122 
122 
129 
138 


98 
121 
122 
130 

118 


121 
115 

112 
111 
111 
109 

106 
106 
108 
106 
104 
100 


116 
110 
107 
103 

109 


99 
98 
96 
94 
93 
91 

89 
100 
91 
84 
86 
89 


95 
110 
123 
129 
153 
175 

185 
155 
155 
152 
169 
174 


109 
152 
165 
165 

148 


GOVERNMENT    CONTROL   OVER   PRICES. 


445 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER,  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED   PRICES,  1916-1918. 

[Base:  Average  prices,  July,  1913,  to  June,  1914  =  100.] 


The  metals  group. 

Iron,  steel,  and-their  products 

class. 

Ferroalloys,  nonferrous,  and 
rare  metals  class. 

Con- 
trolled. 

(36) 

Uncon- 
trolled. 

(52) 

All. 
(88) 

Con- 
trolled. 

(13) 

Uncon- 
trolled. 

(15) 

All. 

(28) 

1916—  Months- 
January                    

139 
143 
161 
165 
162 
163 

165 
169 
171 
176 
203 
222 

146 
163 
168 
200 

169 

237 
241 
257 
276 
297 
348 

374 
349 
1313 
244 
219 
218 

244 
310 
346 
227 

282 

218 
219 
219 
218 
218 
218 

218 
220 
220 
222 

223 
217 

219 
218 
219 
221 

219 

105 
106 
105 
113 
119 
119 

120 
120 
120 
129 
130 
136 

106 
117 
120 
132 

119 

142 
142 
145 
149 
155 
160 

170 
175 
189 
185 
185 
185 

143 
154 
178 
185 

165 

186 
187 
184 
186 
186 
191 

194 
194 
194 
199 
201 
205 

185 
188 
194 
202 

192 

138 
143 
160 
164 
161 
162 

164 
168 
170 
175 
202 
221 

145 
162 

167 
198 

168 

235 

238 
254 
274 
294 
344 

370 
346 
310 
243 
218 
217 

242 
306 
342 
226 

279 

218 
218 
218 
217 
217 
218 

218 
219 
219 
222 
222 
217 

218 
217 
219 
220 

218 

156 
173 
178 
187 
190 
177 

167 
174 
180 
182 
198 
207 

169 
185 
174 
196 

181 

193 
217 
223 
211 
222 
227 

212 
205 
i  197 
176 
171 
172 

211 
220 
205 
173 

202 

175 
174 
173 
174 
175 
177 

188 
189 
189 
189 
189 
183 

174 
175 

188 
187 

181 

200 
219 
217 
228 
224 
210 

195 
191 
192 
197 
207 
213 

212 
221 
192 
206 

208 

208 
215 
221 
215 
217 
213 

211 
201 
192 
189 
191 
186 

215 
214 
202 
188 

205 

181 
178 
183 
180 
189 
190 

197 
209 
208 
206 
201 
199 

181 
187 
205 
202 

194 

175 
192 
194 
205 
205 
191 

179 
181 
185 
188 
202 
209 

187 
200 
182 
200 

192 

200 
217 
222 
213 
219 
221 

212 

203 
195 
181 
180 
178 

213 
218 
203 
180 

203 

177 
176 
177 
177 
181 
183 

192 
197 
197 
196 
194 
190 

177 
180 
195 
193 

187 

February 

March 

April                            

May 

June     .             

July                  

August                          

September 

October                   

November                          

December  

Quarters  — 
First                           

Second                                        .... 

Third 

Fourth                               

Year                  ,    

1917—  Months- 
January                               

February          

March                                 

April 

May 

June                                       

July                                  

August 

September        

October                             

November 

Quarters  — 
First                                             

Second 

Third                          

Fourth 

Year 

1918—  Months- 
January 

February              

March                                         

April 

May 

June                                       .  . 

July 

August 

September                 

October 

November  

December                   

Quarters- 
First                                        .  ..  . 

Second 

Third....                 

Fourth 

Year  

Price  control  began  during  month. 


446 


HISTORY   OF   PRICES   DURING  THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
••/.  UNCONTROLLED  PRICES,  1913-1915. 

[Base:  Average  prices  July,  1913,  to  June,  191-4=100.] 


The  fuels  group. 

Coal  and 
coke  class 

Petroleum  and  petroleum 
products  class. 

Matches 
class. 

All  con- 
trolled. 

(27) 

Con- 
trolled. 

(5) 

Uncon- 
trolled. 

(22) 

All. 

(27) 

All-uncon- 
trolled. 

(9) 

1913—  Months— 
January                                                 

104 
101 
100 
99 
99 
100 

100 
101 
101 
102 
102 
101 

102 
99 
101 
101 

101 

100 
100 
100 
98 
98 
98 

98 
99 
99 
99 
99 
99 

100 
98 
99 
99 

99 

99 
99 
98 
95 
95 
95 

95 
95 
96 
% 
97 
99 

99 
95 
95 

98 

97 

87 
93 
96 
95 
96 
96 

98 
102 
104 
104 
105 
105 

92 
95 
101 
104 

98 

105 
108 
106 
101 

82 
80 

79 
78 
70 
64 
63 
63 

106 
88 
76 
63 

83 

63 
63 
55 
54 
54 
54 

52 
58 
75 
79 
81 
97 

60 
54 
62 
86 

Go 

104 
106 
106 
107 
106 
106 

105 
103 
104 
103 
102 
99 

105 
106 
104 
101 

104 

100 
99 
99 
97 
95 
93 

89 
87 
85 
83 
S3 
83 

9-3 
95 

87 
83 

91 

81 
80 

77 

•     77 
77 
77 

76 
77 
79 
86 
95 
103 

79 

77 
77 
95 

£2 

99 
102 
103 
104 
103 
103 

103 
103 
103 
103 
103 
101 

102 
103 
103 
102 

102 

101 
102 
101 
98 
92 
89 

86 
84 
81 

78 
77 

77 

102 
93 

84 

77 

89 

76 
75 
71 
70 
70 
70 

69 
71 

78 
84 
91 
101 

74 
70 
73 
92 

77 

99 
99 
99 
99 
99 
99 

99 
99 
99 
100 
100 
100 

99 
99 
99 

100 

103 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 
101 
101 

101 
101 
101 
101 

101 

101 
101 
101 
105 
105 
105 

105 
105 
106 
106 
106 
106 

101 
105 
105 
106 

104 

March                                                  

April 

Mav 

June                       -  

July                        

August                                          

October                               .                .  . 

December  .  .                                        

Quarters— 
First 

Second 

Third 

Fourth,                                                           .... 

1914—  Months- 
January  ....               ..     ..         

February 

March                                  .          

April 

Mav 

June 

July 

August                                                

September 

October                                               

November 

December  .  .                                     ............ 

Quarters- 
First 

Second                                 .                  

Third  

Fourth                                               

Year                                                             

1915—  Months- 
January  ...                

February 

March  .                          

April 

May                                      

June 

July 

August. 

September 

October  .  .                                          

November 

December  ...    .              .  .              

Quarters- 
First 

Second  

Third 

Fourth..                              .   .               ...... 

Year  .                                  .1 

GOVERNMENT    CONTROL   OVER   PRICES. 


447 


TRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES,  1916-1918. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  fuels  group. 

Coal  and 
coke  class. 

Petroleum  and  petroleum 
products  class. 

Matches 
class. 

All  con- 
trolled. 

(27) 

Con- 
trolled. 

(5) 

Uncon- 
trolled. 

(22) 

All. 

(27) 

All  uncon- 
trolled. 

(9) 

191C—  Months— 
January  . 

102 
100 
99 
103 
103 
103 

103 
104 
106 
110 
123 
122 

100 
103 
104 
118 

106 

127 
127 
124 
177 
189 
189 

180 
U81 
170 
169 
174 
175 

126 
185 
177 
173 

165 

177 
177 
178 
215 
218 
213 

212 
213 

215 
215 
223 
223 

177 
215 
214 
220 

207 

114 
122 
136 
142 
144 
144 

142 
115 

104 
106 
108 
125 

124 
143 
120 
113 

125 

142 
163 
163 
163 
164 
168 

172 
172 
193 
193 
193 
193 

156 

165 
178 
193 

173 

195 
196 
200 
215 
223 
223 

223 
1223 
227 
227 

227 
227 

197 
220 
224 
227 

217 

111 
115 
120 
120 
123 
123 

123 
123 
118 
117 
118 
119 

115 
123 
121 
118 

119 

126 
132 
133 
135 
136 
137 

139 
139 
141 
142 
143 
148 

130 
136 
140 
145 

138 

155 

157 
159 
161 
167 
169 

168 
168 
169 
169 
166 
166 

157 

166 
168 
167 

164 

112 
117 
125 
127 
130 
130 

128 
120 
114 
114 
115 
121 

118 
129 
121 
117 

121 

131 
141 
142 
143 

144 
146 

149 
149 
157 
157 
158 
161 

138 
145 
151 
159 

148 

167 
169 
171 
177 
183 
185 

'184 
184 

186 
186 
184 
184 

169 
182 
185 
185 

180 

121 
121 
121 
121 
121 
122 

123 
124 
124 
127 
137 
148 

121 
121 
124 

137 

126 

.163 
164 
164 
164 
164 
164 

165 
165 
165 
1£6 

167 
168 

164 
165 
165 
167 

165 

1C8 
1C8 
169 
1C9 
169 
170 

171 
172 
173 
173 
173 
174 

168 
169 
172 
174 

171 

February 

March.... 

April  .  . 

May  

June.. 

July. 

August 

September  

October...  . 

November  

December  

Quarters- 
First.. 

Second  

Third  

Fourth  

Year  

1917—  Months- 
January  

February  

March  

April  

May  

June  

July  

August  

September  

October  

November  

December  

Quarters  — 
First  

Second  

Third  

Fourth  

Year  

1918—  Months- 
January  

February.  .  .  ;  

March  

April.. 

May  

June  

July  

August  ...   . 

September  

October  

November  

December  

Quarters- 
First  

Second  

Third.... 

Fourth  .  . 

Year  

Price  control  began  during  month. 


•148 


HISTORY   OF   PRICES   DURING    THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES  1913-1915. 

[Base:  Average  prices  July,  1913  to  June,  1914=100.] 


The  building  materials  group. 

Clay  products  class. 

Sand  and  gravel  class. 

Quarry 
prod- 
ucts 
class. 

Cement  class. 

Con- 
trolled. 

(3) 

Uncon- 
trolled. 

(13) 

All. 
(16) 

Con- 
trolled. 

(8) 

Uncon- 
trolled. 

(1) 

All. 
(9) 

All 

uncon- 
trolled. 

(15) 

Con- 
trolled. 

(6) 

Uncon- 
trolled. 

(1) 

All. 

(7) 

1913—  Months- 
January  
February  .  .  . 
March  
April  

99 
100 
100 
100 
100 
101 

101 
101 
101 
100 
100 
100 

100 
100 
101 

100 

100 

101 
100 
100 
99 
99 
99 

98 
98 
99 
98 
99 
98 

100 
99 

99 
99 

99 

96 
96 
97 

87 
87 
97 

97 
97 
97 
97 
100 
100 

97 
97 
97 
99 

97 

97 
97 
98 
100 
100 
100 

100 
100 
100 
100 
98 
98 

97 
100 
100 

99 

99 

100 
100 
100 
100 
100 
101 

101 
102 
102 
102 
101 
101 

100 
100 
102 
101 

101 

101 
101 
101 
102 
102 
102 

102 
102 
102 
102 
101 
103 

101 
102 
102 
102 

102 

98 
98 
99 
100 
100 
100 

100 
100 
100 
100 
99 
99 

98 
100 
100 
99 

100 

100 
100 
100 
100 
100 
100 

101 
101 
101 
101 
100 
100 

100 
100 
101 
100 

100 

99 
99 
100 
100 
100 
100 

101 
101 
100 
100 
100 
102 

100 
100 
101 
101 

100 

98 
99 
98 
98 
99 
98 

99 
98 
99 
99 
99 
100 

98 
98 
99 
99 

99 

100 
101 
102 
101 
101 
100 

100 
99 
100 
99 
100 
101 

101 
101 

99 
100 

100 

105 
108 
101 
103 
102 
100 

100 
96 
97 
99 
100 
105 

105 
102 
97 
102 

102 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

98 
99 
98 
98 
99 
98 

99 
98 
99 
99 
99 
100 

99 
99 
99 
99 

99 

100 
101 
102 
101 
101 
100 

100 
99 
100 
99 
100 
101 

101 
101 
99 
100 

100 

105 
108 
101 
103 
102 
100 

100 
96 
97 
99 
100 
105 

105 
102 

98 
102 

102 

98 
98 
100 
100 
100 
100 

101 
101 
101 
101 
101 
101 

98 
100 
101 
101 

100 

101 
101 
101 

98 
98 
98 

98 
-    98 
97 
96 
96 
% 

101 

98 
98 
96 

98 

97 
97 
97 
97 
97 
97 

97 
97 
97 
97 
97 
97 

97 
97 
97 
97 

97 

91 
94 
99 
103 
104 
103 

104 
104 
105 
105 
102 
100 

95 
103 
104 
102 

101 

96 
95 
99 
99 

97 
97 

97 
99 
99 

98 
96 

87 

97 
97 
98 
94 

96 

85 
88 
86 
85 
86 
87 

91 
92 
93 
94 
97 
96 

86 
86 
92 
96 

90 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

91 
94 
99 
102 
104 
103 

104 
104 
105 
105 
102 
100 

95 
103 
104 
102 

101 

96 
95 
99 
99 

97 

97 

97 
99 
99 

98 
96 

87 

97 
97 
98 
94 

96 

85 
88 
86 
85 
86 
87 

91 
92 
93 
94 
97 
96 

86 
86 
92 
9G 

90 

May  
June  

July  

August  

September.  . 
October  
November.  . 
December... 

Quarters- 
First 

Second  

Third 

Fourth 

Year  

1914—  Months- 
January  
February.  .. 
March..:.... 
April  

Mav 

June  

July  

August  
September.. 
October  
November.  . 
December.  .  . 

Quarters- 
First  
Second 

Third  
Fourth 

Year  

1915—  Months- 
January  
February.  .. 
March  

April 

May  ....... 

June 

July 

August  
September.. 
October  
November.  . 
December.  .  . 

Quarters- 
First 

Second  
Third  
Fourth  

Year  

GOVERNMENT   CONTROL   OVER  PRICES. 


449 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES  1916-1918. 

[Base:  Average  prices  July,  1913  to  June,  1916=100.] 


The  building  materials  group. 

Clay  products  class. 

Sand  and  gravel  class. 

Quarry 
prod- 
ucts 
class. 

Cement  class. 

Con- 
trolled. 

(3) 

Uncon- 
trolled. 

(13) 

All. 
(16) 

Con- 
trolled. 

(8) 

Uncon- 
trolled. 

(1) 

All. 
(9) 

All 
uncon- 
trolled. 

(15) 

Con- 
trolled. 

.(6) 

Uncon- 
trolled. 

(1) 

All. 

(?) 

1916—  Months- 
January  
February  .  .  . 
March  
April.. 

107 
109 
112 
112 
113 
114 

117 
118 
119 
123 
125 
127 

109 
113 
118 
125 

117 

130 
134 
136 
138 
142 
146 

150 
151 
152 
152 
154 
155 

134 
142 
151 
153 

145 

156 
163 
163 
164 
172 
177 

U88 
197 
203 
201 
201 
205 

161 
171 
196 
203 

183 

107 
107 
105 
105 
109 
109 

110 
114 
114 
116 
118 
125 

106 
107 
113 
120 

112 

133 
136 
141 
146 
152 
158 

159 
163 
163 
163 
163 
164 

137 
152 
162 
163 

153 

174 
174 
179 
184 
195 
201 

201 
206 
211 
211 
210 
200 

176 
193 
206 
207 

196 

107 
108 
107 
107 
110 
110 

112 
115 
115 
118 
120 
126 

107 
109 
114 
121 

113 

132 
136 
140 
143 
149 
154 

157 
159 
160 
160 
160 
161 

136 
149 
159 
160 

151 

169 
171 
174 

178 
188 
194 

197 
203 
208 
208 
209 
201 

171 
187 
203 
206 

192 

110 
110 

109 
109 
108 
110 

110 
110 
110 
109 
112 
115 

110 
109 
110 
112 

110 

126 
126 
117 
123 
128 
128 

131 
134 
133 
131 
155 
159 

123 
126 
133 
148 

132 

183 
181 
173 
172 
177 
185 

U82 
185 
184 
1% 
199 
197 

179 
178 
184 
197 

184 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

121 
121 
121 
121 
121 
121 

121 
121 
121 
121 
121 
121 

121 
121 
121 
121  • 

121 

136 
136 
136 
136 
136 
136 

136 

136 
136 
136 
136 
136 

136 
136 
136 
136 

136 

109 
109 
109 
109 
108 
110 

110 
109 
109 
108 
111 
114 

109 
109 
109 
111 

110 

126 
126 
117 
123 
127 
128 

131 
134 
132 
131 
153 
157 

123 
126 
132 
146 

132 

181 
178 
171 
170 
175 
183 

179 
183 
181 
192 
195 
194 

177 
176 
181 
194 

182 

99 
103 
103 
105 
105 
108 

108 
108 
108 
110 
110 
113 

102 
106 
108 
111 

107 

120 
120 
120 
120 
129 
133 

134 
134 
134 
143 
144 
144 

120 
127 
134 
144 

131 

148 
148 
148 
161 
166 
172 

172 
173 
173 
173 
192 
192 

148 
167 
173 

186  1 

•  i 

168 

101 
104 
110 
112 
115 
115 

113 
114 
114 
115 
117 
120 

105 
114 
114 
117 

112 

125 
132 
138 
146 
147 
151 

151 
151 
151 
152 
152 
U49 

132 
148 
151 
151 

146 

151 
152 
167 
167 
172 
172 

171 
174 
173 
172 
176 
173 

157 
171 
172 
174 

169 

120 
120 
120 
120 
120 
120 

120 
120 
120 
120 
120 
120 

120 
120 
120 
120 

120 

130 

130 
130 
130 
130 
130 

130 
130 
130 
130 
130 
130 

130 
130 
130 
130 

130 

170 
170 
170 
170 
170 
170 

170 
170 
170 
170 
170 
170 

170 
170 
170 
170 

170 

101 
104 
110 
112 
115 
115 

113 
114 
114 
115 
117 
120 

105 
114 
114 
117 

112 

125 
132 
138 
146 
147 
151 

151 
151 
151 
152 
152 
149 

132 
148 
151 
151 

146 

151 
153 
167 
167 
172 
172 

171 
174 
173 
172 
176 
173 

157 
171 
172 
174 

169 

May 

June  

July........ 
August  

September.  . 
October  
November.  . 
December.  .  . 

Quarters- 
First  
Second 

Third  
Fourth 

Year  

1917—  Months- 
January  
February  .  .  . 
March  . 

April... 

May  

June 

July  . 

August  

September.. 
October  
November.  . 
December... 

Quarters- 
First 

Second... 

Third 

Fourth  

Year 

1918—  Months- 
January  
February  .  .  . 
March    . 

April... 

May  ... 

June 

July  

August 

September.  . 
October  
November.  . 
December.  .  . 

Quarters- 
First........ 

Second  
Third 

Fourth  
Year 

125547°— 20 29 


Price  control  began  during  month. 


450 


HISTORY  OF  PRICES   DURING   THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES  1913-1915. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  building  materials  group. 

Glass 
class. 

Lumber  class. 

Paints  and  varnishes  class. 

All 
uncon- 
trolled. 

(10) 

Con- 
trolled. 

(24) 

Uncon- 
trolled. 

(38) 

All. 

(62) 

Con- 
trolled. 

(1) 

Uncon- 
trolled. 

.    (29) 

All. 
(30) 

1913-Months— 
January 

102 

102 
102 
102 
102 
102 

102 
102 
102 
101 
101 
101 

102 
102 
102 
101 

102 

99 
99 
99 
99 
99 
99 

99 
99 
99 
99 
99 
99 

99 
99 
99 
99 

99 

91 
90 
90 
90 
90 
90 

90 
90 
90 
90 
95 
91 

90 
90 
90 
91 

90 

115 
115 
115 
115 
115 
115 

105 
105 
105 
99 
99 
99 

115 
115 
105 
99 

108 

98 
98 
98 
98 
98 
98 

97 
97 
97 
90 
90 
90 

98 
98 
97 
90 

96 

90 
90 
90 
91 
91 
91 

92 
92 
92 
109 
109 
109 

90 
91 
92 
109 

96 

103 
103 
103 
103 
103 
103 

102 
102 
102 
101 
101 
101 

103 
103 
102 
101 

102 

99 
99 
99 
98 
98 
98 

96 
96 
96 
93 
93 
93 

99 
98 
96 
93 

97 

93 
93 
93 
91 
91 
91 

90 
90 
90 
95 
95 
95 

93 
91 
90 
95 

92 

111 
111 
111 
111 
111 
111 

104 
104 
104 
99 
99 
99 

111 
111 
104 
99 

105 

99 
99 
99 
98 
98 
98 

96 
96 
96 
91 
91 
91 

99 
98 
96 
91 

96 

91 
91 
91 
91 
91 
91 

91 
91 
91 

104 
104 
104 

91 
91 
91 
104 

94 

90 
88 
92 
92 
94 
94 

94 
102 
102 
102 
100 
100 

90 
94 
99 
101 

96 

100 
100 
100 
100 
100 
98 

98 
98 
106 
102 
102 
83 

100 
100 
101 
95 

99 

82 
94 
98 
100 
98 
100 

96 
94 
90 
96 
110 
118 

92 
100 
94 
108 

98 

99 
100 
100 
100 
99 
100 

100 
100 
102 
101 
100 
100 

100 
100 
101 
100 

100 

100 
100 
99 
100 
99 
99 

100 
101 
102 
100 
99 
99 

100 
99 
101 
99 

100 

99 
100 
100 
103 
104 
105 

120 
117 
116 
117 
116 
119 

100 
104 
118 
117 

110 

99 
99 
100 
100 
99 
99 

100 
100 
102 
101 
100 
100 

99 
99 
101 
100 

100 

100 

100 
99 
100 
99 
99 

99 
101 
102 
100 
99 
98 

100 
99 
101 
99 

100 

98 
100 
100 
103 
103 
105 

118 
116 
115 
116 
115 
119 

99 
104 
116 
117 

109 

February  

March  

April 

May               

June 

July 

August  

September  

October 

November  .           

December 

Quarters- 
First 

Second  .  .  . 

Third 

Fourth 

Year.    . 

1914—  Months- 
January  

February... 

March. 

April 

May 

June  

July.... 

August  

September 

October...              

November  

December  .     . 

Quarters- 
First 

Second  . 

Third  

Fourth  .  . 

Year.    . 

1915—  Months- 
January 

February 

March. 

April 

May. 

June 

July  

August 

September     .  .  . 

October  

November 

December 

Quarters- 
First... 

Second 

Third     . 

Fourth 

Year 

GOVERNMENT    CONTROL   OVER   PRICES. 


451 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 

UNCONTROLLED  PRICES  1916-1918. 
[Base:  Average  prices  July,  1913,  to  June,  1914=100.1 


The  building  materials  group. 

Glass 
class. 

.  Lumber  class. 

Paints  and  varnishes  class. 

All 
uncon- 
trolled. 

(10) 

Con- 
trolled. 

(24) 

Uncon- 
trolled. 

(38) 

All. 
(62) 

Con- 
trolled. 

(1) 

Uncon- 
trolled. 

(29) 

All. 
(30) 

1916—  Months- 
January  

105 
107 
107 
111 
111 
112 

112 
112 
113 
114 
114 
114 

106 
112 
113 
114 

111 

138 
138 
138 
139 
139 
144 

145 
145 
145 
145 
155 
155 

138 
141 
145 
152 

144 

161 
161 
168 
168 
169 
170 

171 
171 

178 
178 
178 
179 

163 
169 
173 

178 

171 

117 
117 
117 
113 
113 
113 

109 
109 
109 
119 
119 
119 

117 
113 
109 
119 

115 

128 
128 
128 
164 
164 
164 

171 
171 
.  171 
171 
»171 
171 

128 
164 
171 
171 

159 

179 

179 
179 
190 
190 
190 

188 
188- 
188 
184 
184 
184 

179 
190 

188 
184 

185 

99 
99 
99 
99 
99 
99 

100 
100 
100 
103 
103 
103 

99 
99 
100 
103 

100 

111 
111 
111 

125 
125 
125 

131 
131 
131 
137 
137 
137 

111 
125 
131 
137 

125 

142 

142 
142 
152 
152 
152 

153 
153 
153 
154 
154 
154 

142 
152 
153 

154 

150 

111 
111 
111 
108 
108 
108 

106 
106 
106 
113 
113 
113 

111 
108 
106 
113 

109 

122 
122 
122 
150 
150 
150 

156 
156 
156 
159 
159 
159 

122 
150 
156 
159 

146 

166 
166 
166 
176 
176 
176 

176 
176 
176 
173 
173 
173 

166 
176 
176 
173 

172 

121 
134 
139 
153 
146 
134 

121 
118 
121 
146 
165 
181 

132 
144 
120 
163 

140 

188 
188 
204 
213 
228 
236 

224 
200 
226 
242 
»260 
271 

194 
225 
217 
258 

223 

276 

287 
294 
307 
307 
287 

283 
287 
283 
287 
278 
271 

286 
299 
284 
278 

287 

124 
132 
137 
154 
155 
152 

146 
143 
144 
142 
146 
150 

131 
154 
144 
146 

144 

154 
156 
161 
165 
171 
174 

180 
181 
183 
176 
172 
175 

157 
170 
181 
174 

171 

176 
176 
190 
205 
207 
210 

222 
228 
232 
231 
227 
226 

181 
207 
228 
228 

211 

124 
132 
137 
154 
154 
152 

145 
142 
142 
142 
147 
151 

131 
153 
143 
147 

144 

156 

157 
163 
168 
174 
177 

182 
182 
185 
179 
177 
180 

159 
173 
183 
178 

173 

181 
181 
195 
210 
211 
214 

225 
231 
235 
234 
229 
228 

186 
212 
230 
230 

214 

February                

March 

April  .  .  . 

May 

June 

July 

August  

September 

October 

November  

December.   . 

Quarters- 
First 

Second  .  .  . 

Third 

Fourth 

Year 

1917—  Months- 
January  

February 

March 

April... 

May 

June 

July  

August  .  . 

September 

October  

November  . 

December 

Quarters- 
First  

Second  .  . 

Third 

Fourth 

Year 

1918—  Months- 
January  .  .            ... 

February 

March 

April.. 

May 

June 

July 

August  

September 

October  

November  

December 

Quarters- 
First 

Second  .  .  . 

Third     .  . 

Fourth 

Year.  .  . 

'Price  control  began  during  month. 


452 


HISTORY   OF   PRICES   DURING   THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 
UNCONTROLLED  PRICES,  1913-1915. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


me  cnemicais  group. 

Mineral  acids  class. 

Heavy  chemicals  class. 

Miscellaneous  inorganic 
chemicals  class. 

Ferti- 
lizers 

class. 

Con- 
trolled. 

(6) 

Un- 
con- 
trolled. 

(2) 

All. 

(8) 

Con- 
trolled. 

(3) 

Un- 
con- 
trolled. 

(6) 

All. 
(9) 

Con- 
trolled. 

(2) 

Un- 
con- 
trolled. 

(18) 

All. 

(20) 

All 

con- 
trolled. 

(25) 

1913—  Months- 
January  
February  .  .  . 
March.  . 

102 
102 
102 
102 
102 
102 

102 
102 
101 
101 
100 
99 

102 
102 
102 
100 

102 

99 
99 
99 
99 
99 
99 

99 
98 
99 
98 
97 
97 

99 
99 
98 

97 

98 

97 
97 
97 
99 
100 
100 

123 
123 
141 
142 
145' 
146 

97 
100 
129 
144 

117 

100 
100 
100 
100 
100 
100 

100 

100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

133 
133 
152 
152 
152 
152 

100 
100 
139 
152 

123 

102 

102 
102 
102 
102 
102 

102 
102 
101 
101 
100 
99 

102 

102 
101 
100 

104 

99 
99 
100 
99 
100 
99 

99 

98 
99 

98 
97 
97 

99 
99 
99 

97 

99 

97 
97 
97- 
99 
100 
100 

123 
124 
141 
142 

145 
146 

97 
100 
129 
144 

118 

103 
103 
105 
105 
102 
102 

102 
102 
94 
100 
100 
100 

104 
103 
99 
100 

102 

100 
100 
100 
100 
100 
100 

100 
100 
100 
101 
101 
101 

100 
100 
100 
101 

100 

101 

99 
99 
105 
112 
112 

138 
169 
171 
202 
219 
316 

100 
110 
160 
245 

154 

97 
97 
101 
99 
101 
98 

102 
102 
102 
100 
102 
101 

98 
99 
102 
101 

100 

101 
100 
100 
96 
95 
97 

101 
99 
99 

98 
99 
96 

100 
96 
100 

98 

96 

96 
96 
95 
98 
96 
95 

103 
102 
102 
102 
109 
111 

96 
96 
102 
107 

101 

101 
101 
104 
103 
101 
100 

102 
102 
97 
100 
101 
100 

102 
101 
100 
101 

101 

101 
100 
100 
99 
99 
99 

100 
100 
100 
100 
100 
99 

100 
99 
100 
100 

100 

99 
98 
98 
103 
107 
107 

127 
148 
149 
170 
183 
250 

99 
106 
141 
201 

137 

104 
104 
103 
102 
102 
101 

101 
101 
100 
100 
100 
100 

104 
102 
101 
100 

102 

99 
100 
100 
100 
100 
100 

100 
99 
104 
104 
103 
102 

100 
100 
101 
103 

101 

102 
102 
102 
102 
102 
102 

102 
101 
102 
101 
101 
101 

102 
102 
101 
101 

102 

102 
102 
101 
101 
101 
101 

101 
101 
101 
101 
100 
100 

102 
101 
101 
100 

101 

100 
100 
100 
100 
100 
98 

98 
98 
123 
117 
114 
117 

100 
99 
107 
116 

105 

117 
122 
121 
127 
129 
132 

146 
152 
151 

156 
163 

178 

119 
129 
149 
165 

141 

102 
102 
101 
101 
101 
101 

101 
101 
101 
101 
100 
100 

102 
101 
101 
100 

101 

100 
100 
100 
100 
100 
99 

99 
98 
120 
115 
112 
115 

100 
99 
106 
114 

105 

115 
119 
118 
123 
125 
127 

139 
144 
143 
147 
153 
165 

116 
125 
142 
155 

134 

103 
103 
103 
104 
104 
103 

103 
100 
99 
99 
99 
100 

103 
104 
101 
100 

102 

100 
100 
101 
100 
100 
99 

98 
98 
99 
98 
96 
96 

100 
100 
99 
97 

99 

95 
98 
99 
102 
103 
101 

104 
105 
109 
116 
134 
142 

97 
102 
106 
130 

109 

April  
May  

June 

July..:  
August  
September  .  . 
October  
November.  . 
December.  .  . 

Quarters- 
First  
Second. 

Third 

Fourth..     .. 

Year  

1914—  Months- 
January  
February.  .. 
March 

April  . 

May 

June  . 

July.     .. 

August  
September. 
October.... 
November  . 
December.  . 

Quarters- 
First 

Second.  .  . 

Third 

Fourth  

Year  

1915—  Months- 
January  
February.  .. 
March 

April... 

May 

June  

July  

August 

September  .  . 
October  
November.  . 
December.  .  . 

Quarters- 
First  
Second  
Third  

Fourth  
Year  

GOVERNMENT   CONTROL  OVER  PRICES. 


453 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO  CONTROLLED  AND 

UNCONTROLLED  PRICES,  1916-1918. 
[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  chemicals  group. 

Mineral  acids  class. 

Heavy  chemicals  class. 

Miscellaneous  inorganic 
chemicals  class. 

Ferti- 
lizers 
class. 

Con- 
trolled. 

(6) 

Un- 
con- 
trolled. 

(2) 

All. 

(8) 

Con- 
trolled. 

(3) 

Un- 
con- 
trolled. 

(6) 

All. 
(9) 

Con- 
trolled. 

(2) 

Un- 
con- 
trolled. 

(18) 

All. 
(20) 

All 
con- 
trolled. 

(25) 

1916—  Months- 
January  
February  .  .  . 
March  
April  
May 

183 
194 
197 
196 
181 
180 

153 
139 
137 
133 
132 
133 

192 
186 
143 
133 

163 

133 
134 
144 
149 
155 
148 

152 
167 
170 
171 
176 
186 

137 
151 
163 

177 

157 

i  181 
191 

197 
202 
184 
174 

154 
154 
154 
142 
142 
142 

190 

187 
154 
142 

168 

208 
208 
208 
208 
208 
245 

208 
170 
170 
152 
152 
152 

208 
220 
183 
152 

190 

137 
137 
137 
138 
120 
120 

138 
138 
138 
148 
151 
158 

137 
126 
138 
'  152 

138 

162 
158 
158 
232 
232 
195 

176 
176 
162 
162 
162 
162 

159 
219 
171 

162 

178 

183 
195 
197 
196 
182 
182 

154 
140 
138 
134 
133 
133 

192 
187 
144 
133 

164 

133 
134 
144 
148 
154 
147 

152 
166 
169 
170 
175 
185 

137 
150 
162 
177 

157 

180 
190 
196 
203 
185 
175 

155 
155 
155 
143 
143 
143 

189 
188 
155 
143 

169 

350 

507 
498 
443 
351 
367 

327 
310 
330 
359 
343 
371 

451 
387 
322 
358 

379 

351 

340 
337 
352 
384 
373 

381 
394 
519 
471 
403 
.    410 

342 

370 
431 
427 

393 

246 
263 
346 
1323 
299 
293 

245 
254 
301 
331 
327 
278 

318 
305 
267 
312 

301 

115 
117 
117 
121 

120 
122 

125 
123 
121 
123 
120 
126 

116 
121 
123 
122 

121 

166 
164 
168 
179 
185 
190 

193 
196 
192 
203 
215 
214 

166 
185 
194 
211 

189 

225 
217 
217 
225 
230 
226 

224 
235 
227 
243 
252 
239 

220 

227 
229 
245 

230 

274 
381 
375 
339 
276 
288 

262 
249 
262 
283 
271 
292 

343 
301 

258 
282 

296 

291 
283 
283 
296 
320 
314 

321 
330 
414 
384 
342 
347 

286 
310 
355 
358 

327 

239 
316 
304 
292 
276 
271 

238 
248 
277 
303 
303 
266 

287 
280 
255 
290 

278 

103 
104 
106 
108 
108 
107 

107 
107 
107 
106 
107 
110 

104 

108 
107 
108 

107 

112 
117 
122 
133 
135 
135 

135 
151 
154 
149 
i  151 
150 

117 
134 
147 
150 

137 

132 
149 
149 
132 
133 
133 

133 
133 
133 
132 
132 
132 

144 
133 
133 
132 

135 

218 
251 
256 
281 
275 
261 

243 

226 
225 
232 
221 
228 

242 
273 
231 
227 

243 

231 
237 
229 
242 
247 
248 

254 
252 
256 
254 
233 
234 

232 
246 
254 
240 

243 

252 
235 
236 
258 
261 
256 

240 
240 
235 
254 
251 
230 

241 

258 
238 
245 

246 

199 
227 
231 
253 

248 
236 

221 
207 
206 
211 
202 
208 

219 
246 
211 
207 

221 

212 

218 
211 
224 
229 
230 

235 

236 
239 
237 
220 
'    220 

213 
228 
237 
226 

226 

233 
221 
222 
237 
240 
236 

223 
223 
218 
234 
232 
214 

225 

238 
221 
227 

228 

174 
179 
179 
177 
159 
156 

141 
135 
134 
136 
138 
141 

177 
164 
137 
138 

154 

144 
145 
148 
151 
156 
166 

173 
187 
189 
198 
193 
202 

146 
158 
183 

198 

171 

1203 
215 
215 
218 
206 
203 

195 
197 
190 
187 
187 
184 

211 
209 
194 
186 

200 

June  

July  

August  
September  .  . 
October  
November.  . 
December.  .  . 

Quarters  — 
First. 

Second.  .  . 
Third  
Fourth  

Year.  . 

1917—  Months- 
January  
February  .  .  . 
March 

April... 

May  

June 

July. 

August  
September.. 
October  
November  .  . 
December.  .  . 

Quarters- 
First  

Second  
Third 

Fourth  

Year 

1918—  Months- 
January  
February  .  .  . 
March... 

April... 

May 

June  

July  
August  
September  .  . 
October  
November.  . 
December.  .  . 

Quarters- 
First  

Second  
Third  
Fourth  

Year  

Price  control  began  during  month. 


454 


HISTORY  OF  PRICES  DURING  THE   WAR. 


PRICE     SECTION     WEIGHTED    INDEX    NUMBER     SEPARATED     INTO    CONTROLLED 
AND   UNCONTROLLED   PRICES,   1913-1915. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  chemicals  group. 

Soaps  and  glycerin 
class. 

Essen- 
tial 
oils, 
flavor- 
ing 
and 
per- 
fum- 
ery 
mate- 
rials 
class. 

Wood  distillation  prod- 
ucts and  naval  stores 
class. 

Natural  dyestuffs   and 
tanning    chemicals 
class. 

Con- 
trolled. 

(21) 

Uncon- 
trolled. 

(9) 

All. 
(30) 

All  un- 
con- 
trolled. 

(20) 

Con- 
trolled. 

(5) 

Uncon- 
trolled. 

(4) 

All. 
(9) 

Con- 
trolled. 

(1) 

Uncon- 
trolled. 

(18) 

All. 
(19) 

1913—  Months- 
January  
February  .  .  . 
March  

96 
99 
100 
101 
100 
99 

99 
102 
102 
102 
101 
101 

98 
100 
101 
101 

100 

100 
100 
99 
99 
99 
97 

98 
98 
114 
106 
99 
98 

100 
98 
103 
101 

100 

98 
102 
102 
102 
102 
99 

97 
98 
109 
125 
152 
158 

101 
101 
102 
145 

112 

99 
99 
99 
99 
99 
99 

99 
100 
100 
100 
101 
101 

99 
99 
100 
101 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
99 
99 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

98 
99 
99 
100 
99 
99 

99 
101 
101 
101 
101 
101 

99 
99 
100 
101 

100 

100 
100 
100 
99 
99 
99 

99 
99 
104 
101 
99 
99 

100 
99 
101 
101 

100 

99 
100 
100 
100 
100 
99 

99 
99 
102 
107 
115 
117 

100 
100 
100 
113 

103 

90 
96 
93 
94 

97 
102 

106 
107 
104 
105 
101 
99 

93 
97 
106 
101 

99 

97 
97 

97 
98 
96 
95 

98 
94 
102 
99 
92 
89 

97 
96 
98 
93 

96 

88 
76 
77 
76 
75 
75 

76 
72 
71 
72 

77 
80 

80 
75 
73 
76 

76 

121 
121 
121 
119 
119 
118 

118 
116 
116 
108 
103 
103 

121 
119 
117 
104 

115 

95 
95 

87 
87 
87 
87 

87 
87 
»     88 
89 
93 
102 

92 
87 
87 
95 

90 

110 
113 
113 

128 
128 
138 

154 
160 
.  173 
173 
181 
198 

112 
131 
162 

184 

147 

118 
129 
133 
118 
105 
105 

101 
93 

98 
92 
98 
97 

127 
109 

98 
96 

107 

103 
109 
102 
100 
102 
104 

104 
103 

100 
99 
98 
96 

105 
103 
103 

98 

102 

93 
90 
90 
94 
100 
90 

94 
91 
87 
96 
128 
144 

91 
94 
90 
122 

99 

119 
126 
129 
118 
109 
110 

107 
100 
104 
97 
100 
99 

125 
112 
104 
99 

110 

100 
104 
97 
96 
97 
99 

99 
97 
96 
96 
97 
98 

101 

97 
98 
97 

98 

98 
97 
98 
105 
109 
105 

113 
113 
115 
121 
145 
161 

98 
106 
114 
143 

115 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
153 
211 
252 
252 
252 

100 
100 
155 
252 

152 

102 
102 
102 
103 
103 
102 

102 
102 
102 
101 
99 
99 

102 
103 
102 
100 

102 

99 
99 
99 
99 
99 
99 

99 
99 
124 
125 
129 
127 

99 
99 
107 
127 

108 

122 
124 
125 
136 
138 
148 

152 

170 
182 
195 
209 
226 

124 
140 

168 
210 

161 

102 
102 
102 
103 
103 
101 

101 
101 
101 
100 
99 
99 

102 

102 
101 
100 

101 

99 
99 
99 
99 
99 
99 

99 
99 
119 
119 
122 
121 

99 
99 
106 
121 

106 

117 
118 
119 
128 
129 
136 

140 
166 
189 
208 
220 
233 

118 
131 
165 
220 

159 

April... 

May.. 

June 

July  
August  

September  .  . 
October  
November  .  . 
December.  .  . 

Quarters- 
First  

Second. 

Third  

Fourth. 

Year  

1914-Months— 
January  
February.  .  . 
March 

April... 

May 

June  .  . 

July  

August  
September  . 
October.... 
November  . 
December.  . 

Quarters- 
First  

Second 

Third  
Fourth  

Year. 

1915-Months— 
January  
February  .  .  . 
March 

April.. 

May 

June  .  . 

July  

August 

September  .  . 
October  
November  .  . 
December.  .  . 

Quarters- 
First  
Second  
Third 

Fourth  
Year  

GOVERNMENT   CONTROL   OVER   PRICES. 


455 


PRICE     SECTION     WEIGHTED    INDEX    NUMBER    SEPARATED     INTO    CONTROLLED 
AND   UNCONTROLLED   PRICES,   1916-1918. 

[Base:  Average  prices  July,  1913,  to  June,  1914=100.] 


The  chemicals  group. 

Soaps  and  glycerin 
class. 

Essen- 
tial 
oils, 
flavor- 
ing 
and 
per- 
fum- 
ery 
mate- 
rials 
class. 

Wood  distillation  prod- 
ucts and  naval  stores 
class. 

Natural   dyestuffs   and 
tanning    chemicals 
class. 

Con- 
trolled. 

(21) 

Uncon- 
trolled. 

(9) 

All. 
(30) 

All  un- 
con- 
trolled. 

(20) 

Con- 
trolled. 

(5) 

Uncon- 
trolled. 

(4) 

All. 
(9) 

Con- 
trolled. 

(1) 

Uncon- 
trolled. 

(18) 

All. 

(19) 

1916—  Months- 
January  
February  .  .  . 

March 

154 
161 
171 

187 
189 
177 

164 
142 
148 
166 
180 
190 

162 
185 
151 
179 

169 

187 
193 
196 
208 
238 
260 

253 

238 
260 
265 
1267 
274 

192 
235 
250 
269 

236 

276 
277 
275 
273 
269 
269 

269 
274 
275 
279 
275 
219 

276 
271 
273 
257 

269 

100 
100 
100 
101 
101 
101 

101 
101 
101 
104 
108 
107 

100 
101 
101 
106 

102 

107 
107 
107 
110 
129 
144 

144 
138 
136 
136 
140 
140 

107 
127 
139 
139 

128 

142 

143 
147 
149 
153 
.       155 

158 
158 
160 
168 
165 
172 

144 
152 
159 

168 

156 

116 
118 
121 
126 
126 
123 

119 
113 
115 
122 
129 
131 

118 
125 
116 
127 

122 

130 
132 
133 
138 

161 
177 

175 

167 
172 
174 
177 
179 

132 
159 
171 
176 

160 

181 

182 
185 
185 
187 
188 

190 
192 
193 
201 
197 
186 

182 
187 
192 
194 

189 

79 

79 
81 
80 
82 
80 

80 
80 

82 
82 
82 
82 

79 
81 

81 
82 

81 

83 
82 
83 
81 
83 
91 

91 
92 
95 
105 
104 
101 

82 
85 
93 
104 

91 

102 
100 
100 
101 
105 
104 

103 
105 
112 
121 
124 
124 

101 
103 
107 
123 

108 

228 
260 
276 
275 
264 
264 

263 
263 
207 
170 
173 
185 

254 
268 
244 
176 

236 

186 
193 
193 
221 
226 
226 

245 

247 
253 
275 
282 
1291 

191 
224 
249 
282 

237 

284 
293 
284 
221 
221 
200 

201 
200 
200 
200 
200 
200 

288 
214 
200 
200 

226 

151 
156 
148 
146 
117 
128 

129 
145 
140 
136 
139 
144 

151 
131 
138 
140 

140 

151 
145 
142 
137 
141 
135 

126 
126 
139 
154 
156 
146 

146 
137 
130 
151 

141 

143 
146 
138 
131 
141 
182 

212 
212 
241 

259 
266 
255 

142 

152 
221 
260 

194 

176 
190 
189 
188 
165 
173 

173 
183 
162 
147 
150 
158 

185 
175 
173 
152 

171 

162 
161 

158 
164 
168 
164 

165 
166 
176 
193 
197 
193 

160 
166 
169 
.194 

172 

189 
194 
186 
161 
168 
188 

208 
208 
227 
240 
244 
237 

189 
172 
215 
241 

204 

274 
295 
295 
295 
295 
295 

295 

295 
295 
295 
295 
295 

288 
295 
295 
295 

294 

295 
295 
295 
295 
295 
295 

295 
295 
295 
211 
211 
211 

295 
295 
295 
211 

274 

189 
189 
189 
252 
1252 
295 

201 

201 
201 
201 
201 
201 

189 
266 
.201 
201 

213 

280 
344 
360 
361 
351 
350 

292 
259 
252 
232 
228 
220 

328 
355 
268 
227 

294 

221 

220 
223 
222 
220 
213 

210 
211 
210 
217 
206 
202 

222 
218 
210 
209 

215 

204 
208 
215 
219 
233 
236 

250 
252 
253 
251 
254 
255 

209 
229 
252 
254 

236 

278 
333 
345 
346 
338 
337 

293 

268 
262 
247 
244 
238 

319 
341 
274 
243 

294 

238 
238 
240 
239 
238 
232 

230 
231 
230 
215 
207 
204 

239 
236 
230 
209 

229 

201 
203 
209 
227 
238 
250 

238 
240 
240 
239 
241 
242 

204 
238 
240 
241 

231 

April  

Mav  

June 

July  . 

August  

September  .  . 
October  
November.  . 
December.  .  . 

Quarters- 
First  
Second  

Third 

Fourth 

Year 

1917—  Months- 
January  
February  .  .  . 
March 

April... 

Mav  .  . 

June  
July 

August  

September  .  . 
October  
November.  . 
December.  .  . 

Quarters- 
First  

Second  
Third 

Fourth 

Year 

1918—  Months- 
January  
February.  .  . 
March.  .  * 

April 

May.... 

June 

July  

August  
September  .  . 
October  
November  .  . 
December.  .  . 

Quarters  — 
First  

Second  
Third  
Fourth  

Year. 

Price  control  began  during  month. 


456 


HISTORY  OF   PRICES   DURING   THE   WAR. 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER   SEPARATED   INTO  CONTROLLED  AND 
UNCONTROLLED   PRICES,  1913-1915- 

[Base:  Average  prices  July,  1913,  to  July,  1914=100.] 


The  chemicals  group. 

Coal  tar  crudes,  in- 
termediates, and 
dyes  class. 

Drugs 
and 
phar- 
ma- 
ceuti- 
cals 
class. 

Pro- 
prie- 
tary 
prep- 
ara- 
tions 
class. 

Explosives  class. 

Miscellaneous    or- 
ganic   chemicals 
class. 

Con- 
trolled. 

(1) 

Un- 
con- 
trolled. 

(18) 

All. 
(19) 

All  un- 
con- 
trolled. 

(27) 

All  un- 
con- 
trolled. 

(23) 

Con- 
trolled. 

(9) 

Un- 
con- 
trolled. 

(10) 

All. 
(19) 

Con- 
trolled. 

(2) 

Un- 
con- 
trolled. 

(12) 

All. 
(14) 

1913—  Months- 
January  

83 
83 
83 
100 
100 
100 

100 
100 
100 
100 
100 
100 

83 

100 
100 
100 

96 

100 
100 
100 
100 
100 
100 

117 
117 
117 
117 
117 
117 

100 
100 
117 
117 

109 

117 
117 
117 
833 
833 
833 

1167 
1167 
1167 
1418 
1418 
1500 

117 
833 
1167 
1445 

889 

112 
112 
111 
114 
113 
112 

112 
107 
105 
103 
103 
102 

112 
113 
108 
103 

109 

95 
94 
95 
95 
95 
94 

101 
106 
195 
.  225 
267 
233 

95 
95 
134 
242 

141 

255 
411 

448 
554 
435 
572 

628 
638 
648 
663 
666 
680 

371 

520 
638 
667 

549 

109 
109 
108 
113 
112 
111 

111 
106 
105 
103 
103 
102 

109 
112 
107 
103 

108 

95 
95 
95 
95 
95 
95 

103 
107 
187 
215 
252 
222 

95 
95 
132 
230 

138 

242 
383 
417 
581 
473 
596 

679 

688 
697 
735 
737 
758 

347 

550 
688 
741 

582 

103 
103 
100 
100 
100 
99 

98 
99 
101 
100 
99 
99 

102 

100 
99 
99 

100 

100 
102 
101 
100 
100 
101 

101 
106 
136 
134 
124 
118 

101 
100 
114 
125 

110 

117 
116 
117 
122 
126 
132 

132 
138 
147 
152 
174 
178 

116 
127 
139 
168 

137 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
101 
101 
101 
101 
100 

100 
100 
100 
100 
100 
100 

101 
101 
100 
100 

101 

103 
102 
104 
103 
103 
103 

103 
103 
103 
100 
102 
102 

103 
103 
103 
101 

102 

98 
98 
99 
99 
97 
98 

95 
100 
98 
96 
96 
97 

98 
98 
98 
96 

98 

97 
98 
97 
107 
109 
111 

143 
142 
158 
175 
181 
177 

97 
109 
148 
177 

133 

104 
104 
104 
104 
104 
104 

104 
103 
103 
99 
102 
103 

104 
104 
103 
101 

103 

98 
97 
99 
99 
96 
98 

94 
98 
102 
101 
106 
104 

98 
98 
98 
104 

99 

188 
187 
186 
189 
188 
200 

200 

198 
209 
212 
217 
219 

187 
193 
202 
216 

199 

104 
103 
104 
103 
103 
104 

103 

103 
103 
98 
102 
102 

104 
103 
103 
101 

103 

98 
97 
99 
99 
96 
98 

94 
98 
100 
99 
103 
102 

98 
98 
98 
102 

99 

161 
161 
160 
165 
165 
174 

183 
181 
194 
201 
207 
206 

161 
168 
186 
205 

180 

107 
103 
103 
103 
103 
101 

101 
101 
101 
101 
99 
99 

104 
102 
101 
100 

102 

99 
99 
99 
99 
99 
99 

99 
142 
142 
137 
142 
142 

99 
99 
128 
140 

117 

137 
125 
125 
142 
148 
154 

154 
148 
155 
152 
166 
166 

129 
148 
152 
162 

148 

106 
105 
105 
102 
101 
101 

100 
100 
101 
101 
99 
98 

106 
101 
100 
99 

102 

99 
101 
100 
100 
100 
100 

98 
98 
101 
103 
102 
102 

100 

100 
99 
102 

100 

102 
100 
100 
100 
100 
104 

106 
108 
109 
109 
117 
119 

100 
101 
107 
115 

106 

106 
105 
105 
102 
101 
101 

100 
100 
101 
101 
99 
98 

106 
102 
100 
99 

102 

99 
101 
100 
100 
100 
100 

98 
99 
102 
104 
103 
103 

100 
100 
100 
103 
101 

102 
101 
100 
101 
101 
105 

108 
108 
110 
110 
119 
120 

101 
103 

108 
116 

107 

February  

March 

April  

May... 

June         

July 

August  

September 

October  

November 

December 

Quarters- 
First  

Second      

Third  

Fourth 

Year 

1914—  Months- 
January  

February 

March  

April 

SSy  :: 

June 

July 

August    

September  

October  
November  

Dp-wmbpr 

Quarters- 
First  

Second          .  .  . 

Third  

Fourth 

Year               .  ... 

1915—  Months- 
January 

February... 

March  
April  .. 

May 

June  

July  

August 

September  

October 

November  
December  

Quarters- 
First 

Second  

Third 

Fourth  

Year 

GOVERNMENT   CONTROL   OVER  PRICES. 


457 


PRICE  SECTION  WEIGHTED  INDEX  NUMBER  SEPARATED  INTO   CONTROLLED  AND 
UNCONTROLLED   PRICES,  1916-1918. 

[Base:  Average  prices  July,  1913,  to  July,  1914=100.] 


The  chemicals  group. 

Coal  tar  crudes,  in- 
termediates, and 
dyes  class. 

Drugs 
and 
phar- 
ma- 
ceuti- 
cals 
class. 

Pro- 
prie- 
tary 
prep- 
ara- 
tions 
class. 

Explosives  class. 

Miscellaneous   or- 
ganic chemicals 
class. 

Con- 
trolled. 

(1) 

Un- 
con- 
rolled. 

(18) 

All. 
(19) 

Allun- 
con- 
rolled. 

(27) 

All  un- 
con- 
trolled. 

(23) 

Con- 
rolled. 

(9) 

Un- 
con- 
trolled. 

(10) 

All. 
(19) 

Con- 
rolled. 

(2) 

Un- 
con- 
rolled. 

(12) 

All. 
(14) 

1916—  Months- 
January 

1500 
1500 
1500 
1500 
1500 
1167 

1167 
1167 
667 
667 
500 
500 

1500 
1389 
1000 
556 

1111 

500 
500 
500 
500 
500 
500 

500 
500 
500 
500 
500 
500 

500 
500 
500 
500 

500 

500 
1500 
500 
500 
500 
500 

500 
500 
500 
500 
500 
83 

500 
500 
500 
360 

464 

668 
652 
643 
560 
560 
531 

465 
306 
377 
363 
363 
358 

654 
551 
416 
361 

495 

350 
344 
329 
307 
299 
'301 

285 
281 
280 
271 
286 
297 

341 
303 

282 
285 

303 

292 
291 
295 

288 
276 
276 

258 
255 
257 
250 
251 
244 

293 
280 
257 
249 

270 

747 
732 
724 
649 
649 
591 

532 
478 
405 
392 
376 
371 

734 
630 
471 
379 

553 

364 
359 
345 
325 
318 
320 

305 
302 
300 
293 
307 
316 

356 
321 
302 
305 

321 

312 
311 
314 

308 
297 
297 

281 
278 
280 
•274 
275 
229 

312 

301 
280 
259 

289 

194 
209 
216 
226 
224 
209 

198 
191 
192 
189 
197 
196 

203 

217 
195 
194 

202 

192 
197 
214 

222 
227 
224 

223 
221 
224 
230 
232 
234 

202 
225 
223 
232 

220 

235 
238 
240 
239 
241 
243 
246 
253 
259 
274 
319 
288 

238 
241 
251 
294 

256 

100 
100 
102 
102 
102 
102 

102 
102 
102 
102 
102 
102 

101 
102 
102 
102 

101 

102 
102 
103 
103 
103 
104 

105 
105 
108 
110 
110 
110 

102 
104 
106 
110 

106 

112 
112 
112 
112 
112 
112 

113 
114 
114 
116 
117 
117 

112 
112 
114 
117 

114 

179 
186 
188 
190 
188 
184 

171 
159 
150 
151 
147 
149 

184 
187 
160 
149 

170 

147 
147 
152 
158 
165 
163 

169 
169 
172 
173 

U75 

178 

149 
165 
170 
175 

166 

174 
179 
183 
184 
183 
179 

167 
166 
166 
162 
163 
141 

179 
182 
166 
155 

170 

211 
212 
208 
201 

188 
189 

186 
182 
177 
171 
169 
156 

210 
192 
182 
165 

187 

140 
132 
130 
128 
136 
137 

133 
134 
136 
136 
140 
140 

134 
134 
134 
138 

135 

138 
138 
138 
135 
136 
136 

135 
137 
137 
136 
137 
135 

138 
136 
136 
136 

136 

202 
204 
202 
197 

188 
187 

182 

175 
169 
165 
162 
154 

203 
191 
175 
160 

182 

142 
137 
136 
137 
145 
144 

144 
144 
142 
147 
151 
151 

138 
143 
145 
149 
144 

149 
150 
151 
149 
150 
149 

145 
146 
145 
144 
144 
137 

150 
145 
145 
142 

146 

166 
160 
160 
171 
171 
199 

191 
181 
175 
158 
158 
160 

162 
180 
182 
159 

171 

175 
175 
183 
184 
201 
211 

211 
208 
201 
201 
206 
210 

177 
199 
207 
206 

197 

217 
1219 
217 
217 
217 
210 

198 
201 
280 
280 
280 
280 

218 
214 
226 
280 

234 

123 
128 
132 
133 
134 
134 

133 
123 
123 
127 
132 
136 

128 
134. 
127 
132 

130 

136 
135 
135 
142 
151 
152 

197 
205 
210 
232 
216 
212 

135 
148 
204 
220 

177 

202 
199 
199 

198 
198 
198 

199 
199 
199 
198 
200 
195 

200 

198 
199 
198 

199 

124 
129 
133 
134 
135 
135 

135 
125 
125 
128 
133 
137 

129 
135 
128 
133 

131 

137 
136 
137 
143 
153 
153 

197 
205 
210 
232 
216 
212 

136 
149 
204 
220 

177 

202 
200 
200 
199 
199 
198 

199 
199 
201 
200 
202 
197 

200 
198 
200 
200 

200 

February... 

March      

April 

May... 

June            .  . 

July  

August 

September  

October 

November  
December  

Quarters- 
First             

Second  
Third       

Fourth 

Year 

1917—  Months- 
January  
February  
March  
April 

Mav  

June  
July  

August  
September  
October  
November 

December  

Quarters- 
First 

Second       

Third 

Fourth  

Year 

1918—  Months- 
January  
February 

March  

April 

May  

June       ...:... 

July 

August  

September  
October  

November  
December  

Quarters- 
First        

Second 

Third  

Fourth  
Year 

1  Price  control  began  during  month. 


458  HISTORY  OF  PRICES   DURING  THE   WAR. 

There  follows  a  separation  of  the  1,366  commodities  carried  in  the 
Price  Section  Index  Number  into  those  controlled  and  uncontrolled. 
The  separation  indicated  forms  the  basis  for  all  comparisons  in  this 
section,  for  the  chain  index  of  controlled  and  uncontrolled  prices 
and  for  frequent  illustrations  in  the  inquiry.  The  individual  com- 
modity series  counted  as  controlled  are  listed  here  under  their 
proper  classes,  as  numbered  in  the  "  History  of  Prices  During  the 
War,"  when  one  or  more  series  of  a  class  came  under  control.  This 
method  was  also  used  to  list  the  uncontrolled  series.  The  class  index 
numbers  for  the  controlled  and  uncontrolled  series  run  parallel 
The  first  of  the  50  classes  in  the  Price  Section  Index  Number,  for 
example,  is  known  as  "8.  Feeds  and  Forage  Class"  and  the  last  as 
"57.  Miscellaneous  Inorganic  Chemical  Class."  A  full  count  of  the 
series  in  one  of  these  classes  under  the  controlled  list,  and  of  those 
in  the  same  class  under  the  uncontrolled  list,  makes  up  the  full 
number  of  series  carried  by  the  Price  Section  for  that  class. 


GOVERNMENT   CONTROL   OVER   PRICES.  459 

(2)  THE  SERIES  OF  THE  PRICE  SECTION  INDEX  NUMBER  CONSIDERED 

UNCONTROLLED. 

FOOD  GROUP. 

10.  Corn  and  corn  products  class  (3  series): 

Alcohol,  grain,  190  proof. 

Beer,  western,  light  or  dark. 

Whisky,  Bourbon,  4  years  in  bond,  100  proof. 

11.  Oats,  buckwheat,  and  rice  class  (1  series): 

Puffed  rice. 

12.  Barley,  hops,  rye,  and  their  products  class  (4  series): 

Beer,  light  or  dark. 

Hops,  Pacific  coast. 

Hops,  prime  to  choice,  New  York  State. 

Whisky,  rye,  straight,  4  years  in  bond,  100  proof. 

13.  Sugar  and  related  products  class  (1  series): 

Honey,  clover,  comb,  lower  grade. 

15.  Edible  vegetable  oils  class  (1  series'): 

Cocoa  beans,  in  bags. 

16.  Fruits,  nuts,  and  wine  class  (7  series): 

Almonds,  ne  plus  ultra,  unshelled. 
Apricots,  canned,  X  standard,  2J  California. 
Claret,  medium  grade,  California. 
Nuts,  Brazil,  medium,  unshelled. 
Peaches,  canned,  X  standard,  2$  California. 
Pineapple,  canned  X  standard,  2J  Hawaiian,  sliced 
Walnuts,  No.  1  soft  shelled. 

17.  Spices  and  condiments  class  (10  series): 

Cassia,  China  rolls. 

Cloves,  Zanzibar. 

Ginger,  Cochin,  A.  B.  C. 

Mace,  Singapore. 

Nutmegs,  105s  to  110s. 

Pepper — 

Black,  Lampong. 
Black,  Singapore. 
Red,  Japan. 

Salt- 
American,  medium. 
Domestic. 

18.  Tea,  coffee,  and  cocoa  class  (11  series): 

Cocoa — 

Arriba. 

Bahia. 

Trinidad. 
Tea- 
Ceylon,  Pekoe. 

Country,  green,  gunpowder. 

Country,  green,  imperial  firsts. 

Darzeeling,  fancy  orange. 

Formosa,  good. 

Goochow,  good. 

Pingsuey,  gunpowder,  firsts. 

Pingsuey,  imperial  firsts. 


460  HISTOKY   OF  PRICES   DURING   THE   WAR. 

19.  Tobacco  and  tobacco  products  class  (15  series): 
Broadleaf,  Connecticut,  second. 
Broadleaf,  Pennsylvania,  B's. 
Burley,  good  leaf,  bright  red. 
Cigars,  little,  under  3  pounds. 
Cigars,  little,  over  3  pounds. 
Cut  plug. 

Habana  Vuelta  Abajo. 
Habana,  remedies  fillers. 
Habana,  seed,  medium  and  dark  wrappers. 
Little  Dutch,  Ohio. 
Long  cut. 

riug. 

Scrap. 
Sumatra. 
Zimmers  Spanish. 

22.  Fish  and  oysters  class  (1  series): 

Codfish,  salt,  whole  bank  medium. 

CLOTHING  GROUP. 

23.  Cotton  and  cotton  products  class  (24  series): 

'  Cotton  (raw  materials) — 

Cotton,  average  in  the  United  States. 
Egyptian,  brown  F.  G.  F. 
Egyptian,  medium. 
Good,  No.  1,  Oomra. 
Long  staple,  strict  middling,  l£-inch. 
Long  staple,  strict  middling,  l-^-inch. 
Long  staple,  strict  middling,  l-|-inch. 
Long  staple,  strict  middling,  1^-inch. 
Sea  Island,  extra  choice. 
Short  staple,  upland  middling,  American. 
Short  staple,  upland  middling,  New  York. 
Short  staple,  upland  middling,  New  Orleans. 
Cotton  manufactures — 
Hosiery — 

Men's  half,  176  needles,  17/1  combed  yarn. 

Women's  full  fashioned,  18/1  combed  yarn,  33  gauge. 
Tire  fabric,  Sea  Island,  17^-ounce,  combed. 
Underwear — 

Long  staple,  men's   balbriggan,   178E,   5£  pounds  per  dozen,  26 
gauge,  22/1  combed  yarn. 

Long  staple,  merino  shirts  and  drawers,  50  per  cent  wool,  24  gauge. 

Long  staple,  men's  shirts  and  drawers,  flat  fleece,  12 J  to  13  pounds 
per  dozen. 

Long  staple,  women's  ribbed  union  suits,  12  pounds  per  dozen. 
Velvet,  millinery  (17  inch,  2.955  ounces  per  yard). 
Cotton  waste — 

Dirty  card  fly,  mill  run. 
No.  1  card  strips,  graded  stock. 
For  packing  purposes. 
Dirty  picker  motes,  mill  run. 


GOVERNMENT    CONTROL   OVER   PRICES.  461 

24.  Wool  and  woolen  products  class  (45  series): 
Blankets,  all-wool,  5  pounds  to  the  pair. 
By-products — 

Noils,  three-eighths  blood. 
Waste,  card,  one-fourth  blood. 
Tops- 
Australian,  64s. 
Buenos  Aires,  40s. 
Buenos  Aires,  46e. 
Territory,  56s. 
Knit  goods — 

Men's  shirts  and  drawers,  50  per  cent  wool,  24-gauge. 
Men's  half-hose,  seamless,  wool. 
Worsted  cloths — 
Dress  goods — 

Sicilian  cloth,  cotton  warp,  50-inch. 
Serge,  botany,  11433,  7-ounce,  54-inch. 
Serge,  10-ounce,  54-inch. 
Storm  serge,  double-warp,  50-inch. 
Suitings — 

Clay  diagonal,  16-ounce,  56  to  58  inch. 
Serge,  Fulton  Mills,  3192,  11-ounce,  56  to  58  inch. 
Trousering — 

Cotton  warp,  worsted-filled,  10  to  11  ounce,  60-inch. 
Woolen  cloths — 
Carpets — 

Axminster,  6  2/3  by  7. 
Body  Brussels,  9-wire,  256  pitch. 
Tapestry,  8-wire,  200  pitch. 

Broadcloth,  dress,  botany,  315,  10-ounce,  54  to  56  inch. 
Felt,  upholstery,  11  to  13  ounce. 
Felt,  interlining,  13-ounce. 
Overcoating — 

Melton,  Worumbo,  30-ounce,  58-inch. 
Twill,  plain  soft-faced,  black,  24-ounce,  54  to  56  inch. 
Suits,  serge,  5130. 
Shirtings- 
All-wool  flannel,  white  Ballard. 
Black  Thibet. 
Wool,  Middlesex. 

Velour,  dress,  Worumbo,  829,  11-ounce,  54-inch. 
Woolen  yarn — 

Carpet  yarn,  3-ply  velvet,  55  yards  to  the  ounce. 
Weaving  yarn,  12  to  16  run,  one-fourth  blood. 
Weaving  yarn,  20  to  28  run,  three-eighths  blood. 
Worsted  yarn — 

Carpet  yarn,  white  16s. 
French  system — 

l/40s,  one-half  blood. 
l/50s,  domestic. 

2/50s,  fine  territory  or  domestic. 
Knitting  yarn — 

2/5s  to  2/10s,  one-fourth  blood. 
2/lls  to  2/20s,  one-fourth  blood. 


462  HISTORY   OF   PRICES   DURING   THE   WAR. 

24.  Wool  and  woolen  products  class  (45  series) — Continued. 

Worsted  yarn — Continued. 

Knitting  yarn — Continued. 

2/16s  to  2/20s,  three-eighths  blood. 
2/20s  to  2/24s,  low,  one-fourth  blood. 
2/26s  to  2/30s,  one-half  blood. 
Weaving  yarns  Bradford  system — 
2/26s  to  2/30s,  one-fourth  blood. 
2/36s,  three-eighths  blood. 
2/40s,  one-half  blood. 
2/50s,  fine  territory  or  domestic. 

25.  Silk  and  silk  products  class  (52  series): 

Raw  silk,  Chinese — 

Canton  filature,  extra  extra  A. 
Steam  filature,  best  chops,  first  and  second  choice. 
Steam  filatures,  second  grade  chops. 
Tsatlee  improved,  Stars  and  Stripes,  and  Red  Indian. 
Tsatlee  improved  black  lion,  1,  2,  3. 
Tussah,  best  chops. 
Raw  silk,  Japanese — 

Filature,  Kansai,  13  to  15  extra  extra. 
Filature,  Shinshu,  No.  1,  13  to  15. 
Silk  manufactures — 
Broad  silk — 

Nos.  1  to  23,  inclusive. 

Japanese  Habutai,  6-momme,  36-inch. 

Japanese  Habutai,  3^-momme,  36-inch. 
Hose- 
Ladies',  all-silk,  standard  quality. 

Ladies',  medium- priced,  all-silk. 

Ladies',  cotton  feet,  silk-top. 

Men's  half,  all-silk. 

Men's,  cotton- top. 
Plush— 

Tussah  face,  cotton  back,  artificial  fur. 

Millinery,  artificial-silk  face,  cotton  back,  17-inch. 

Cloaking,  1410,  Tussah  warp,  cotton  filling. 
Ribbon — 

Satin  and  taffeta. 

All-silk,  satin,  and  taffeta. 
Velvet- 
Millinery,  colored  silk,  spun  silk  warp,  cotton  filling. 

Spun  warp,  millinery. 
Semimanufactures — 
Silk  thread- 
Embroidery,  No.  1. 

Embroidery,  No.  2. 
Spun  silk  yarn — 

Artificial  silk,  B  quality,  150  denier,  unbleached. 

Domestic,  60/1. 

Domestic,  gray,  spun,  60/2-1 

Imported,  200/2,  gray. 
Viscose  yarn,  artificial  silk,  B  quality   360  denier,  unbleached. 


GOVERNMENT    CONTROL   OVER   PRICES.  463 

26.  Hides  and  skins  and  their  products  class  (96  series): 
Calf-skin  leather — 

Full  grained,  bordered,  black  kip  II ,  second  grade. 
Full  grained,  bordered,  black,  L,  second  grade. 
Full  grained,  smooth,  black,  L,  second  grade. 
Full  grained,  smooth,  colored,  M,  second  grade. 
Snuffed,  smooth,  black,  M,  second  grade. 
Cattle  hide  leather — 

Case,  bag  and  strap  leather: 

Case,  colors,  2  Bounce,  B. 

Strap,  colors,  9-ounce,  B. 

Strap,  colors,  6-ounce,  B. 

Embossed  bag  and  belt,  4^-ounce,  B. 

Smooth  bag,  3£-ounce,  B. 
Cattle  side,  upper  leather — 

Chrome,  box,  1.  m.  weight,  A  quality. 

Chrome,  black,  slightly  corrected,  smooth. 

Chrome,  patent. 

Sides,  black  gun  metal,  1.  m.  weight,  A  quality. 

Waterproof,  H  weight,  A  quality. 
Offal,  heads,  bellies,  and  shoulders — 
Shoulders — 

Double-oak  belting. 

Hemlock. 
Heads- 
Scoured  oak  heads. 

Union  heads. 
Bellies- 
Hemlock  dry  hide  bellies. 
Skirting — 

California  oak,  No.  1. 

California  oak,  BB,  No.  2 
Horsehide  leather — 

Glove,  buffed,  M,  second  grade. 
Shoe,  upper  and  patent. 
Shoe,  upper  and  patent,  M,  second  grade. 
Shoe,  upper  and  patent,  upper,  M,  second  grade. 
Sheepskin  leather — 

Fancy  and  other  stock — 

Bag  roans. 

Black,  for  beading,  quarter  lining,  No.  1. 

Black,  for  beading,  quarter  lining,  No.  2. 

Black,  for  beading,  quarter  lining,  No.  3. 

Tops  and  plain  black  chrome. 

White  alum. 
Glove  stock — 

Domestic  Napa. 

Domestic  suede. 

Fleshers. 

South  African  cape. 
Glazed  kid  leather— 

Black  and  colors,  export  and  domestic. 


464  HISTORY   OF   PRICES   DURING   THE   WAR. 

26.     Hides  and  skins  and  their  products  class  (96  series) — Continued. 
Glazed  kid  leather — Continued. 
Shoe  stock — 

Black,  dull  and  glazed. 

Colors. 

Imitation  calf. 
Leather  manufactures — 

Bags,  cowhide,  2J-ounce,  18-inch. 
Belting- 
First  quality. 

Light  doubles. 

Regular  quality. 
Gloves,  men's — 

Unlined,  mocha,  P.  X.  M.,  first  grade. 

One  clasp,  P.  X.  M.,  unlined  cape,  first  grade. 

Silk  lined,  P.  X.  M.,  cape,  first  grade. 

Silk  lined,  P.  X.  M.,  mocha,  first  quality. 
Gloves,  women's  and  children's — 

Children's  gloves,  average  grade. 

One  clasp,  P.  X.  M.,  cape,  second  grade. 

One  clasp,  P.  K.,  cape,  first  grade. 

One  clasp,  P.  X.  M.,  first  grade. 
Harness,  sets — 

Standard  farm  team. 

Team,  all  purposes. 

Single  buggy,  standard. 

Horse  collars — 
High  grade. 

Standard  imitation  Scotch, 
Saddles- 
Riding,  high  grade. 
Spring  seat,  standard. 
Shoes,  boys'  and  youths'—- 
Boys'— 

Grade  I. 

Grade  II. 

Grade  III. 
Little  Gents'- 

Grade  I. 

Grade  II. 

Grade  III. 
Shoes,  men's— 

Black  calf  Oxford. 

Black  kid,  A-boot. 

Black,  low  price. 

Black,  Rumania  calf. 

Bench,  combination  tan  Oxfords. 

Bench,  patent  colt. 

Farmer,  mechanic,  and  laborer,  49-226. 

Farmer,  mechanic,  and  laborer,  49-307. 

Handstitched  patent  kid  Oxfords. 

Rumania  calf,  high. 

Steel  or  black  calf  A-boot. 

Tan,  low  price. 

Tan,  kid,  A-boot, 

Vici  kid. 


GOVERNMENT   CONTROL   OVER   PRICES.  465 

26.  Hides  and  skins  and  their  products  class  (96  series) — Continued. 

Shoes,  misses'  and  children's — 

Children's  gunmetal,  button,  low  heel,  sizes  9-ll|. 

Misses',  vici  patent,  button,  low  heel,  sizes  12-2^. 
Shoes,  women's — 

Black  kid,  button,  dull  kid  top. 

Black  kid,  lace,  regular  top,  classic  heel. 

Boots,  McKay. 

Boots,  welt. 

Brown  kid,  welt,  leather  heel,  7^-inch  boot. 

Glazed  kid,  Oxford,  leather  heel. 

Glazed  kid,  welt,  leather  heel,  7^-inch  boot. 

Kid  Oxford,  McKay. 

Low  shoes,  patent  leather. 

Oxford,  McKay. 

Oxford,  welt. 

Patent  kid,  full  seam  vamp,  black  cloth  top. 

Patent  pump  (T.  and  W.). 

Black  kid  (T.  and  W.). 
Suit  case,  cowhide,  2^-ounce,  24-inch. 

27.  Hatters'  fur  and  fur  felt  hats  class  (10  series): 

Coney — 

Best  B.  C.  B.  unpulled. 

French,  best  extra. 

French,  best  mottled. 

French,  unpulled. 

Scotch,  best  B.  C.  B. 
Hair,  best  001H. 
Hats- 
Fur  felt- A. 

Fur  felt    No.  1. 

Knox. 

Stetson. 

28.  Hair,  bristles,  and  feather  class  (22  series): 

Bristles- 
Chunking,  superior  No.  3. 

Chunking,  superior  No.  5. 

Hankow,  superior  No.  3. 

Hankow,  superior  No.  5. 

Tiensin,  superior  No.  3. 

Tiensin,  superior  No.  5. 
Brushes- 
Hair,  prophylactic,  No.  500. 

Hand,  prophylactic,  No.  400. 

Tooth,  prophylactic,  No.  1. 
Feathers — 

Chicken,  body,  colored,  dry  picked. 

Chicken,  body,  white,  dry  picked. 

Duck,  white  or  yellow. 

Geese,  mixed  gray. 

Geese,  prime  white. 

Turkey,  body,  white. 
Feather  articles — 

Mattress,  40-pound. 

Pillow,  chicken  feather,  18  by  25. 

125547°— 20 30 


466  HISTORY   OF   PRICES   DURING   THE   WAR. 

28.  Hair,  bristles,  am1  feather  class  (22  series)--Continued. 

Hair- 
Cattle,  washed,  domestic. 
Hog,  processed,  domestic. 
Horse  manes. 
Horse  tails. 

Hair  cloth,  50-pick,  24-inch. 

29.  Button  class  (20  series): 

Raw  materials — 

Shells,  fresh  water  pearl,  all  varieties. 

Shells,  yellow  Manila,  bold  and  bold  medium,  average  weight  1^  pounds 
Ocean,  West  Australian,  bold  medium,  average  weight  T8^  pound. 
Pearl,  Tahiti,  black  chickens,  average  weight  T%  pound. 
Vegetable  ivory  (Tagua  nuts). 
Manufactures — 
Buttons — 

Bone,  white,  commercial,  22-line. 
Bone,  underwear,  Navy  prices,  22-line. 
Glass,  jet,  18  line. 
Metal,  Army  blouse,  36-line. 
Metal,  trouser,  27-line. 
Pearl- 
Ocean  and  fresh  water. 

Imported,  ocean,  Trochus  Japanese,  first  grade. 
Fresh  water,  all  sizes  and  grades. 
Ocean,  West  Australian,  fine  shirt  button,  16-line. 
Ocean,  smoked  Panama,  36-line. 
Ocean,  Tahiti,  |  fine,  36-line. 
Ocean,  West  Australian,  ^  fine,  36-line. 
Shoe,  No.  4  bright  black,  regular  finish. 
Vegetable  ivory,  flannel  shirt,  24-line. 
Vegetable  ivory,  trouser,  black,  22-line. 

RUBBER,  PAPER  AND  FIBERS  GROUP. 

30.  Rubber  and  rubber  products  class  (24  series): 

Chemicals — 

Barytes,  domestic. 
Flowers,  sulphur. 
Lithopone. 
Magnesite,  calcined. 
Whiting,  commercial. 
Zinc  oxide,  standard  American  process. 
Fabrics — 

Cotton,  17^-ounce  Sea  Island,  combed. 
Reclaimed  rubber — 
Mechanical. 
Truck  tires. 
Rubber  products — 
Clothing,  rubber — 

Calendered,  single  texture,  western. 
Calendered,  double  coated,  fire  coat. 
Double  texture,  bombazine  coat. 
Single  texture,  woman's  coat. 


GOVERNMENT   CONTROL   OVER   PRICES.  467 

30.  Rubber  and  rubber  products  class  (24  series) — Continued. 

Rubber  products — Continued. 
Footwear,  rubber- 
Arctics. 

Boots. 
Tires  and  tubes,  rubber — 

Pneumatic  plain  tread,  30  by  3^  inches. 

Pneumatic  non-skid,  30  by  3£  inches. 

Pneumatic  non-skid,  33  by  4  inchea. 

Pneumatic  tubes,  33  by  4  inches. 

Solid  rubber  tire,  36  by  5  inches. 
Sundries,  druggists'— 

Ice  bags,  cloth  lined. 

Water  bottles  (all  rubber). 
Rubber  goods — 

Conveyor  belting,  8-inch,  5-ply. 

Water  hose,  £-inch,  5-ply. 

31.  Paper  class  (40  series): 

Paper — 

Nos.  1  to  20,  inclusive. 
Boards — 

Bogus  bristol. 

Chip. 

News. 

Plain. 

Straw. 
Paper — 

Blotting. 

Building,  red  rosin,  sized  sheeting. 

Tissue,  Manila. 

Wrapping,  Nos.  1  to  10,  inclusive. 

Writing,  bond,  No.  4. 

Writing,  coupon  bond,  No.  1. 

32.  Fibers  and  fiber  products  class  (34  series): 

Raw  materials — 
Fibers — 

American,  Kentucky,  double  dressed. 

Flax,  New  Zealand,  good,  fair  shipment. 

Istle,  Palma. 

Jute,  raw,  M,  double  triangle,  shipment. 

Sisal,  Mexican,  current  shipment. 

Sisal,  Java — A,  shipment. 
Manufactured  products — 
Cordage,  jute — 

Packing,  coarse. 

Papermaker's  twine. 

Rope,  No.  1,  £-inch  and  above. 

Rope,  No.  2,  £-inch  and  above. 

Twine,  wool,  A  quality. 

Twine,  wrapping,  2  to  6  ply. 

Twine,  wrapping,  hide  rope  form. 
Cord  and  twine — 

India,  dark  color,  No.  2. 

India,  dark  color,  No.  9. 


468  HISTORY   OF   PRICES   DURING   THE   WAR. 

32.  Fibers  and  fiber  products  class  (34  series) — Continued. 

Manufactured  products — Continued. 
Cordage,  hard  fiber — 

Manila  rope,  third-grade  basis. 

Pure  manila  rope,  basis  f -inch  diameter. 

New  Zealand  rope,  basis  f -inch  diameter. 

Russian,  tarred  basis. 

Sisal,  rope  basis. 
Hemp  and  twine — 

American,  mixed,  No.  9. 

American,  mixed,  No.  12. 

Pure,  No.  9. 

Pure,  No.  12. 
Oakum — 

Best. 

Plumbers'. 

United  States  Navy. 

Navy. 
Rope,  hard  fiber — 

Manila,  basis  price. 

Manila,  lariat. 

Oilwell  drilling  cables. 

Sisal,  basis,  f -inch  diameter. 

Transmission. 
Packing,  fine. 

METAL  GROUP. 

33.  Iron  and  steel  and  their  products  class  (52  series): 

Manufactures — 

Adzes,  carpenters'. 

Anvils,  American. 

Augers,  regular,  1-inch. 

Axes,  single-bit,  base  weight,  first  quality. 

Braces,  common  ball. 

Butts,  loose-pin,  wrought  steel,  3£  by  3^  inch. 

Carvers,  stag  handles,  8-inch. 

Chains,  traces,  wagon,  western  standard,  straight  with  ring. 

Chisels,  regular,  socket  firmer,  1-inch. 

Files,  8-inch,  mill  bastard,  Nicholson. 

Gimlets,  bits,  common  double  cut. 

Hammers,  Maydole,  No.  1£. 

Hammers,  farriers',  2^-pound,  turning. 

Hinges,  gate,  with  latch,  western. 

Hinges,  spring,  holdback,  cast-iron. 

Hods,  coal,  galvanized,  open,  17-inch. 

Hooks,  bush,  light. 

Hooks,  grass,  bent  shank. 

Hooks  and  eyes,  group  3,  No.  40|. 

Knives  and  forks,  cocobolo  handles,  metal  bolsters. 

Knobs,  door,  steel,  bronze  plated. 

Locks,  common  mortise,  knob  lock,  3^-inch. 

Locks,  padlocks. 

Lock  sets. 


GOVERNMENT   CONTKOL   OVER   PRICES.  469 

33.  Iron  and  steel  and  their  products  class  (52  series) — Continued. 

Manufactures — Continued . 

Pans,  dripping,  refrigerator,  galvanized,  16-inch. 

Planes,  Sargent,  No.  414  Jack. 

Pails,  galvanized,  light. 

Punches,  saddlers'  or  drive,  good. 

Rasps,  horse,  16-inch,  plain. 

Rings  and  ringers,  hog,  gray  iron. 

Rings  and  ringers,  bull  rings,  steel. 

Saws,  cross-cut,  Disston,  No.  2,  6-foot,  Champion  tooth. 

Saws,  hand,  Disston,  No.  8,  26-inch,  skewback. 

Shaves,  spoke,  iron. 

Shovels,  Ames,  No.  2. 

Spoons,  tinned,  iron,  table. 

Springs,  carriage,  black,  l|-inch  and  wider. 

Staples,  fence,  bright. 

Swages,  1-inch. 

Tongs,  18-inch,  blacksmiths'. 

Traps,  fly,  balloon,  glove  or  Acme. 

Trowels,  Johnson's,  brick,  10^-inch. 

Truck,  warehouse,  hand. 

Turns,  cupboard. 

Vises,  solid -box,  50-pound. 

Vises,  self-adjusting,  jaw  vises,  Prentiss  patent. 

Washers,  cast-iron,  £-inch,  barrel  lots. 

Wedges,  oil  finish. 

Wheelbarrows,  tubular  steel,  steel  tray. 

Wire,  clothes  line,  No.  20. 

Wire,  cloth  and  netting,  black. 

Wire,  cloth  and  netting,  standard  galvanized. 

34.  Nonferrous  metals  class  (11  series V. 

Antimony,  ordinary  brands. 
Brass — 

Sheets. 

Rods. 
Copper — 

Casting. 

Sheets. 

Wire. 
Lead- 
Sheet. 

Solder. 

Pipe. 

Tin,  pig,  straits. 
Zinc,  prime  western. 

35.  Rare  metals  class  (4  series) : 

Chromite,  40  per  cent  and  over 
Ferro  vanadium. 
Spiegel eissen,  20  per  cent. 
Tungsten  ore,  60  per  cent. 


470  HISTORY   OF   PRICES   DURING  THE   WAR. 

FUELS  GROUP. 

36.  Petroleum  and  petroleum  products  class  (22  series): 

Fuel  oil,  wholesale  markets — 

Tulsa,  Okla. 

Vinton,  La. 

Houston,  Tex. 

San  Francisco. 

Los  Angeles,  Calif. 
Gasoline,  tank  wagon — 

Baltimore. 

Chicago. 

Kansas  City. 

New  York. 

San  Francisco. 

Kerosene,  standard  white,  110  test. 
Kerosene,  tank  wagon — 

Baltimore. 

Chicago. 

Kansas  City. 

New  York. 

San  Francisco. 
Lubricating  oil — 

Dark,  steam  refined. 

Red  paraffin. 

Paraffin,  903  sp. 

Spindle  No.  150. 

Spindle  No.  200. 
Paraffin,  crude,  118  to  1,220. 

37.  Matches  class  (9  series): 

Best  and  cheapest. 

Japanese  safety,  extra  quality,  "Namco"  brand. 

Nitedal  brand,  safety. 

Standard,  No.  1. 

Standard,  No.  2. 

Standard,  No.  5. 

Safe  home. 

Searchlight. 

Strike-on-the-box. 

BUILDING  MATERIALS  GROUP. l 

38.  Clay  products  class  (13  series): 

Brick- 
Face,  building,  No.  1,  color  gray. 
Fire,  high-grade. 
Paving,  No.  1. 

Dinner  sets,  china,  commercial  grade. 

China,  decorated  in  cheap  standard  treatments. 

Ground  plastic. 

Kaolin,  refined  white. 

Pipe,  sewer,  salt-glazed,  fire-clay. 

1  This  group  includes  a  few  materials  which  are  not  strictly  building  materials,  such  as  china,  etc.,  but 
which  are  included  in  the  group  because  of  convenience  in  classification.  The  aggregate  importance  of 
these  materials  is  so  small,  however,  that  their  inclusion  has  a  negligible  influence  on  the  index  number. 


GOVERNMENT   CONTROL   OVER  PRICES.  471 

38.  Clay  products  class  (13  series) — Continued. 

Pipe,  sewer,  vitrified,  salt-glazed,  4-inch. 
Sanitary  ware,  white,  with  glazed  finish. 
Sinks,  kitchen,  porcelain. 
Stoneware,  Ohio  standard,  white  and  black. 
Tile,  drain,  4-inch. 

39.  Sand  and  gravel  class  (1  series): 

Railway  ballast. 

40.  Quarry  products  class  (15  series): 

Granite — 

Dark,  monumental. 

Light,  building,  light  blue. 

Building,  red,  white,  and  blue. 

Crushed,  No.  3£,  £  inch  to  £  inch. 

Monumental,  red  and  gray 

Paving  blocks. 
Limestone — 

Crushed,  for  furnace  flux. 

Crushed,  railway  ballast. 

Indiana  building,  buff,  rough  block. 
Lime,  in  bulk. 
Marble,  sawn. 

Slate,  green  roofing,  No.  1  grade,  20  by  10. 
Stone — 

Building,  gray  blockstone. 

Curbing,  4-inch  and  under. 

Flagging,  sawed. 

41.  Cement  class  (1  series): 

Natural  rock  cement. 

42.  Glass  class  (10  series) : 

Glass- 
Plate,  polished,  glazing  area  3  to  5  square  feet. 

Plate,  polished,  glazing  area  5  to  10  square  feet. 

Window,  single,  40-A. 

Window,  double,  40-A. 

Window,  single,  40-B. 

Window,  double,  40-B. 
Glassware — 

Milk  bottles,  glass. 

Nappies,  4-inch,  common. 

Pitchers,  ^-gallon,  common. 

Tumblers,  table,  J-pint. 

43.  Lumber  class  (38  series): 

Ash- 
Firsts  and  seconds,  4/4. 
No.  1  common,  4/4. 
No.  2  common,  4/4. 

Birch- 
Firsts  and  seconds,  4/4. 
No.  1  common,  4/4. 
No.  2  common,  4/4. 
No.  3  common,  4/4. 


472  HISTORY   OF   PRICES   DURING   THE   WAR. 

43.  Lumber  class  (38  series) — Continued. 
Chestnut — 

Firsts  and  seconds,  4/4. 

No.  1  common,  4/4. 

No.  3  common,  4/4. 

Sound,  wormy,  4/4. 
Gum — 

Firsts  and  seconds,  4/4,  red. 

Firsts  and  seconds,  4/4,  sap. 

No.  1  common,  4/4,  red. 

No-  1  common,  4/4,  sap. 

No.  2  common,  4/4. 
Hickory — 

No.  2  common,  8/4. 
Maple,  hard — 

Firsts  and  seconds,  4/4. 

No.  1  common,  4/4. 

No.  3  common,  4/4. 
Oak,  plain — 

Firsts  and  seconds,  4/4. 

No.  1  common,  4/4. 

No.  1  common. 

No.  3  common,  4/4. 
Poplar,  yellow — 

Firsts  and  seconds,  4/4. 

No.  1  common,  4/4. 

No.  2  common,  4/4. 

No.  1  common,  8/4. 

Saps  or  selects,  4/4. 
Pine,  eastern  white — 

Dimension:  No.  1,  S-l-S-L,  2  by  4  inches  by  16  feet. 

Dimension:  No.  1,  S-1-S-1L,  2  by  10  inches  by  16  feet. 

Inch  finish,  select,  1-inch. 

No.  2  boards,  1  by  8  inches  by  12  feet. 

No.  3  boards,  12  by  10  inches  by  20  feet. 

No.  4  boards,  mixed  widths,  10  to  20  feet. 

Selects,  C  and  better,  6/4  M-L. 

Shop,  No.  1,  8/4  M-L. 
Shingles,  red  cedar. 

•14.  Paints  and  varnish  class  (29  series): 
Paint  pigments — • 

Bone  black. 

Lamp  black. 

Prussian  blue. 

Chrome  green. 

Paris  green. 

Ochre. 

Venetian  red. 

Ultramarine. 

Umber. 

Chrome  yellow. 
Paints  and  pigments — 

Barytes,  domestic,  floated. 

Blanc  fixe,  pulp. 


GOVERNMENT   CONTROL   OVER   PRICES.  473 

44.  Paints  and  varnish  class  (29  series) — Continued. 

Paints  and  pigments — Continued. 

Lead- 
Basic,  sulphate. 
Basic,  carbonate,  dry. 
Red. 

Litharge. 

Lithophone. 

Paint,  outside  white. 

Whiting. 

Zinc  oxide. 

Paint  and  varnish,  raw  materials- 
Casein. 

Carnauba  wax. 

Copal  gum,  Manila 

Kauri  gum,  ordinary  chips. 

Oil,  china  wood. 

Oil,  linseed. 

Shellac,  T-N. 

Turpentine,  spirits  of. 

Varnish,  inside,  oil. 

THE  CHEMICALS  GROUP. 

45.  Mineral  acids  class  (2  series): 

Hydrocholoric  acid  (muriatic),  20°  Baume. 
Rock  salt,  crushed,  f.  o.  b.  car,  mines. 

46.  Heavy  chemicals  class  (6  series): 

Bicarbonate  of  soda,  commercial,  99.9  per  cent  pure. 

Caustic  potash  (potassium  hydroxide),  88-92  per  cent. 

Lime,  burnt,  in  bulk. 

Rock  salt,  crushed. 

Salt  cake  (sodium  sulphate),  unground,  spot. 

Sodium  sulphide,  60  per  cent. 

47.  Miscellaneous  inorganic  chemicals  class  (18  series): 

Alluminum  sulphate,  commercial. 

Barium  chloride,  white  crystals. 

Borax  (sodium  tetraborate),  crystals  and  granulated. 

Bromine. 

Calcium  carbide. 

Calcium  chloride. 

Copper  sulphate  (blue  vitriol). 

Ferrous  sulphate  (copperas,  sulphate  of  iron). 

Lead  acetate  (sugar  of  lead),  brown,  broken. 

Magnesium  sulphate  (epsom  salts),  technical. 

Mercuric  chloride  (bichloride  of  mercury,  corrosive  sublimate). 

Phosphorous,  yellow. 

Potassium  chlorate  crystals. 

Potassium  permanganate. 

Silver  nitrate  (lunar  caustic). 

Sodium  silicate  (water  glass,  40°  Baume"). 

Sodium  trio-sulphate  (hypo). 

Zinc  chloride. 


474  HISTORY   OF   PRICES   DURING   THE   WAR. 

49.  Soaps  and  glycerin  class  (9  series): 

Rosin,  grade  F,  280-pound  barrel. 
Soap- 
Toilet,  average  of  two  leading  brands.. 

White  floating,  Flotilla. 

White  floating,  Ivory. 

White  laundry,  Proctor  &  Gamble  white  naphtha. 

White  laundry,  crystal  white. 

Octagon. 

Yellow  rosin  laundry,  Lenox. 
Sodium  silicate. 

50.  Essential  oils,  flavoring  and  perfumery  materials  class  (20  series): 

Balsam,  Peru. 
Benzoin  gum,  Siam. 
Musk,  natural. 
Oils  of— 

Cassia. 

Bergamot. 

Cedar  leaf. 

Cedar  wood. 

Eucalyptus,  Australia. 

Lavender  flowers. 

Lemon. 

Neroli,  petale. 

Orange,  sweet,  Italian. 

Peppermint. 

Rose. 

Sassafras. 

Wintergreen  (sweet  birch). 

Wormwood. 
Orris  root,  Florentine. 
.Vanilla  beans. 
Vanillin. 

51.  Wood  distillation  products  and  naval  stores  class  (4  series): 

Acetic  acid,  28  per  cent,  in  barrels. 
Acetone  oil. 
Rosin,  grade  F. 
Turpentine,  spirits  of. 

52.  Natural  dyestuffs  and  tanning  chemicals  class  (18  series): 
Raw  materials — 

Divi-divi. 
Fustic  sticks. 

Gambier,  common  or  spot,  ex-store. 
Hemlock  bark. 
Logwood  sticks. 
Oak  bark. 

Sumac,  Sicily,  29  per  cent  tannin. 
Quercitron  bark. 
Manufactured  materials — 
Chestnut  extract. 
Dextrine,  domestic  potato. 
Fustic  extract,  solid. 

Hemlock  bark,  extract,  25  per  cent  tannin. 
Indigo,  Bengal. 
Logwood  extract,  solid. 


GOVERNMENT   CONTROL   OVER  PRICES.  475 

52.  Natural  dyestuffs  and  tanning  chemicals  class  (18  series) — Continued. 
Manufactured  materials — Continued. 

Oak  bark  extract. 
Quercitron  extract,  51°. 
Sodium  bichromate. 
Turkey  red  oil. 

53.  Coal  tar  crudes,  dyes  and  intermediates  class  (18  series): 

Coal  tar  crudes — 

Creosote  oil. 

Benzol,  pure  white. 

Napthaline,  refined  flakes. 

Solvent  naptha. 
Coal  tar  intermediates — 

Aniline  oil. 

Beta-napthol. 

Paranitraniline. 

Phenol,  U.  S.  P.  crystals  (carbolic  acid). 

Salicylic  acid. 
Coal  tar  dyes — 

Bismark  brown  (2R)  No.  284. 
\Chrysoidine  R  (No.  34). 

Chrysoidine  Y  (No.  33). 

Direct  black,  No.  462. 

Indigo,  synthetic,  No.  874. 

Nigrosine,  spirit  soluble,  blue  shade,  No.  698. 

Nigrosine,  water  soluble,  blue  shade,  No.  700. 

Orange  II  (No.  145). 

Scarlet,  2  R  (No.  82). 

54.  Drugs  and  pharmaceuticals  class  (27  series): 

Aspirin,  Bayer. 

Antipirine. 

Aloes,  cape. 

Acetphenitidin. 

Acetanilid,  C.  P. 

Belladonna  root. 

Bismuth  subnitrate. 

Castor  oil,  1,  or  AA. 

Cream  of  tartar  crystals. 

Cocaine  hydrochloride,  large  crystals. 

Citric  acid  crystals. 

Camphor,  Japanese  refined. 

Calomel,  U.  S.  P.  (mercurous  chloride). 

Digitalis,  domestic. 

Iodine,  resublimed. 

Lanolin,  anhydrous. 

Licorice  root. 

Menthol. 

Morphine  sulphate. 

Nux  Vomica. 

Opium  gum. 

Quinine  sulphate. 

Salol. 

Sodium  bromide,  granular. 

Strychnine  sulphate. 

Tartaric  acid,  crystals. 

Thymol. 


476  HISTORY   OF   PRICES   DURING   THE   WAR. 

55.  Proprietary  preparations  class  (23  series): 

An  antiseptic  wash. 

An  ant-acid. 

A  disinfectant. 

A  cathartic. 

A  digestive  remedy. 

Cough  remedy  No.  1. 

Cough  remedy  No.  2. 

A  facial  cream. 

A  hair  tonic. 

A  headache  remedy. 

Laxative — 

No.  1. 

No.  2. 

No.  3. 
Liniment — 

No.  1. 

No.  2. 

Mouth  wash. 
Prepared  food. 
Purgative. 
Salve. 

Talcum  powder. 
Tonic- 
No.  1. 

No.  2. 
Tea. 

56.  Explosives  class  (10  series): 

Commercial  explosives — 

Dynamite,  40  per  cent  N.  G. 

Dynamite,  40  per  cent  L.  F.  Am. 

Powder  F.  F.  F.,  black. 
Military  explosives — 

Ammonium  nitrate. 

Picric  acid. 

Powder — 

Smokeless,  foreign  cannon  (water  dried). 
Smokeless,  United  States  military  rifle  (air  dried). 

Phenol. 

Trinitrotoluol,  crude,  melting  point  76°. 

Trinitrotoluol,  refined,  melting  point  79.6°  to  80°. 

57.  Miscellaneous  organic  chemicals  class  (12  series): 

Ether. 

Hexainethylenetetramine. 

Hydroquinone. 

Lactic  acid,  22  per  cent. 

Oxalic  acid. 

Pyrogallic  acid. 

Solvents- 
Alcohol,  denatured. 
Alcohol,  grain,  190  proof. 
Amyl  acetate. 
Carbon  bisulphide. 
Chloroform. 
Fusel  oil,  amyl  alcohol. 


GOVERNMENT   CONTROL   OVER   PRICES.  477 

(3)  THE  SERIES  OF  THE  PRICE  SECTION  INDEX  NUMBER  CONSIDERED 

CONTROLLED. 

FOOD  GROUP. 

8.  Feed  and  forage  class  (22  series): 

Corn  chop. 

Corn — 

Kafir,  No.  3,  white. 
Mixed,  cash,  No.  3. 

Feed,  molasses  alfalfa. 

Meal- 
Alfalfa,  new  choice. 
Cottonseed. 
Linseed. 

Molasses,  black  strap. 

Hay- 
Alfalfa,  No.  2. 
Clover,  No.  1. 
Clover,  mixed,  No.  1. 
Johnson  grass,  No.  2. 
Prairie,  No.  2. 
Wild  oat. 
Choice,  tame  oat. 
Timothy,  No.  2. 
Fancy  wheat. 

Hulls,  cottonseed,  loose. 

Oats,  cash,  No.  3,  white. 

Straw- 
Oat. 
Rye. 
Wheat. 

9.  Wheat  and  wheat  products  class  (12  series): 

Biscuit,  social  tea. 

Bread,  loaf,  before  baking. 

Cake,  Regina,  pound,  raisin,  and  plain. 

Crackers — 
Graham. 
Soda,  in  boxes. 

Cream  of  wheat. 

Flour,  wheat,  standard  patents. 

Macaroni. 

Mill  feeds- 
Bran. 

Middling,  standard,  100-pound  jute  sacks. 
Shorts,  mixed. 

Wheat,  No.  2,  red  winter,  cash. 

10.  Corn  and  corn  products  class  (6  series): 

Corn,  yellow,  cash,  No.  3. 

Corn  meal,  white,  in  bulk. 

Corn  oil,  crude,  in  400-pound  barrels. 

Cornstarch,  powdered,  in  bags. 

Corn  sirup,  43°  crystal,  in  100-pound  barrels. 

Hominy  grits,  in  bulk,  carload  lots. 


478  HISTORY   OF   PRICES   DURING  THE   WAR. 

11.  Oats,  buckwheat,  and  rice  class  (9  series): 

Buckwheat. 

Flour- 
Aunt  Jemima  pancake. 
Buckwheat. 
Gold  medal. 
Teco  pancake. 

Oats,  No.  3,  white,  cash. 

Oatmeal,  carload  lots. 

Rice- 
Honduras  head,  domestic,  clean. 
Japanese  head,  domestic,  clean. 

12.  Barley,  hops,  rye,  and  their  products  class  (4  series): 

Barley,  fair  to  good. 

Malt,  western  grade,  standard. 

Rye,  No.  2,  Minneapolis. 

Rye  flour,  pure,  medium  straight. 

13.  Sugar  and  related  products  class  (9  series): 

Corn,  No.  3,  yellow. 

Glucose,  42°  mixing. 

Molasses,  fancy,  blended,  in  barrels. 

Sugar — 

Beet,  refined,  standard  granulated. 

Cane,  raw,  96°  centrifugal. 

Cane,  refined,  fine  granulated,  in  bags  or  barrels. 

Cane,  refined,  granulated,  in  cartons,  cased. 

Cane,  refined,  cubes,  in  barrels. 

Cane,  refined,  No.  7,  soft,  brown,  in  barrels. 

14.  Vegetables  and  truck  class  (15  series): 

Beans — 

Navy,  or  pea,  dried. 

Pinto,  dried. 

Dried,  unclassified. 
Cabbage — 

Fresh,  unclassified. 

Fresh,  white,  Danish. 
Corn,  New  York  standard,  canned. 
Onions,  fresh,  unclassified. 
Peas- 
Fresh,  shelled. 

Canned,  No.  3  sieve. 
Peanuts — 

Dried,  unclassified. 

Dried,  shelling  stock,  or  grade  No.  3. 
Potatoes — 

Fresh,  white,  unclassified. 

Fresh,  sweet,  unclassified. 
Tomatoes — 

Fresh,  canners'  stock. 

Canned,  standard. 

15.  Edible  vegetable  oils  class  (13  series): 

Beans,  soya. 

Butter,  cocoa,  in  bulk. 


/ 


GOVERNMENT   CONTROL   OVER  PRICES.  479 

15.  Edible  vegetable  oils  class  (13  series) — Continued. 

Cottonseed. 
Copra,  in  bags. 
Lard  substitutes,  in  barrels. 
Oil- 
Coconut,  crude,  in  tank  cars. 

Cottonseed,  crude,  in  tank  cars. 

Cottonseed,  prime,  summer  yellow,  in  barrels. 

Corn,  crude,  in  barrels. 

Corn,  refined,  in  barrels. 

Palm  kernel,  crude. 

Soya  bean,  crude,  in  barrels. 

Olive,  edible. 

16.  Fruits,  nuts  and  wine  class  (10  series): 

Apples — 

Average  of  all  varieties. 

Baldwin. 

Ben  Davis. 

Dried. 

Bananas,  Jamaica. 
Lemons,  California. 

Oranges,  California — Valencias  and  navels. 
Peaches,  dried,  California,  choice. 
Prunes,  dried,  California,  60-70. 
Raisins,  dried,  choice,  seeded. 
18.  Tea,  coffee,  and  cocoa  class  (9  series): 
Coffee- 
Caracas,  washed. 

Colombian,  Bogotas. 

Costa  Rica,  fair  to  good. 

Cucuta,  fair  to  good. 

Hayti,  unwashed. 

Mocha,  small. 

Padang,  interior. 

Rio,  No.  7. 

Santos,  No.  4. 

20.  Live  stock,  meats  and  fats  class  (48  series): 
Bacon — 

Short,  clear  sides,  smoked,  loose. 

Rough  sides,  smoked,  loose. 

Breakfast,  loose. 
Beef- 
Fresh  native  sides. 

No.  1  plate. 

Salt,  extra  mess. 
Cows,  choice  to  prime. 
Hams,  smoked,  loose. 
Heifers,  choice  to  prime. 

P— 

Dressed. 

Live,  bulk  of  sales. 

Live,  carload  lots. 

Live,  light  to  heavy. 

Heavy  fair  to  choice  heavy  shipping  and  heavy  butcher. 

Common  to  choice  light  bacon,  and  fair  to  fancy  select  butchers. 


480  HISTORY   OF  PRICES   DURING  THE   WAR. 

20.  Live  stock,  meats  and  fats  class  (48  series)— Continued. 

Lambs — 

Good  to  prime. 

Carload  lots. 
Lamb,  dressed,  round. 
Lard- 
Compound,  in  tierces. 

Leaf. 

Pure  leaf,  kettle  rendered,  tierces. 

Prime,  steam,  loose. 

Prime,  contract. 

Stearine. 

Margarine,  standard,  high-grade. 
Meat,  mutton,  dressed. 
Mutton,  legs. 
Pork  loins. 
Pork,  salt  mess. 
Sheep — 

Prime. 

Carload  lots. 

Ewes. 

Wethers. 

Oleomargarine,  standard,  uncolored,  pound  carton. 
Oleo  oil,  extra. 
Steers- 
Feeding,  790  to  839  pounds. 

Feeding,  940  to  989  pounds. 

Choice  to  prime,  heavy  beeves. 

Good  to  choice,  corn-fed. 

Native  beef. 

1,180  to  1,229  pounds. 

Good  native,  fresh  carcass. 
Steer- 
Chucks,  No.  1. 

Loins,  No.  1. 

Rounds,  No.  1. 
Tallow,  packers'  prime. 
Veal  calves,  prime,  live. 
Veal,  city  dressed,  good  to  prime. 

21.  Poultry  and  dairy  products  class  (43  series): 

Butter: 

Creamery — 

Extra,  San  Francisco. 

Extra,  Philadelphia. 

Seconds,  New  York. 

Firsts,  New  York. 

Fancy,  New  Orleans. 

Extra,  New  York. 

Elgin. 

Centralized  firsts,  Cincinnati. 

Firsts,  Chicago. 

Extra,  firsts. 

Extra,  Chicago. 

Seconds,  Boston. 

Extra,  Boston.* 


GOVERNMENT   CONTROL   OVER  PRICES.  481 

21.  Poultry  and  dairy  products  class  (43  series) — Continued. 

Butter — Continued . 

Whole  milk,  extra,  at  Cincinnati. 
Cheese- 
Whole  milk,  American  twins. 

New  York  State,  full  cream,  large  colored. 

Colored. 

California,  flats,  fancy. 

Flats,  average  and  fancy. 

Long  horn. 

Chickens,  broilers,  western,  combed. 
Ducks. 
Eggs- 

Average,  fresh,  best,  St.  Louis. 

Average,  best,  fresh,  New  York. 

Candled,  western,  New  Orleans. 

Firsts- 
Western,  Boston. 
Fresh,  Chicago. 
Fresh,  Cincinnati. 
Fresh  gathered,  New  York. 
Extra,  western,  Philadelphia. 
Selected,  pullets. 
Fowls — 

Live,  Chicago. 

Live,  choice,  New  York. 

Dressed,  western  killed,  corn  fed. 

Dressed,  western,  dry  picked,  and  packed. 
Turkeys- 
Dressed,  iced. 

Live. 
Milk- 
Fresh,  Chicago. 

Grade  B,  New  York. 

Fresh,  San  Francisco. 

Evaporated. 

Sweetened,  condensed. 
Oleomargarine. 

22.  Fish  and  oysters  class  (14  series): 

Bluefish. 
Carp. 
Cod. 

Flounder. 
Haddock. 
Hake. 

Halibut,  western  white. 
Herring,  lake. 
Mackerel,  Spanish 
Salmon. 

Salmon,  mild  cured. 
Salmon,  pink,  No.  1  tails,  canned. 
Sardines,  |-oils,  keyless,  canned. 
Trout,  lake. 
125547°— 20 31 


482  HISTORY   OF   PRICES   DURING  THE   WAR. 

CLOTHING  GROUP. 

23.  Cotton  and  cotton  products  class  (57  series): 
Cotton  goods: 

Damask,  bleached,  64-inch. 
Denim,  Amoskeag,  28-inch,  2.20-yard. 
Drilling,  Massachusetts  D  standard,  30-inch,  2.85-ounce. 
Duck- 
Sail,  numbered,  firsts,  22-inch,  No.  6. 

Standard,  United  States  Army,  firsts,  28^-inch,  8-ounce. 

Shelter  tent,  first  quality,  35£-inch,  1.90-yard. 

Wide,  numbered,  firsts,  60-inch,  No.  8. 
Cotton  linters — 

Grade  A,  cut  25-40. 
Grade  B,  cut  45-75. 
Grade  C,  cut  80-125. 
Grade  D,  cut  130-175. 
Cotton  manufactures — 

Bags,  2  bushel,  Amoskeag,  16-ounce. 

Blankets,  90-inch,  colored,  2  pounds  to  pair,  54  by  74. 

Calico,  American  standard,  28-inch,  64  by  64. 

Cambric,  Lonsdale. 

Cashmere,  cotton  warp,  36-inch. 

Cotton,  absorbent,  Maple  wood  grade. 

Flannels,  unbleached,  31^-inch,  3£  yards. 

Gauze,  bandage,  bleached,  36-inch,  20  by  12. 

Gauze,  Brunswick,  bleached,  36-inch,  20  by  12. 

Gingham,  Lancaster,  26J-inch,  6.5  yards. 

Lawn,  40-inch,  88  by  80,  8.5  yards. 

Mattress,  Anchor,  from  linters,  4/6  by  6/4,  45  pounds. 

Percale,  36  inches,  5.35  yards. 

Print  cloths — 

39-inch,  72  by  76,  4.25  yards. 

27-inch,  64  by  60,  7.60  yards. 
Sateen,  39-inch,  72  by  120,  3.50  yards. 
Sheeting — 

Brown,  36-inch,  44  by  48,  2.85  yards. 

Brown,  36-inch,  Ware  Shoals  LL,  4  yards. 

Bleached,  90-inch,  Wamsutta,  S.  T. 
Shirting — 

Bleached,  36-inch,  76  by  84,  3.90  yards,  in  gray. 

Muslin,  36-inch,  Rough  Rider,  4  yards. 
Rope,  first  grade,  1^-inch. 
Tape,  No.  7118,  60  by  38. 

Ticking,  Amoskeag,  A.  C.  A.  32-inch,  2.05  yards. 
Tire  fabric,  17^-ounce,  Egyptian,  carded. 
Thread,  cotton,  6-cord,  white,  200-yard  spool. 
Towels,  Terry,  22  by  44  and  83  by  32. 
Twill,  29.5-inch,  104  by  48,  2.15  yards, 
rwine,  wrapping,  first  grade. 
Seed,  cotton. 
Waste,  cotton,  Osnaburg. 


GOVERNMENT   CONTROL   OVER   PRICES.  483 

23.  Cotton  and  cotton  products  class  (57  series) — Continued. 

Cotton  manufactures — Continued . 
Yarns — 

Carded,  white,  northern  mule  spun,  22/1,  cones. 
Carpet,  short  staple,  8/3  warp,  twist  slack. 
Hosiery — 

Long  staple,  10/1,  combed,  C.  C.  hosiery,  twist,  cones. 
Short  staple,  30/1,  northern  carded,  double  roving  mule  spun. 
Weaving — 

Short  staple — 

10/1  carded,  white,  northern  mule  spun,  cones. 
16/2,  southern  2  ply  skein. 
Long  staple — 

24/1,  eastern  peeler  cones,  carded. 
36/1,  eastern  peeler  cones,  combed. 
50/2,  eastern  peeler  cones,  combed. 
60/2,  eastern  peeler  cones,  combed. 
70/2,  eastern  peeler  cones,  combed. 
80/2,  eastern  peeler  cones,  combed. 
Egyptian  twist,  60/1. 
Egyptian,  single,  70/1,  skeins,  combed. 
Sea  Island,  80/1,  combed. 

24.  Wool  and  woolen  products  class  (21  series): 

Raw  materials- 
Domestic  wool — 

Ohio,  fine,  unwashed,  delaine. 
Ohio,  three-eighths  blood,  unwashed. 
Ohio,  one-fourth  blood,  unwashed. 
Territory,  staple,  F.  and  F.  M.,  scoured  basis. 
Territory,  combing,  one-half  blood. 
Imported  wool — 

Adstralian,  choice  Sydney  and  Geelong,  merinos,  64s,  scoured  basis. 
Australian,  choice  Sydney  and  Geelong,  merinos  70s,  scoured  basis. 
Chinese,  China  ball,  No.  2,  open  grain  basis. 
South  American — 
Buenos  Aires — 

36s,  grain  basis,  28  per  cent  shrinkage. 
40/44  grain  basis,  30  per  cent  shrinkage. 
46s,  grain  basis,  34  per  cent  shrinkage. 
Montevideo — 

50s,  grain  basis,  35  per  cent  shrinkage. 
South  African — 

58/60s,  scoured  basis. 
60/64s,  scoured  basis. 
70s,  scoured  basis. 
Substitutes — 
Clips- 
Blue  worsted. 
Reworked  blue  serge. 
Rags,  graded — 
Blue  serge. 
Light  skirted  cloth. 
Light  worsted. 
Rags,  A  shoddy,  reworked  blue  serge. 


484  HISTORY   OF   PRICES   DURING   THE   WAR. 

25.  Silk  and  silk  products  class  (2  series): 

Waste  silk — 

Japan,  best  white  Prisons. 
Japan,  pierced  cocoons. 

26.  Hides  and  skins  and  their  products  class  ((!()  series): 

Cattle  hides- 
Country — 
Branded. 
Cows,  heavy. 

Steers,  No.  1,  GO  pounds,  and  up. 
Imported — 
Bogota. 
Vera  Cruz. 
Imported  dry — 
Packer. 

Puerto  Cabella,  21  to  23  pounds,  selected. 
Tuxpam,  20  to  27  pounds,  selected. 
Vera  Cruz,  18  to  19  pounds,  selected. 
Packer — 
Cows — 

Branded. 
Light  native. 

Native,  over  55  pounds. 
Steers- 
Butt  branded. 
Extreme  light  Texas. 
Heavy  native. 
Light  Texas. 
Spready. 
Calfskins— 
Country. 
Country  kips— 

Kips  No.  1,  15  to  25  pounds. 
Selected,  5  to  7  pounds. 
Selected,  7  to  9  pounds. 
Selected,  9  to  12  pounds. 
Green,  trimmed  to  butchers- 
No.  1. 
No.  2. 
New  England — 

4  to  5  pounds. 

5  to  7  pounds. 
7  to  9  pounds. 
9  to  12  pounds. 
12  to  16  pounds. 
16  pounds  and  up. 

Selected— 

5  to  7  pounds. 
7  to  9  pounds. 
9  to  12  pounds. 
Goatskins — 
Amritsars — 

1,000  pounds  to  500  skins. 
1,110  pounds  to  500  skins. 
1,200  pounds  to  500  skins. 


GOVERNMENT   CONTROL   OVER  PRICES.  485 

26.  Hides  and  skins  and  their  products  class  (60  series) — Continued. 
Goatskins — Continued . 
Brazil,  first  selection. 
Rio  Hache. 
San  Luis  Zacatecas. 
Sheep  and  lambskins- 
Country — 

Lambs. 

Sheep  and  shearlings. 
Imported — 

Capeskins,  glove. 

Lambs,  Greek  and  Macedonian. 

Lambskins,  Spanish. 

Mochas. 
Packer- 
Lambs. 

Sheep  and  shearlings. 
Horsehides,  country. 
Leather,  cattle  hide- 
Belting  butts — 

Light  standard  tannages. 

Heavy  standard  tannages. 

Medium  standard  tannages. 

No.  1  heavy. 
Harness  leather — 

Grade  B.     California  oak. 

Grade  2. 
Sole  leather — 

Buenos  Aires,  dry  hide,  hemlock.     M.  W.,  reject  second  grade. 

Buenos  Aires,  dry  hide,  hemlock,  O.  W.,  2d  grade. 

Hemlock  packer  slaughter,  No.  1. 

Hemlock  slaughter,  No.  1,  best  tannages. 

No.  1  scoured  oak  bends,  all  weights. 

No.  1  scoured  oak  backs,  all  weights. 

RUBBER,  PAPER,  AND  FIBERS  GROUP. 

30.  Rubber  and  rubber  products  class  (10  series): 

Rubber,  crude — 

African,  Niger  flake. 
Brazilian  Para- 

Cameta. 

LTpper  Caucho  Ball. 

Upriver,  coarse. 

Upriver,  fine. 
Centrals,  Guayule — 

Corinto  scrap. 

20  per  cent,  guaranteed. 
Plantation  Hevea — 

First  latex  crepe. 

Fine  smoked  sheets,  ribbed. 
Rubber  substitute — 
Gutta  joolatong. 

31.  Paper  class  (1  series): 

News  print  rolls,  car  lots. 


486  HISTORY   OF   PRICES   DURING  THE   WAR. 

32.  Fibers  and  fiber  products  class  (10  series): 

Raw  materials — 

Kapok,  prime  Japara. 
Manila — 

^air,  current  shipment. 

Good,  current  shipment. 

Midway,  bhipment. 
Manufactured  product — 
Binder  twine — 

Manila,  600  feet  to  the  pound. 

Pure  manila,  650  feet  to  the  pound. 

Standard  manila  or  extra,  550  feet  to  the  pound. 

Standard,  500  feet  to  the  pound. 

White  sisal,  500  feet  to  the  pound. 
Burlap,  40-inch,  lO^-ounce,  Calcutta. 

METALS  GROUP. 

33.  Iron  and  steel  and  their  products  class  (36  series) : 

Raw  materials  and  slightly  manufactured  products- 
Iron  ore — 

Mesabi  Bessemer,  55  per  cent. 
Mesabi  non-Bessemer,  51£  per  cent. 
Coke,  Connellsville  furnace,  f.  o.  b.  ovens. 
Pig  iron — 
Basic. 
Bessemer. 

Foundry,  No.  2  southern. 
Scrap,  steel — 

Heavy  melting. 
No.  1  railroad  wrought. 
Billets,  steel- 
Bessemer. 
Open-hearth. 
Bars- 
Iron,  common,  from  mill,  Pittsburgh. 
Sheet  steel,  Bessemer. 
Sheet  steel,  open-hearth. 
Steel. 

Shapes,  steel,  structural. 
Plates,  steel ,  tank . 
Manufactured  products — 
Rails,  steel — 

Bessemer,  standard. 
Open-hearth,  standard. 
Spikes,  steel- 
Standard  railroad. 
Skelp,  grooved. 
Pipe,  cast  iron,  6-inch. 
Hoops,  steel. 
Sheets- 
Black,  No.  28. 
Blue  annealed,  No.  10. 
Galvanized,  No.  28. 


GOVERNMENT    CONTROL   OVER    PRICES.  487 

33.  Iron  and  steel  and  their  products  class  (36  series) — Continued. 

Manufactured  products — Continued. 

Tin  plate,  domestic  coke,  14  by  20  inches. 

Wire  rods,  Bessemer. 

Wire  fence — 

Plain,  annealed,  Nos.  0  to  9. 
Barbed,  galvanized. 

Calk,  toe,  blunt  and  medium,  1  prong. 

Chains,  American  coil. 

Nails- 
Cut,  eightpenny,  fence  and  common. 
Wire,  eightpenny,  fence  and  common. 

Rivets,  button  head,  structural. 

Screws,  wood,  1-inch,  No.  10,  flat  head. 

Shoes,  horse  and  mule. 

34.  Ferro-alloys,  nonferrous  and  rare  metals  class  (13  series): 

Aluminum — 

98  to  99  per  cent,  contract  price. 

98  to  99  per  cent,  open  market. 
Copper — 

Electrolytic. 

Lake. 
Lead,  pig. 
Nickel,  ingot. 
Nickel,  shot  and  ingot. 
Zinc,  sheet. 
Quicksilver. 

Ferromanganese,  80  per  cent. 
Manganese  ore,  49  per  cent. 
Platinum,  refined  ingots. 
Silver,  fine. 

FUELS  GROUP. 

35.  Coal  and  coke  class  (27  series) : 

Coal- 
Anthracite,  f.  o.  b.  New  York — 

Chestnut. 

Egg- 

Pea. 

Steam. 

Stove. 
Bituminous  (districts  in  which  produced) — 

Cartersville  and  Franklin,  111.  (2  series). 

Clinton,  111.  (2  series). 

Eastern  Kentucky  (2  series). 

Georges  Creek,  Md.  (2  series). 

Hocking,  Ohio  (2  series). 

Mount  Olive,  111.  (2  series). 

Pittsburgh,  No.  8,  Ohio  (2  series). 

Springfield,  111.  (2  series). 

Standard,  111.  (2  series). 

Western  Kentucky  (2  series). 
Coke-y 

Birmingham. 
Connellsville. 


488  HISTORY   OF   PRICES   DURING    THE   WAR. 

36.  Petroleum  and  petroleum  products  class  (5  series) : 
Crude  petroleum — 

California,  at  wells. 

Gulf,  barrel,  42-galkm,  at  wells. 

Illinois. 

Mid-continent. 

Pennsylvania. 

BUILDING  MATERIALS  GROUP. 

38.  Clay  products  class  (3  series): 

Brick,  common. 

Tile- 
Hollow,  building. 
Hollow  blocks,  standard  size. 

39.  Sand  and  gravel  class  (8  series): 

Sand- 
Building. 

Building,  coke  and  engine. 

Fine  building. 

Foundry. 

Fire  and  furnace. 

Glass. 

Molding. 
Gravel. 
41.  Cement  class  (6  series): 

Cement,  Portland  (markets) — 

New  York. 

New  England  and  Middle  States. 

Illinois. 

Indiana. 

Ohio,  Indiana,  Illinois,  and  Michigan. 

Western  Washington . 
43.  Lumber  class  (24  series) : 
Douglas  fir — 

Is  and  2s,vl-inch. 

No.  2  and  better,  drop  siding,  1/6. 

No.  1  common,  SIS,  1  by  8  inch  and  10-inch. 

Is  and  2s,  2-inch. 
Hemlock,  eastern — 

No.  1  boards,  SIS,  1  by  8  inch  by  16  feet. 

No.  1  fencing,  SIS,  1  by  16  inch. 

No.  1  piece  stuff,  S1S1E,  2  by  4  inch  by  16  feet. 

Timbers,  rough,  4  by  4  inch  to  8  by  8  inch  by  16  feet. 
Pine,  southern  yellow — 

Finish  B  and  better,  6-inch  and  wider. 

Common  boards,  No.  1,  S2S,  1  by  10  inch. 

Common  boards,  No.  2,  S2S,  1  by  8  inch. 

No.  1,  S1S1E,  2  by  8  inch  by  16  feet. 

Timbers,  S1S1E,  6  by  8  inch  by  16  feet. 
Spruce — 

Boards — 

Covered,  5-inch  and  up. 
Matched. 


GOVERNMENT   CONTROL   OVER   PRICES.  489 

43.  Lumber  class  (24  series) — Continued. 

Spruce — Continued. 

Bundled  furring,  2-inch. 
Frames — 

8-inch  and  under. 

9-inch  and  under. 

10-inch. 

11  or  12  inch. 
Random — 

2  by  3;  2  by  4. 
2  by  8. 
2  by  10. 
2  by  12. 

44.  Paints  and  varnishes  class  (1  series): 

Soya  bean  oil . 

CHEMICALS  GROUP. 

45.  Mineral  acids  class  (6  series): 

Nitrate  of  soda,  95  per  cent. 
Nitric  acid,  42°  Baume. 
Pyrites,  urn  size,  lump  ore  wash. 
Sulphuric  acid — 

60°  Baume". 

66°. 
Sulphur,  brimstone,  stick,  crude. 

46.  Heavy  chemicals  class  (3  series) : 

Bleaching  powder,  35  per  cent  chlorine. 
Caustic  soda,  76  per  cent,  spot. 
Soda  ash,  light,  58  per  cent,  spot. 

47.  Miscellaneous  inorganic  chemicals  class  (2  series): 

Ammonia,  liquid  anhydrous,  in  cylinders. 
Arsenic,  white. 

48.  Fertilizers  class  (25  series) : 

Acid  phosphate,  16  per  cent  phosphoric  acid. 

Bones — 

Raw  ground,  4  per  cent  ammonia  and  50  per  cent  bone  phosphate. 
Ground,  steamed,  1£  per  cent  ammonia  and  60  per  cent  bone  phosphate. 

Carbonate  of  potash,  calcined,  80  to  85  per  cent. 

Cottonseed  meal. 

Cyanamid,  22  per  cent  ammonia. 

Dried  blood,  12  to  13  per  cent  ammonia. 

Fish  scrap,  dried,  11  per  cent  ammonia,  and  14  per  cent  bone  phosphate. 

Hoofmeal. 

Kainit. 

Manure  salt. 

Manure  salt,  double,  48  to  53  per  cent  basis. 

Muriate  of  potash,  80  to  85  per  cent. 

Nitrate  of  soda,  95  per  cent. 

Sulphate  of  ammonia. 

Sulphate  of  potash,  90  to  95  per  cent. 

Tankage- 
Garbage. 

Slaughterhouse,  concentrated,  14  to  15  per  cent  ammonia. 
Slaughterhouse,  crushed,  9  and  20  per  cent. 


490  HISTORY   OF   PRICES   DURING  THE  WAR. 

48.  Fertilizers  class  (25  series) — Continued. 

Phosphate  rock — 

Florida,  high  grade,  hard,  77  per  cent. 

Florida  land  pebble,  68  per  cent. 

Tennessee,  domestic,  78  to  80  per  cent. 
Pyrites,  urn  size,  lump  ore  wash. 
Sulphuric  acid,  60°. 
Sulphur,  brimstone,  stick,  crude. 

49.  Soaps  and  glycerin  class  (21  series): 

Fats  and  oils — 

Degras,  American. 
Grease — 

Brown. 

House. 
Oil- 
Coconut,  domestic,  in  tanks. 

Corn,  crude,  in  barrels. 

Cottonseed,  crude,  in  tank  cars. 

Menhaden,  southern. 

Palm,  Lagos. 

Red. 

Soya  bean. 

Whale,  natural,  winter. 

Olive. 
Soapstock,  cottonseed  oil,  loose — 

65  per  cent  f .  a. 

50  per  cent  f.  a. 
Stearine— 

White  grease,  loose. 

Yellow  grease,  loose. 
Tallow- 
Packers',  No.  1. 

Packers',  No.  2. 
Other  materials — 
Caustic  soda. 
Glycerine — 

Dynamite,  carload  lots,  drums  included. 
C.  P.,  in  bulk. 

51.  Wood  distillation  products  and  naval  stores  class  (5  series): 

Acetone. 

Acetate  of  lime. 

Alcohol,  wood,  refined,  95  per  cent. 

Methyl  acetone. 

Ethyl  methyl  ketone. 

52.  Natural  dyestuffs  and  tanning  chemicals  class  (1  series): 

Quebracho,  extract,  solid. 

53.  Coal  tar  crudes,  intermediates  and  dyes  class  (1  series): 

Toluol,  pure. 
56.  Explosives  class  (9  series): 

Aqua  ammonia,  20  per  cent. 
Cotton  linters. 
Glycerine,  dynamite. 
Nitrate  of  soda,  95  per  cent. 


GOVERNMENT   CONTROL  OVER  PRTCES.  491 

56.  Explosives  class  (9  series) — Continued. 

Nitric  acid,  42°  Baume. 

Powder,  smokeless,  Army  and  Navy,  cannon,  air  dried. 

Powder,  smokeless,  American,  cannon,  water  dried. 

Sulphuric  acid,  66°  Baume. 

Toluol. 

57.  Miscellaneous  organic  chemicals  class  (2  series): 

Carbon  tetrachloride. 
Formaldehyde. 

3.  THE    CHAIN    INDEXES    OF    CONTROLLED    AND   UNCON- 
TROLLED PRICES. 

Perhaps  no  statistical  measure  is  more  significant  for  making 
broad  economic  interpretations  of  the  effects  of  price  control  upon 
war-time  prices  than  a  series  of  controlled  and  uncontrolled  price 
index  numbers.  The  outstanding  shortcoming  of  such  index  num- 
bers is,  however,  that  no  single  device  can  be  made  to  answer  sev- 
eral general  queries  with  accuracy.  The  so-called  controlled  index 
number  for  the  period  1913-1918  by  necessity  includes  commodities 
as  controlled  from  the  beginning  of  1913,  while  none  were  actually 
controlled  until  August,  1917,  and  while  all  did  not  come  under  con- 
trol until  the  signing  of  the  armistice.  It  is,  therefore,  an  excellent 
measure  of  the  war-time  price  movement  of  the  so-called  controlled 
commodities  or  the  uncontrolled  commodities,  but  a  crude  measure 
of  the  immediate  effects  of  each  regulation  as  it  came  on.  To  show 
these  effects  more  accurately,  there  has  been  devised  a  chain  index 
of  controlled  prices  showing  each  month,  for  all  prices  under  control 
by  the  end  of  the  month,  the  per  cent  of  rise  or  fall  from  the  prices 
of  the  identical  commodities  in  the  month  preceding.  There  has 
been  made,  too,  a  like  chain  of  uncontrolled  prices.  This  schedule 
permits,  by  reason  of  its  changing  base,  the  gradual  transfer  of  com- 
modities from  the  uncontrolled  list  to  the  controlled  list.  The  con- 
trolled list,  which  increases  from  month  to  month,  and  the  uncon- 
trolled list,  which  decreases  in  exact  degree,  are  thus  strictly  accu- 
rate for  each  month.  There  is,  so  far  as  known,  no  more  precise 
statistical  measure  of  the  immediate  effects  of  regulation  upon 
prices  than  the  chain  index  of  controlled  and  uncontrolled  commodi- 
ties constructed  here.1 

1  The  task  of  constructing  a  chain  index  of  1,366  commodities  from  April,  1917,  to  December,  1918,  in 
view  of  the  volume  of  transfers  from  the  uncontrolled  to  the  controlled  list  after  September,  1917,  was  a 
prodigious  one.  It  involved  the  separate  handling  of  thousands  of  8  and  9  figure  aggregates,  which  do 
not  show  in  the  completed  index,  anew  each  month.  Some  few  liberties  were  necessarily  taken,  and  com- 
binations of  series  were  sometimes  entered  together  during  the  same  month  in  order  to  reduce  the  calcu- 
Jations  involved.  These  few  cases  were  considered  with  care,  however,  andi  t  is  believed  that  the  general 
result  is  as  satisfactory  as  any  that  could  be  made.  The  chronological  order  in  which  commodities  were 
transferred  from  the  uncontrolled  to  the  controlled  list  follows: 

1917. 

September.— Coal,  coke,  copper,  wheat,  iron  ore,  pig  iron,  steel  bars,  steel  shapes,  steel  plates. 

October.— Steel  blooms  and  billets  , sheet  bars  ,wire  rods,  skelp,  sugar. 

November.— Steel  sheets,  pipe,  steel  scrap,  tinplate,  lead,  corn,  oats,  barley,  fresh  vegetables,  vegetable 
oils,  live  stock,  poultry,  fish,  fresh  fruits,  southern  or  yellow  pine,  ammonia,  smokeless  cannon  powder. 

December. — Douglas  fir,  wood  distillation  products,  cement,  remainder  of  iron  and  steel  class. 


492 


HISTORY  OF  PRICES  DURING   THE   WAR. 


The  chain  index,  which  was  made  simply  to  find  whether  Govern- 
ment regulation  affected  current  war  prices,  was  made  to  begin  in 

April,  1917.  The  "all 
commodities"  chain 
index,  and  that  for 
each  group  and  class 
figured,  contains  its 
full  lot  of  commodi- 
ties from  the  month 
of  our  entrance  into 
war  until  the  first 
month  of  regulation. 
The  whole  lot  of  com- 
modities were  then 
separated,  more  and 
more  each  month  as 
regulation  was  ex- 
tended, into  those 
controlled  and  un- 
controlled. The  "all 
commodities'7  chain 
index  in  April,  1917, 
for  example,  contains 
1,366  commodities. 
But  regulation  soon 
began  and  in  Sep- 
tember the  commodi- 
ties were  separated 
into  50  controlled  and 
1,316  uncontrolled . 

Weighted  chain  index  for  prices.— "All  commodities'' (1.366 series)     r^      i  fi        fi 

controlled  and    uncontrolled  during  the  war,  showing  changes  as     -^aC 
control  is  extended.     (Controlled,  0-573  series;  uncontrolled,  1,366-     after,  Until   the  C6SSa- 

tion  of  hostilities,  the 

extension  of  regulations  necessitated  the  transfer  of  certain  series 
from  the  uncontrolled  list  to  the  controlled  list.  By  October,  1918, 
the  original  1,366  uncontrolled  commodities  had  been  separated  into 
573  controlled  series  and  793  uncontrolled  prices. 

1918. 

January.— Nitrate  of  soda,  all  fertilizers  excepting  sulphur  and  sulphuric  acid. 
February. — Zinc,  formaldehyde,  toluol,  arsenic,  animal  feeds,  coffee. 
March. — Aluminum,  binder  twine,  marula  fiber. 

April. — Spruce,  hemlock,  nickel,  quicksilver,  silver,  newsprint  paper,  caustic  soda,  soda  ash,  bleaching 
powder,  carbon  tetrachloride. 

May.— Wool,  hides  and  skins,  rubber,  platinum  metals,  manganese  ore,  cotton  linters,  quebracho. 

June. — Sulphuric  acid,  nitric  acid,  sulphur,  harness  leather. 

July. — Cotton  goods  and  cotton  yarns,  brick,  building  tile,  sand  and  gravel. 

August.— Woolen  rags,  glycerin,  sole  and  belting  leather,  crude  petroleum,  kapok. 

September.— Silk  waste. 

October.— Burlap. 


5 
5 
5 

WEIGHTED  CHAIN  INDEX  FOR  PR1CE5  Of 

ALL  COMMODITIES 

136G  3EB1ES~ 

CONTROLLED  6,  UNCONTROLLED 
DURING  THE  WAR 
SHOWING  CHANGES  AS  C.ONTROL  15  EXTENDED 

CONTROLLED          0^573  5CRJC5 
««   UNCONTROLLED    1366™  793  3CR1C3 

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5 
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5 
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1917                1                      191& 

GOVERNMENT   CONTROL   OVER  PRICES.  493 

To  repeat,  the  chain  index  of  controlled  and  that  of  uncontrolled 
commodities  for  each  class  figured,  each  group,  and  "all  commodi- 
ties/' represents  a  series  of  percentages  of  the  aggregate  rise  or  fall 
each  month  by  comparison  with  prices  of  the  identical  commodities 
during  the  preceding  month.  For  example,  when  16  additional  series 
were  brought  under  control  in  October,  1917,  they  were  not  compared 
simply  with  the  50  series  that  made  up  the  list  of  controlled  commodi- 
ties for  September.  But,  in  order  to  be  strictly  accurate,  new  Sep- 
tember aggregates  were  figured  for  September  using  the  whole  66 
series  which  by  the  end  of  October  were  under  control.  It  was  thus 
found  that  the  weighted  prices  of  the  66  series  under  control  during 
October,  by  reason  presumably  of  extended  regulation,  fell  14.78  per 
cent  below  the  corresponding  66  price  series  for  September,  when 
only  50  of  them  were  regulated.  And,  by  the  same  process,  it  was 
found  that  the  remaining  1,300  series  still  uncontrolled  in  October, 
rose  1.11  per  cent  above  their  own  level  for  September.  Each  con- 
trolled commodity  was  taken  out  of  the  uncontrolled  list  and  put  into 
the  controlled  list  in  the  month  when  control  began.  The  chain  index 
of  controlled  commodities  throughout,  therefore,  is  a  comparison  of 
prices  during  the  month  when  regulation  began  with  the  prices  of 
identical  commodities  in  the  month  before,  and  the  uncontrolled 
index  is  a  comparison  of  prices  still  uncontrolled  by  the  end  of  each 
month  with  identical  series  for  the  month  preceding.1 

The  1,366  commodities,  which  went  into  the  "all  commodities'' 
chain  index,  each  month  rose  steadily  higher  than  their  level  of  the 
month  before  until  August,  1917.  And  from,  September  on  until  the 
signing  of  the  armistice  the  commodities  that  were  not  under  control 
moved  steadily  upward  in  price.  But  each  month  some  of  these  un- 
controlled commodities  were  put  under  regulation  and  there  is  a 
marked  difference  in  the  behavior  of  the  chain  index  of  controlled 
commodities.  The  Government  had  begun  to  control  prices  in  earnest 
by  September,  and  the  September  controlled  prices  fell  8.05  per  cent 
below  their  own  August  level  while  those  under  control  in  October 
fell  14.78  per  cent  below  their  own  September  level.  It  is  of  especial 
note  that  while  the  uncontrolled  index  continued  upward  from  our 
declaration  of  war  to  the  signing  of  the  armistice,  the  controlled  index 
made  an  enormous  drop  at  the  beginning  of  control,  and  from  No- 
vember, 1917,  held  relatively  stable. 

The  behavior  of  the  food  group  chain  index,  significantly,  is  very 
like  that  of  "  all  commodities  "  in  which  it  has  a  large  weighting.  The 
clothing  group  chain  index  shows  that  the  controlled  series  went 
somewhat  higher  in  their  monthly  rises  between  May  and  September, 

1  A  fuller  commercial  description  of  each  of  the  above  series  of  commodities,  which  were  all  taken  from 
the  Price  Section  index  number,  may  be  had  by  a  study  of  the  list  of  controlled  commodities  selected 
previously  for  the  controlled  index  number. 


494  HISTORY   OF   PRICES  DURING   THE   WAR. 

1918,  than  those  not  under  control,  and  then  fell  below.  The  out- 
standing features  of  the  chain  index  for  the  metals  group  are  the  extent 
to  which  prices  were  scaled  from  previous  heights  and  the  strength 
with  which  they  were  held  afterward.  Metal  prices,  in  September, 
1917,  were  brought  9.32  per  cent  below  their  August  level;  in  October 
they  were  brought  24.82  per  cent  below  their  September  level;  and 
in  November  they  were  brought  9.68  per  cent  below  their  October 
level.  Metal  prices,  once  reduced  to  this  lower  level,  show  scarcely 
the  variation  of  1  per  cent  up  to  the  signing  of  the  armistice.  The 
fuels  group  chain  index  shows  a  fairly  stable  price  movement  except 
for  the  enormous  increase  of  20.9  per  cent  in  April,  1918,  the  beginning 
of  the  new  "coal  year"  when  the  annual  contracts,  under  which  a 
very  large  proportion  of  all  coal  mined  is  sold,  were  reversed. 


GOVERNMENT   CONTROL   OVER   PRICES. 


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HISTORY   OF   PRICES   DURING    THE   WAR. 


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HISTORY  OF  PRICES  DURING  THE  WAR. 


CHAIN  INDEX  OF  CONTROLLED  AND  UNCONTROLLED  PRICES. 
[Showing  weighted  rise  or  fall,  by  per  cents,  of  controlled  and  uncontrolled  prices  for  each  month  of  the  war.] 


All  commodities. 

Food  group. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

1366 
1366 
1366 
1366 
1366 
1316 

1300 
1100 
1072 

1048 
1014 
1004 

979 
897 
885 
821 
796 
794 

793 
793 
793 

1917. 

April  with  March.. 
May  with  April.... 
June  with  May  
July  with  June  
August  with  July  .  . 
September      with 
August. 
October  with  Sep- 
tember. 
November       with 
October. 
December       with 
November. 

1918. 

January  with  De- 
cember, 1917. 
February  with  Jan- 
uary. 
March   with   Feb- 
ruary. 
April  with  March. 
May  with  April... 
June  with  May  
July  with  June  — 
August  with  July  . 
September      with 
August. 
October  with  Sep- 
tember. 
November       with 
October. 
December        with 
November. 

+9.73 

+4.44 



268 
268 
268 
268 
268 
256 

247 
83 
83 

83 
54 
54 

54 
54 
54 
54 
54 
54 

54 
54 
54 

1917. 

April  with  March  .  . 
May  with  April 



+  13.21 
+  7.38 
-    .79 
+  4.20 
-  1.35 
+  4.75 

+  1.92 
+10.24 
+  3.35 

+    .45 
+     .36 
+     .40 

+  2.33 
+  1.53 
+  4.36 
-    .15 
-    .04 
+    .52 

+    .66 
+  3.59 
+    .42 



+4.13 
+4.23 
—  1.61 

June  with  May 

July  with  June. 

August  with  July 

50 
66 
266 
294 

318 
352 
362 

387 
469 
481 
545 
570 
572 

373 
573 
573 

-8.05 
-14.  78 
-    .12 
-4.60 

+  1.25 
+  1.66 
-    .90 

-  1.53 
-  2.22 
-  1.45 

+  2.83 
+  2.25 
+  2.43 

-1.63 
-    .27 
+  2.06 

+  1.94 
+  1.11 
+3.64 
+1.75 

+1.72 

+  .98 
+1.66 

+3.30 

+  .74 
+  1.42 
+  1.42 
+  .50 
+2.08 

+  .51 
-  .49 
-1.04 

12 
21 

185 
185 

185 
214 
214 

214 
214 
214 
214 
214 
214 

214 
214 
214 

September      with 
August. 
October  with  Sep- 
tember. 
November       with 
October. 
December       with 
November. 

1918. 

January  with  De- 
cember. 1917. 
February  with  Jan- 
uary. 
March   with    Feb- 
ruary. 
April  with  March.. 
May  with  April  
June  with  May  
July  with  June  
August  with  July  .  . 
September      with 
August. 
October  with  Sep- 
tember. 
November       with 
October. 
December        with 
November. 

-7.19 
-1.95 
+1.83 
-5.77 

+1.46 
+1.99 
-1.17 

-2.83 
-3.24 
-1.85 
+4.05 
+3.03 
+3.80 

-2.48 
-  .53 
+4.00 

Clothing  group. 

Rubber,  paper,  and  fiber  group. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

409 
409 
409 
409 
409 
409 

409 
409 
409 

409 
409 
409 

409 
342 
340 
287 
271 
269 

269 
269 
269 

1917. 
April  with  March  .  . 

+3.36 
+2.07 
+4.15 
+6.41 
+  1.58 
+  .03 

119 
119 
119 
119 
119 
119 

119 
119 
119 

119 
119 
111 

110 
100 
100 
100 
99 
99 

98 
98 
98 

1917. 
April  with  March  .  . 

+2.59 
+  1.65 
-  .23 
-1.76 
-  .18 
+4.16 

-  .36 
-  .49 
-  .45 

+2.16 
0.00 
+  .92 

+4.23 
+4.54 
+  1.70 
-  .61 
+  .92 
-  .02 

+  .23 
-  .03 
-  .73 

May  with  April 

May  with  April 

June  with  May 

June  with  May 

July  with  June.. 

July  with  June..  .  . 

August  with  July  .  . 
September      with 
August. 
October  with  Sep- 
tember. 
November       with 
October. 
December       with 
November. 

1918. 

January  with  De- 
cember, 1917. 
February  with  Jan- 
uary. 
March   with   Feb- 
ruary. 
April  with  March 





August  with  July 

September      with 
August. 
October  with  Sep- 
tember. 
November       with 
October. 
December        with 
November. 

1918. 

January  with  De- 
cember, 1917. 
February  with  Jan- 
uary. 
March   with    Feb- 
ruary. 
April  with  March.  . 
May  with  April.... 
June  with  May  
July  with  June  
August  with  July  .  . 
September      with 
August. 
October  with  Sep- 
tember. 
November  with  Oc- 
tober. 
December  with  No- 
vember. 

+  .85 

+4.01 

+1.51 

+3.20 
+1.11 

+2.01 

+3.95 
-  .39 
+  .92 
+2.78 
+  .13 
+3.81 

+  .54 
-1.78 
-1.78 

8 

9 
19 
19 
19 
20 
20 

21 
21 
21 

-0.26 

+  .70 
+4.93 
+  .11 
+  .(« 
-1.14 
+  .05 

-4.41 
-2.  42 
-2.63 

67 
69 
122 
138 
140 

140 
140 
140 

May  with  April.... 
June  with  May  
July  with  June  
August  with  July  .  . 
September      with 
August. 
October  with  Sep- 
tember. 
November  with  Oc- 
tober. 
December  with  No- 
vember. 

+4.89 
+  .38 
+  .87 
+  .69 
-3.16 

+  .45 
-  .23 
-1.26 

GOVERNMENT   CONTROL  OVER  PRICES. 


501 


CHAIN  INDEX  OF  CONTROLLED  AND  UNCONTROLLED  PRICE S-Continued. 
[Showing  weighted  rise  and  fall,  by  per  cents,  of  controlled  and  uncontrolled  prices  for  each  month  of  the  war.] 


Metals  group. 

Fuels  group. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

1917. 

1917. 



116 
116 
116 
116 

April  with  March 

+  5.22 

63 
63 
63 
63 

April  with  March 

+  17.83 
+  3.96 

+     .72 
—  1.67 

May  with  April 

+  6  53 

May  with  April.... 
June  with  May...  . 

June  with  May..   .  . 

+  14.15 

July  with  June  

+  5.59 

July  with  June 

116 

August  with  July 

-  6.14 

63 

August  with  July 

+     .24 

11 

105 

September       with 

-  9.32 

-  9.46 

27 

36 

September      with 

-  6.07 

+  5.05 

August. 

August. 

18 

98 

October  with  Sep- 

-24.82 

-4.83 

27 

36 

October  with  Sep- 

-    .20 

+     .17 

tember. 

tember. 

26 

90 

November  with 

-  9.68 

-  3.00 

27 

36 

November  with 

+  2.6S 

+     .68 

October. 

October. 

39 

77 

December  with  No- 

-    .39 

-  1.25 

27 

36 

December  with  No- 

+    .70 

+  1.96 

vember. 

vember. 

1918. 

1918. 

39 

77 

January  with  De- 

+    .16 

-     .95 

27 

36 

January  with  De- 

+    .88 

+  3.52 

cember,  1917. 

cember,  1917. 

40 

76 

February  with  Jan- 

+    .39 

-  1.14 

27 

36 

February  with  Jan- 

+    .19 

+  1.17 

uary. 

uary. 

42 

74 

March  with  Febru- 

-   .15 

+  1.99 

27 

36 

March  with  Febru- 

+    .56 

+  1.37 

46 

70 

ary. 
April  with  March   . 

-     .40 

-  1.07 

27 

36 

ary. 
April  with  March.. 

+20.90 

+  3.47 

49 
49 

67 
67 

May  with  April..  . 
June  with  May...  . 

+     .07 
+     .22 

+  4.09 

+     .98 

27 

27 

36 
36 

May  with  April  
June  with  May  

+  1.13 
-  2.39 

+  3.46 

+     .87 

49 

67 

July  with  June.  .  .   . 

+     .86 

+  3.35 

27 

36 

July  with  June  

-     .16 

-     .48 

49 
49 

67 
67 

August  with  July   . 
September  with 

+     .47 
+     .01 

+  5.13 
-     .40 

32 
32 

31 
31 

August  with  July.. 
September  with 

+     .34 
+  1.17 

+     .15 

+     .45 

August. 

August. 

49 

67 

October  with  Sep- 

+ 1.10 

-     .60 

32 

31 

October  with  Sep- 

0.00 

0.00 

tember. 

tember. 

49 

67 

November   with 

+    .11 

-  1.81 

32 

31 

November  with 

+  2.53 

-  1.56 

October. 

October. 

49 

67 

December    with 

—  2.61 

-     .51 

32 

31 

December    with 

0.00 

-     .08 

November 

November. 

Building  materials  group. 

Chemicals  group. 

Con- 

Un- 

Con- 

Un- 

Con- 

Un- 

Con- 

Un- 

trolled 

con- 
trolled 

Comparison. 

trolled 

con- 
trolled 

trolled 

con- 
trolled 

Comparison. 

trolled 

con- 
trolled 

series. 

series. 

prices. 

prices. 

series. 

series. 

prices. 

prices. 

1917. 

1917. 

149 

April  with  March 

+  10.40 

242 

April  with  March 

+2.47 

149 

May  with  April. 

+  1  58 

242 

May  with  April 

+6.46 

149 
149 

June  with  May 

+  1  65 

242 

242 

June  with  May.. 

+2.00 

+2.65 

July  with  June 

+  2.  72 

July  with  June 

149 
149 

August  with  July 

+      24 

242 
242 

August  with  July  .  . 
September    with 

+  1.67 
+  4.00 

September    with 

+     .33 

August. 

August. 

149 

October  with  Sep- 

+    .45 

242 

October  with  Sep- 

+ 1.08 

tember. 

tember. 

6 

143 

November    with 

+0.57 

+  1.15 

22 

220 

November    with 

+2.88 

-1.13 

October. 

October. 

16 

133 

December    with 

-  .19 

+     .51 

27 

215 

December    with 

+2.54 

-1.71 

November. 

November. 

1918. 

1918. 

16 

133 

January  with  De- 

+3.91 

+  3.71 

51 

191 

January  with  De- 

+ .74 

-4.83 

cember,  1917. 

cember,  1917. 

16 

133 

February     with 

+  .71 

-     .12 

55 

187 

February     with 

+  1.23 

+4.43 

January. 

January. 

16 

133 

March   with    Feb- 

+ 1.86 

+  3.12 

55 

187 

March   with   Feb- 

+ .33 

+  '.83 

ruary. 

ruary. 

31 
31 

118 
118 

April  with  March  . 
May  with  April..  . 

+4.26 
+  .96 

+  4.73 
+  1.73 

60 
62 

182 
ISO 

April  with  March.. 
May  with  April  

-  .45 
-1.21 

+  .45 
-2.41 

31 

118 

June  with  May.  .  .   . 

+  .09 

+  1.57 

72 

170 

June  with  May  

—1.99 

+  .47 

42 
42 
42 

107 
107 
107 

July  with  June.  .  .  . 
August  with  July  . 
September  with 

+  .32 
+  .93 
+  .09 

+  1.68 
+  1.11 
+  1.86 

72 
75 

75 

170 

167 
167 

July  with  June  
August  with  July  .  . 
September     with 

-7.62 
—2.33 
+1.19 

+  .09 
-  .50 
+  .63 

August. 

August. 

42 

107 

October  with  Sep- 

-1.47 

0.00 

75 

167 

October  with  Sep- 

-1.46 

+2.39 

tember. 

tember. 

42 

107 

November    with 

+  .53 

+     .35 

75 

167 

November    with 

-  .36 

+  .56 

October. 

October. 

42 

107 

December    with 

-  .35 

-  1.03 

75 

167 

December    with 

—9.44 

-  .95 

November. 

November. 

502 


HISTORY   OF   PRICES   DURING   THE   WAR. 


CHAIN  INDEX  OF  CONTROLLED  AND  UNCONTROLLED  PRICES— Continued. 
[Showing  weighted  rise  or  fall,  by  per  cents,  of  controlled  and  uncontrolled  prices  for  each  month  of  the  war.] 


Wheat  and  wheat  products. 

Cotton  and  cotton  products. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

12 
12 
12 
12 
12 

1917. 

April  with  March  .  . 
May  with  April.... 



+  17.01 
+20.91 
-  7.26 
7.07 



81 
81 
81 
81 

81 
81 

81 
JSl 
81 

81 
81 
81 

81 
77 
77 
24 
24 
24 

24 
24 
24 

1917. 

+  7.80 
+  2.98 
+  7.03 
+  10.96 
-     .42 
+     .47 

+  1.69 
+  6.58 
4-  1.91 

+  5.68 
+  3.29 
+  3.90 

+  7.41 
-  3.37 
-     .11 
+  4.35 
-  2.68 
+  15.66 

-  1.32 

-  7.88 
-  5.71 

May  with  April 

June  with  May 

July  with  June  . 

July  with  June 

August  with  July 

+       73 

12 
12 
12 
12 

12 
12 
12 

12 
12 
12 
12 
12 
12 

12 
12 
12 

September  with 
August. 
October  with  Sep- 
tember. 
November  with 
October. 
December  with 
November. 

1918. 

January  with  De- 
cember, 1917. 
February  with  Jan- 
uary. 
March  with    Feb- 
ruary. 
April  with  March  .  . 
May  with  April  .  .  . 

7.19 

September  with 
August. 
October  with  Sep- 
tember. 
November  with 
October. 
December  with 
November. 

1918. 

January  with  De- 
cember, 1917. 
February  with  Jan- 
uary. 
March   with    Feb- 
ruary. 
April  with  March 

2.10 

-     .82 
-  2.64 

-     .77 
+  1.41 
-  1.09 

+  3.28 
—  1.60 

? 



..„. 

4 

57 
57 
57 

57 
57 
57 

May  with  April.... 
June  with  May  
July  with  Tune  
August  with  July.  . 
September  with 
August. 
October  with  Sep- 
tember. 
November  with 
October. 
December  with  No- 
vember. 

0.00 
0.00 
+  1.33 
+  1.37 

4  85 

June  with  May  
July  with  June.  . 

+     .84 
+  3.76 

August  with  July.  . 
September  with 
August. 
October  with  Sep- 
tember. 
November  with 
October. 
December  with  No- 
vember. 

-  1.04 
-     .39 

-     .39 
-     M8 
+  1.53 



+     .46 
23 

-     .96 

Wool  and  woolen  products. 

Hides  and  skins  and  their  products. 

Con- 
trolled 
Series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

66 
66 
66 
66 
66 
66 

66 
66' 
66 

66 
66 
66 

66 
51 
51 
51 
45 
45 

45 
45 

45 

1917. 
April  with  March  .  . 

+3.62 
+3.72 

+  5  51 

156 
156 
156 
156 
156 
156 

156 
156 
156 

156 
156 
156 

156 
108 
106 
106 
96 
% 

96 
96 
96 

1917. 

April  with  March  . 

-0.66 
+  .40 
-  .26 
+3.73 
-  .76 
-2.02 

-  .06 

+  1.77 
+   .20 

+  1.93 
2.30 

May  with  April 



May  with  April 

June  with  May  .  . 

June  with  May. 

July  with  June 

+4.88 
-4-5.  44 



July  with  June 

August  with  July  .  . 

August  with  July 

September    with 
August. 
October  with  Sep- 
tember. 
November    with 
October. 
December    with 
November. 

1918. 

January  with  De- 
cember, 1917. 
February  with  Jan- 
uary. 
March  with  Febru- 
ary. 
April  with  March 

i  +1.65 

September    with 
August. 
October  with  Sep- 
tember. 
November    with 
October. 
December    with 
November. 

1918. 

January  with  De- 
cember, 1917. 
February  with  Jan- 
uary. 
March  with  Febru- 
ary. 
April  with  March 

i  4-2.26 



+3.89 
+2.39 

+  1.69 
+1.19 











+2.65 
+2.29 

-1.32 

+  .34 

+  1.22 
+  .62 
+2.50 
+  .06 
-  .16 

+  .15 
+  .79 
+   .-44 

15 
15 
15 
21 
21 

21 
21 

21 

May  with  April.... 
June  with  May  
July  with  June  
August  with  July  .  . 
September    with 
August. 
October  with  Sep- 
tember. 
November    with 
October. 
December    with 
November. 

-1.66 
-  .V 
+  1.70 
-  .21 
+  .83 

-  .21  ; 
-  .41 
-3.53 

+  1.84 
+  .86 
+2.50 
+  .93 
+  1.20 

+  1.55 
-1.47 
-1.38 

48 
50 
50 
60 
60 

60 
60 
60 

May  with  April  .  .  .  .  +  10.  60 
June  with  May  +     .68 
July  with  June  -  1.72 
August  with  July  .  .  -  1.  19 
September    with  +    .70 
August. 
October  with  Sep-   +     .80 
tember. 
November    with    —     .05 
October. 
December    with   —  1.03 
November. 

GOVERNMENT   CONTROL   OVER  PRICES. 


503 


CHAIN  INDEX  OF  CONTROLLED  AND  UNCONTROLLED  PRICES— Continued. 
[Showing  weighted  rise  or  fall,  by  per  cents,  of  controlled  and  uncontrolled  prices  for  each  month  of  the  war.] 


Iron  and  steel  and  their  products. 

Coal  and  coke. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

88 
88 
88 
88 
88 
79 

72 
65 
52 

52 
52 
52 

52 
52 
52 
52 
52 
52 

52 
52 
52 

1917. 
April  with  March. 

+  7.69 

27 
27 
27 
27 
27 
27 

27 
27 
27 

1917. 
April  with  March.. 

+42.78 
+  6.92 
+     .27 
-  5.07 
+     .48 

Mav  with  April 

+  7  35 

May  with  April 

June  with  May  
July  with  June. 



+  17.14 

+  7.45 

June  with  Mav 

July  with  June  

August  with  Juiv 

—  6.53 

August  with  July  . 

9 
16 
23 
36 

36 
36 
36 

36 
36 
36 
36 
36 
36 

36 
36 
36 

September      with 
August. 
October  with  Sep- 
tember. 
November  with  Oc- 
tober. 
December  with  No- 
vember. 

1918. 
January  with  De- 
cember, 1917. 
February    with 
January. 
March  with  Febru- 
ary. 
April  with  March. 
May  with  April.. 
June  with  May... 
July  with  June... 
August  with  July. 
September   with 
August. 
October  with  Sep- 
tember. 
November  with  Oc- 
tober. 
December  with  No- 
vember. 

-  9.73 
-26.03 
-10.42 
-     .44 

+   .10 

+     .41 
-     .03 

-     .52 
—     .01 
+     .11 
+     .11 
+     .49 
+     .02 

+  1.23 
+     .13 
2  53 

-10.69 
-3.84 
6  27 

September      with 
August. 
October  with  Sep- 
tember. 
November  with  Oc- 
tober. 
December  with  No- 
vember. 

1918. 

January  with  De- 
cember, 1917. 
February      with 
January. 
March  with  Febru- 

Aprilwith  March... 
May  with  April.... 
June  with  May  
July  with  June. 

-  6.06 
-     .17 
+  2.69 
+     .74 

+     .84 
+     .24 
+     .52 

+20.91 
+  1.14 
-  2.39 
—     .18 

+     .13 

+     .51 
+     .33 
-  1.55 

+  1.12 
+     .15 
+  2.52 
+  1.42 
+     .44 
-     .13 

+  2.61 
+     .68 
+  2.09 

27 

27 
27 

27 
27 

27 
27 
27 
27 

27 
27 
27 



August  with  July.  .  . 
September    with 
August. 
October  with  Sep- 
tember. 
November  with  Oc- 
tober. 
December  with  No- 
vember. 

+     .43 
+     .99 

+     .002 
+  3.48 
0.00 



Lumber. 

Fertilizers  class. 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices.- 

Con- 
trolled 
series. 

Un- 
con- 
trolled 
series. 

Comparison. 

Con- 
trolled 
prices. 

Un- 
con- 
trolled 
prices. 

62 
62 
62 
62 
62 
62 

62 
57 
53 

53 
53 
53 

38 
38 
38 
38 
38 
38 

38 
38 
38 

1917. 
April  with  January 

+22.98 
+  4  56 

25 
25 
25 
25 
25 
25 

25 
25 
25 

3 
3 
3 

3 
3 
0 
0 
0 
0 

0 
0 
0 

1917. 
April  with  March.  .  . 

+  1.94 
+  3.09 

+  6.48 
+  4.21 

+  7.83 
+     .98 

+  4.91 
-  2.64 
+  5.12 

-  1.53 
+14.53 
+  2.55 

0.00 
-25.12 

July  with  April 

Mav  with  April  

Juiie  with  May  

Julv  with  June  

October  with  July  .  . 

1918. 

January  with  De- 
cember, 1917. 

April  with  January. 
July  with  April.... 

October  with  July.. 

+5.26 

+5.63 
-  .60 

-2.58 

+  1.39 

+  3.67 

+  6.72 
+     .82 

+     .30 

August  with  July  .  .  . 

September      with 
August. 
October  with  Sep- 
tember. 
November  with  Oc- 
tober. 
December  with  No- 
vember. 

1918. 

January  with  De- 
cember, 1917. 
February  with  Jan- 

MaS  with  Febru- 

April'with  March.. 
May  with  April.... 
June  with  May  
July  with  June.  .  .  . 



5 
9 

9 

9 
9 

24 
24 
24 
24 
24 
24 

24 
24 

24 

22 
22 
22 

22 
22 
25 
25 
25 
25 

25 
25 
25 

+  .68 
+3.12 
-  .17 

+2.38 
+  1.22 
-1.52 
—4.06 

August  with  Julv  .  . 
September      with 
August. 
October  with  Sep- 
tember. 
November  with  Oc- 
tober. 
December  with  No- 
vember. 

+  1.02 
-3.41 

-1.51 
+  .12 
-1.63 

504  HISTORY  OF  PRICES  DURING  THE   WAR. 

4.  RELATIVE  POINTS  BELOW  WHICH  50  BASIC  COMMODI- 
TIES WERE  PEGGED. 

One  of  the  primary  motives  behind  price  control  during  the  war 
was  the  desire  to  stimulate  a  maximum  production.  The  various 
committees,  though  always  desirous  of  holding  prices  within  reason- 
able bounds,  were  anxious  primarily  to  assure  a  full  output  and  did 
so  frequently  by  means  of  liberal  price  allowances.  They  under- 
took to  meet  these  ends  by  a  rather  extensive  regulation  over  the 
prices  of  important  basic  raw  materials.  The  Government  early 
regulated  wheat,  and  then  as  occasion  demanded  it  extended  control 
to  various  other  raw  materials  such  as  copper,  iron  ore,  pig  iron, 
lumber,  wool,  hides  and  skins,  and  cotton  yarns.  A  study  of  the 
schedules  of  these  fixed  prices,  gives  a  very  poor  notion  of  the  relative 
market  heights  at  which  each  regulation  began,  both  with  respect  to 
its  own  prewar  level  and  with  respect  to  that  of  other  controlled 
prices.  It  is  of  significance  to  know  whether  Government  inter- 
ference with  prices  began  generally  at  the  same  relative  heights,  or 
whether  other  factors  dictated  the  time  and  character  of  the  Govern- 
ment control.  Another  equally  significant  inquiry  is  the  relation 
which  the  fixed  prices  bore  to  the  market  prices  prevailing  at  the 
time  regulation  set  in. 

There  have  here  been  chosen  from  the  whole  list  of  573  controlled 
commodities  50  of  the  most  representative  individual  price  series 
which  typify  the  common  practices  of  Government  regulation.  The 
actual  market  prices  at  wholesale  by  months  from  January,  1913, 
through  December,  1918,  for  each  of  these  controlled  basic  commodi- 
ties, have  been  turned  into  relative  prices  by  making  the  average  pre- 
war price  (July  1,  1913,  to  June  30,  1914)  equal  100.  Each  relative 
price  thus  is  strictly  comparable  with  any  other.  Relative  prices  of 
this  character,  for  those  who  seek  simply  the  relation  of  any  market 
price  when  Government  control  began,  to  its  corresponding  prewar 
price  are  more  accurate  than  the  index  numbers  or  chain  indexes  of 
groups  and  classes.  The  relative  prices  of  individual  raw  materials 
controlled,  for  the  point  in  mind,  have  the  decided  advantage  of 
standing  as  separate  series  precisely  at  the  height  they  had  attained 
when  taken  hold  of  by  the  Government.  They,  moreover,  are  free 
from  weights  and  permit  of  a  study  of  price  rises  pure  and  simple. 
These  devices  make  readily  possible  a  comparison  of  the  relative 
points,  above  their  prewar  prices,  below  which  any  or  all  of  the  50 
selected  commodities  were  pegged. 

The  market  price  for  calfskins,  No.  1,  country,  8  to  15  pounds,  at 
Chicago,  for  example,  was  $0.1984  per  pound  (made  equal  to  100) 
before  the  war  in  Europe.  It  had  reached  $0.4040  per  pound  (found 
equal  to  204  when  compared  with  the  prewar  price)  in  May,  1918, 


GOVERNMENT  CONTROL  OVER  PRICES.  505 

when  the  Government  determined  upon  control  of  calfskin  prices. 
The  Government  set  the  price  at  $0.34  per  pound  (similarly  found 
equal  to  171).  It  is  clear  that  while  the  market  had  sent  calfskin 
prices  from  100  in  1913-14  to  204  by  May,  1918,  the  Government 
then  fixed  them  at  a  maximum  of  171.  They  were  in  point  of  fact, 
quoted  subsequently  at  figures  above  this  maximum.  Data  are  given 
by  which  one  may  make  for  himself  a  similar  analysis  for  each  of  the 
50  commodities  carried.  A  summary  of  the  relative  price  of  each 
commodity  before  the  European  war,  the  relative  market  price  which 
prevailed  when  the  Government  determined  upon  regulation,  and  the 
relative  price  at  which  the  Government  fixed  its  initial  price  precedes 
the  fuller  tables  of  individual  commodities. 

The  50  individual  commodities,  which  were  selected  from  the  lot 
of  573  controlled  in  price  and  the  actual  prices  of  which  may  be  had 
from  the  Price  Section's  class  bulletins,  follow  with  their  full  com- 
mercial descriptions: 

I.  FOOD  GROUP. 

1.  Bacon,  rough  sides,  smoked  loose,  Chicago. 

2.  Beef,  good  native  steers,  fresh  carcass,  Chicago. 

3.  Cattle,  steers,  choice  to  prime,  heavy  beeves,  Chicago. 

4.  Corn,  cash,  No.  3  yellow,  Chicago. 

5.  Cottonseed  oil,  crude,  in  barrels,  f.  o.  b.  mill. 

6.  Hogs,  live  (bulk  of  sales),  Chicago. 

7.  Oats,  No.  3,  white,  cash,  Chicago. 

8.  Rice,  Honduras  head,  domestic,  clean,  New  Orleans. 

9.  Sugar,  96°  centrifugal,  New  York. 

10.  Wheat,  No.  1  northern  spring,  Minneapolis. 

II.  CLOTHING  GROUP. 

11.  Calfskins,  No.  1  country  hides,  8  to  15  pounds,  Chicago. 

12.  Cattle  hides,  packer,  heavy  native  steers,  Chicago. 

13.  Cotton  duck,  standard  United  States  Army,  firsts,  28^-inch  8-ounce,  commercial. 

14.  Cotton  linters,  grade  D,  cut  130-175,  New  York. 

15.  Cotton  yarn,  weaving,  carded,  white,  northern  mulespun,  22/1  cones,  Boston. 

16.  Leather,  harness,  grade  B,  California  oak,  Chicago. 

17.  Leather,  belting,  butts,  medium  standard  tannages,  Philadelphia. 

18.  Print  cloths,  27-inch,  64  by  60,  7.60  yards,  Boston. 

19.  Rags,  woolen,  new  clips,  blue  worsted,  New  York. 

20.  Sheeting,  Ware  Shoals,  L.  L.,  brown,  New  York. 

21.  Wool,  domestic,  Ohio,  Pennsylvania,  West  Virginia,  unwashed,  fine  delaine, 

Boston. 

22.  Wool,  Buenos  Aires,  46s,  shrinkage  34  per  cent,  Boston. 

III.  RUBBER,  PAPER,  AND  FIBER  GROUP. 

23.  Manila  fiber,  fair  current  shipment,  New  York. 

24.  Paper,  newsprint,  rolls,  car  lots,  United  States  average. 

25.  Rubber,  crude,  Hevea,  first  latex  crepe,  New  York. 


506  HISTORY   OF   PRICES  DURING  THE   WAR. 

IV.  METALS  GROUP. 

26.  Copper,  electrolytic,  New  York. 

27.  Iron  ore,  Mesabi  Non-Bessemer,  51£  per  cent,  lower  lake  ports. 

28.  Lead,  pig,  New  York. 

29.  Pig  iron,  basic,  Mahoning  or  Shenango  Valley  furnace. 

30.  Quicksilver,  New  York. 

31.  Steel  bars,  base,  Pittsburgh. 

32.  Steel  billets,  open  hearth,  Pittsburgh. 

33.  Steel  plates,  tank,  Pittsburgh. 

34.  Steel  structural  shapes,  Chicago. 

35.  Tin  plates,  domestic  coke,  14  by  20  inches,  Pittsburgh. 

36.  Zinc  sheets,  f.  o.  b.  La  Salle  or  Peru,  111. 

V.  FUELS  GROUP. 

37.  Coal,  anthracite,  chestnut,  New  York. 

38.  Coal,  bituminous,  Pittsburgh,  No.  8  Ohio,  Columbus  and  Detroit. 

39.  Coke,  Connellsville  furnace,  f.  o.  b.  ovens. 

40.  Petroleum,  crude,  Mid -continent  (Kansas- Oklahoma),  at  wells. 

VI.  BUILDING  MATERIALS  GROUP. 

41.  Cement,  Portland  domestic,  New  York. 

42.  Douglas  fir,  common,  No.  1,  1  by  8  by  10,  Washington  mills. 

43.  Pennsylvania  hemlock,  No.  1  boards,  1  by  10  to  16,  f.  o.  b.  mill. 

44.  Southern  or  yellow  pine,  common  boards,  No.  1  S2S,  1  by  10,  Arkansas. 

45.  Spruce,  random,  2  by  10,  Boston. 

VII.  CHEMICALS  GROUP. 

46.  Alcohol,  wood,  refined,  95  per  cent,  New  York. 

47.  Arsenic,  white,  New  York. 

48.  Caustic  soda,  76  per  cent,  spot,  New  York. 

49.  Nitrate  of  soda,  95  per  cent,  New  York. 

50.  Sulphuric  acid,  60°  Be.,  New  York. 


GOVERNMENT   CONTROL  OVER  PRICES. 


507 


a _§ 


i      i 


I  i      i      i     i ^§ 


I5B 


rl 


tZa 

2 


•'*&& 


508 


HISTORY  OF  PRICES  DURING  THE  WAR. 


g •!_ 


I 1 


8          8. 


GOVERNMENT   CONTROL   OVER  PRICES. 


509 


510 


HISTORY   OF   PRICES  DURING  THE  WAR. 


r»«j^    I  «-  *  r!_I 


Relative  prices.— Pig  iron,  basic.— By  months,  Janu- 
ary. 1913,  to  December,  1918.  (Average  quoted 
prices,  July,  1913,  to  June,  1914=100.) 


Relative  prices.— Steel  plates,  tank.— By  months. 
January,1913,toDecember,1918.  (Average  quoted 
prices,  July,  1913,  to  June,  1914=100.) 


GOVERNMENT   CONTROL   OVER  PRICES. 


511 


RELATIVE  PRICES  OF 

ANTMRACITC  COAL 

CHESTNUT 

BY  MONTHS 
•JANUARY,19J3TODeCEMeED  151S 
AVERAC.E  QUOTED  PRlCEXJUL^lOlS'injNE^'  100 

1016 

1  i  5 

1  9  fi 

nxtortn 

i 

220 
200 
80 
60 
,40 
120 

too 

180 
160 

r 

I 

1ZO 

100 

I 

V 

\J 

\        /— 

-v  /- 

3L/C 

J 

r 

60 
60 

V 

V 

b? 

1 

60 
60 

,,l,  ,1.,!.. 

iifnii.  i.. 

$  3  R 
i     1915 

f-SH 

D  I* 

UM 

Mr 

Relative  prices.— Anthracite  coal,  chestnut.— By 
months,  January,  1913,  to  December,  1918.  (Aver- 
age quoted  prices,  July,  1913,  to  June,  1914=100.) 


Relative  prices.— Coal,  bituminous.— By  months, 
January,  1913, toDecember,  1918.  (Average  quoted 
prices,  July,  1913,  to  June,  1914- 100.) 


512 


HISTORY   OF   PRICES   DURING   THE   WAR. 


RELATIVE  PRICES  Of 

CRUDE  PETROLEUM 


KT  MONTHS 
JANUARY,  19 
AVERAGE  QJOTrDPR'.CEiJXNr:iSS'T°JUNe.l9W-100 


Relative  prices.— Coke,  Connellsville.— By  months, 
January,  1913,  to  Dec  ember,  1918.  (Average  quoted 
prices,  July,  1913,  to  June,  1914=100.) 


Relative  prices.— Crude  petroleum,  mid-continent.— 
By  months,  January,  1913,  to  December,  1918. 
(Average  quoted  prices,  July,  1913,  to  June,  1914= 
100.) 


GOVERNMENT   CONTROL   OVER  PRICES. 


513 


1 

§-      i 

5      ' 

3         S 

3            § 

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i 

I 

3          3 

c 

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- 

r 

J      " 

^ 

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a        i! 

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. 

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IX 

^|3  *|i  i 

•  ^ 

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B        a 

ff,i 


SS||f9 

fil 
•^i  i 


8          8 


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lfij 

CO-3S 


125547°— 20 33 


514 


HISTORY   OF   PRICES   DURING  THE  WAR, 


A  SUMMARY  OF  ACTUAL  AND  RELATIVE  PRICES  BELOW  WHICH  BASIC  COMMODITIES 

WERE  FIXED. 


Commodity. 


Prewar  price  (July, 
1913  to  June,  1914). 


Actual.      Relative. 


Market  price  when 
control  began. 


Actual.      Relative. 


Government  initial 
fixed  price. 


Actual.      Relative 


FOODS. 


1.  Bacon $0.1298 

2.  Beef 1297 

3.  Cattle 9. 1022 

4.  Corn 6859 

5.  Cottonseed  oil .  0607 

6.  Hogs.live 8.3094 

7.  Oats .4005 

8.  Rice .0526 

9.  Sugar,  raw .  0340 

10.  Wheat 8901 

CLOTHING. 

11.  Calfskins 1984 

12.  Cattle  hides .  1861 

13.  Cotton  duck .  1550 

14.  Cotton  linters .0205 

15.  Cotton  weaving  yarn .  2438 

16.  Leather,  harness .  4121 

17.  Leather,  belting .  5042 

18.  Printcloths .0335 

19.  Rags,  woolen .  1250 

20.  Sheeting .0606 

21.  Wool,  domestic .2317 

22.  Wool,  Buenos  Aires .  3083 

RUBBER,  PAPER,   AND  FIBEE. 

23.  Manila  fiber .0780 

24.  Paper,  newsprint 1. 9046 

25.  Rubber,  crude .6123 

METALS. 

26.  Copper,  electrolytic .x. .  1492 

27.  Iron,  ore 

28.  Lead,pig 0418 

29.  Pigiron, basic 13.3183 

30.  Quicksilver 38.8558 

31.  Steel  bars 1.2600 

32.  Steel  billets 21.7917 

33.  Steel  plates 1.2600 

34.  Steel  structural  shapes 1.4600 

35.  Tinplate 3. 4375 

36.  Zinc  sheets .0735 

FUELS. 

37.  Coal,  anthracite 3. 7800 

Coal,  bituminous 1.0900 

39.  Coke,  Connellsville 2. 0625 

40.  Petroleum,  crude .9725 


BUILDING  MATERIALS. 


41.  Cement.  Portland 

42.  Douglas  fir 

43.  Pennsylvania  hemlock 

44.  Southern  or  yellow  pine 

45.  New  England  spruce 


CHEMICALS. 


46.  Alcohol,  wood. 

47.  Arsenic 

48.  Caustic  soda. .. 

49.  Nitrate  of  soda. 

50.  Sulphuric  acid. 


1.5800 

7. 9167 

24.8300 

13.8750 

24.2600 


.4558 
.0310 
.0181 
2.  3183 
.0085 


100 

100 
100 
100 
100 
100 
100 
100 
100 
ICO 


100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 


100 
100 

100 


100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 


100 
100 
100 

100 


100 
100 
100 
100 
100 


103 
100 
100 
100 
100 


80. 1750 
16. 9500 


.0938 

.0690 

2. 7875 


.4040 
.3110 
.3425 
.0487 
.7120 
.6800 
.9700 
.1300 
.5650 
.2300 
.7500 
.7400 


.2731 

3. 2450 

.6000 


.2545 

5.0500 

.0625 

42. 7500 

121.7600 

3.8800 

55. 2500 

7.0500 

5.1900 

12.0000 

.1800 


4.9000 
2. 5400 
11. 7500 
2. 2500 


2. 5600 
18. 5000 
32.6200 
27. 5000 
46. 3700 


1.3500 
.1600 
.  0490 

4. 4938 
.0125 


204 


$0. 1750 
15. 5000 


178 
203 
313 


204 
167 
221 
238 
292 
165 
192 
388 
452 
380 
324 
240 


350 
170 
98 


171 
153 
150 
321 
313 
308 
234 
560 
355 
349 
245 


130 
233 
570 
231 


102 
234 
131 
198 
191 


296 
516 
271 
194 
147 


.0913 
.06005 
2. 1700 


.  3-tCO 
.3300 
.3350 
.0467 
.6650 
.6800 
.9600 
.1125 
.6200 
.1750 
.7500 
.7400 


.2600 
3.1000 
\   3.5000 
.6300 


.2350 

5. 0500 

.0805 

33.0000 

105.0000 

2.9000 

47. 5000 

3.2500 

3.0000 

7.7500 

.1500 


4.8000 
2.0000 
6.0000 


1.8500 
18.5000 
32.0000 
24.0000 
45. 0000 


.7900 
.0900 
.0350 
4.2250 
.0090 


516 


HISTORY   OF   PRICES  DURING   THE   WAR. 


RELATIVE   PRICES    OF  FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Food  group. 

Bacon, 
rough 
sides, 
smoked, 
loose, 
Chicago 
(per 
lb.). 

Beef, 
good, 
native 
steers, 
fresh 
carcass, 
Chicago 

K 

Cattle, 
steers, 
choice 
to 
prime 
heavy 
beeves, 
Chicago 
(per 
cwt.)- 

$9.  1022 
100 

Corn, 
cash, 
No.  3, 
yellow, 
Chicago 
(per 
bu.). 

Cotton- 
seed 
oil, 
crude, 
in 
barrels, 
f.  o.  b. 
mill 
(per 
lb.). 

Hogs, 
live, 
(bulk  of 
sales), 
Chicago 
(per 
cwt.). 

Oats, 
No.  3, 
white, 
cash, 
Chicago 
(per 
bu.). 

Rice. 
Hon- 
duras 
head, 
domes- 
tic, 
clean. 
New 
Orleans 
(per 
lb.). 

!  Wheat, 
Sugar,  I  No.  1 
raw,       North- 
96°  cen-      era 
trifugal,  spring, 
New      Minne- 
York    i  apolis 
(perlb.).:    (per 
i   bu.). 

Prewar  base  price.. 
Made  equal  to.. 
Market  price  when 
control  began 

SO.  1298 
100 

$0.  1297 
100 

$0.  6859 
100 

$0.  0607 
100 

.1750 
288 
.1750 
288 

83 
86 
87 
95 
97 
101 

119 
110 
101 
95 
99 
92 

85 
97 
107 
96 

95 

96 
98 
101 
104 
102 
103 

102 
89 
79 
67 
75 
80 

98 
103 
90 

74 

92 

91 

f8 
91 
91 
89 
86 

85 
86 
88 
109 
113 
120 

93 
89 
87 
114 

98 

$8.  3094 
100 

16.  9500 
204 
15.  5000 
187 

90 
98 
110 
106 
102 
103 

109 
101 
101 
99 
94 
93 

99 
104 
104 
95 

101 

98 
103 
103 
102 
99 
97 

108 
107 
103 
94 
92 
87 

102 
100 
106 
91 

100 

82 
80 
81 
87 
89 
89 

85 
83 
88 
93 
80 
76 

81 

88 
86 
83 

85 

$0.  4005 
100 

$0.  0526 
100 

.0938 
178 
.0913 
174 

90 
90 
91 
93 
92 
96 

102 
105 
97 
103 
100 
95 

91 
94 
102 
99 

96 

95 
99 
100 
100 
101 
102 

102 
105 
95 
90 
83 
94 

98 
101 
101 

88 

97 

93 
94 
94 
94 
94 
94 

92 
86 
80 
83 
90 
87 

94 
94 
86 

87 

90 

$0.  0340 
100 

.0690 
203 
.  06005 
176 

104 
103 
104 
100 
98 
98 

104 
110 
109 
103 
106 
99 

104 
99 
108 
103 

103 

98 
101 
88 
88 
96 
98 

96 
168 
171 
131 
115 
116 

96 
94 
145 
121 

114 

119 
138 
142 
141 
142 
144 

143 

140 
126 
121 
140 
145 

133 
143 
136 
135 

137 

$0.8901 
100 

2.  7875 
313 
2.  1700 
244 

97 
98 
95 
99 
102 
103 
101 
99 
97 
94 
95 
% 

97 
101 
99 
95 

98 

98 
104 
104 
102 
105 
103 

101 
120 
128 
124 
130 
134 

102 
103 
116 
129 

113 

152 
170 
165 
173 
177 
144 

156 
154 
110 
114 
114 
127 

162 
165 
140 
118 

147 

Found  equal  to  . 
Government  price  .  . 
Found  equal  to. 

1913—  Months- 
January  — 
February  .  . 
March..:... 
April... 



83 
84 
82 
87 
95 
102 

98 
105 
106 
99 
99 
101 

83 
94 
104 
100 

95 

97 
98 
98 
98 
100 
100 

93 
105 
123 
117 
121 
122 

98 
99 
107 
120 

106 

134 
144 
144 
143 
133 
122 

134 
112 
87 
91 
92 
105 

140 
133 
113 
96 

120 

83 
86 
88 
92 
96 
99 

105 
101 
98 
97 
97 
97 

85 
96 
101 
97 

95 

98 
99 
97 
95 
93 
98 

105 
111 
110 
103 
97 
92 

98 
96 
109 
97 

100 

91 
91 

86 
86 
88 
90 

86 
80 
75 
85 
92 
94 

89 
88 
80 
90 

87 

Ill 

99 
99 
99 
99 
99 

97 
96 
99 
100 
100 
100 

103 
99 
98 
100 

100 

100 
100 
100 
101 
102 
102 

104 
109 
111 
111 
111 
110 

100 
102 
108 
111 

105 

100 
94 
91 
91 
94 
97 

101 
102 
104 
106 
106 
106 

95 
94 
103 
106 

99 

99 
88 
98 
98 
95 
96 

99 
98 
100 
100 
98 
98 

98 
96 
99 
99 

98 

101 
101 
102 
102 
100 
101 

106 
110 
116 
115 
112 
107 

101 
101 

m 
111 

106 

101 
94 
95 
92 
95 
102 

109 
108 
107 
106 
109 
106 

97 
96 
108 
107 

102 

70 
71 
74 

81 
83 
89 

90 
108 
110 
102 
106 
100 

82 
84 
104 
102 

90 

91 
90 
95 
99 
102 
104 

104 
118 
115 
107 
100 
94 

92 
102 
114 
101 

102 

104 
108 
105 
110 
111 
109 

114 
119 
112 
93 
93 
97 

106 
110 
114 
94 

107 

May 

June.  .  . 

July.... 

August  
September  . 
•   October.... 
November. 
December.. 

Quarters- 
First  
Second  
Third  
Fourth  

Year. 

1914—  Months- 
January  
February  .  . 
March  
April  
May  
June 

July  
August  
September  . 
October.... 
November. 
December.. 

Quarters- 
First  
Second  
Third  
Fourth  

Year  

1915—  Months- 
January  
February  .  . 
March  
April 

May.... 

June.  .  . 

July.... 

August  
September  . 
October  
November. 
December.. 

Quarters- 
First. 

Second  
Third  
Fourth  

Year  

GOVERNMENT   CONTROL  OVER  PRICES. 


517 


RELATIVE   PRICES   OF  FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Food  group. 

Bacon, 
rough 
sides, 
smoked, 
loose, 
Chicago 

i(K 

Beef, 
good, 
native 
steers, 
fresh 
carcass, 
Chicago 
(per 
lb.). 

Cattle, 
steers, 
choice 
to 
prime 
heavy 
beeves, 
Chicago 
(per 
cwt.). 

Corn, 
cash, 
No.  3, 
yellow, 
Chicago 
(per 
bu.). 

Cotton- 
seed 

crud'e, 
in 
barrels 
f.  o.  b. 
mill 
(per 

tf.). 

Hogs, 
live, 
(bulk  of 
sales), 
Chicago 
(per 
cwt.). 

Oats, 
No.  3, 
white, 
cash, 
Chicago 
(per- 
bu.). 

Rice, 
Hon- 
duras 
head, 
domes- 
tic, 
clean 
New 
Orleans 
(per 
lb.). 

Sugar, 
raw, 
96°  cen- 
trifugal, 
New 
York 
(perlb.). 

Wheat, 
No.  1 
North- 
ern 
spring, 
Minne- 
apolis 
(per 
bu.). 

Prewar  base  price.  . 
Made  equal  to.. 
Market  price  when 
control  began 

$0.  1298 
100 

$0.  1297 
100 

$9.  1022 
100 

$0.  6859 
100 

$0.  0607 
100 

.1750 
288 
.1750 
288 

130 
136 
154 
168 
172 
154 

148 
150 
151 
175 
188 
185 

140 
165 
149 
182 

161 

% 

181 
178 
197 
226 
242 
240 

213 
221 
238 
266 
282 
281 

187 
236 

225 
277 

231 

5288 
288 
288 
288 
288 
288 

288 
288 
2288 
288 
288 
288 

288 
288 
288 
288 

288 

$8.  3094 
100 

16.9500 
204 
15.  5000 
187 

87 
99 
114 
116 
120 
115 

117 
123 
128 
121 
115 
113 

100 
117 
123 
117 

114 

130 
150 
172 
189 
192 
182 

184 
208 
219 
206 
1204 
205 

151 
188 
203 
205 

187 

192 
199 
203 
203 
202 
198 

212 
226 
233 
2202 
2200 
2205 

198 
201 
224 
202 

206 

$0.  4005 
100 

$0.0526 
100 

.0938 
178 
.0913 
174 

86 
88 
87 
87 
87 
87 

86 
85 
-      82 
85 
91 
90 

87 
87 
84 
89 

87 

90 
90 
93 
128 
133 
135 

133 
135 
136 
147 
U47 
151 

91 
133 
135 
148 

127 

151 
151 
162 
171 
172 
174 

2178 

176 
174 

174 
174 
174 

155 
172 
176 

174 

169 

$0.  0340 
100 

.0690 
203 
.06005 
176 

137 
144 
166 
181 
189 
186 

185 
164 
163 
184 
183 
156 

149 
185 
171 
174 
170 

154 
152 
161 
183 
179 
178 

195 

214 
205 
1203 
203 
186 

156 
180 
205 
198 

185 

2177 
177 
177 
177 
177 
177 

178 
2178 
205 
214 
214 
214 

177 
177 
186 
214 

189 

$0.  8901 
100 

2.  7875 
313 
2.1700 
244 

145 
144 
128 
137 
136 
125 

131 
167 
181 
197 
217 
198 

139 
133 
160 
204 

158 

125 
203 
223 
268 
335 
303 
290 
1313 
250 
244 
244 
244 

214 
302 
285 
244 

261 

3244 
244 
244 
244 
244 
244 

244 

250 
249 
249 
249 
249 

244 

244 
247 
249 

246 

Found  equal  to. 

Found  equal  to. 

1916—  Months- 
Jan  uary  — 
February  .  . 
March 

94 
98 
104 
105 
110 

Ul 

118 
120 
123 
123 

125 
121 

99 
108 
120 
123 

113 

123 
131 
147 
164 
179 
176 

183 
193 
207 
236 
1234 
232 

133 
173 
193 
234 

184 

204 
206 
203 
199 
191 
180 

200 
200 
206 
203 
203 
216 

204 
191 
202 
207 

201 

106 
106 
106 
106 
106 
109 

109 
106 
106 
106 
106 
106 

106 
107 
107 
106 

107 

106 
109 
115 
123 
123 
125 

126 
132 
146 
146 
1146 
144 

110 
124 
136 
146 

129 

135 
135 
135 
158 
173 
183 

185 
187 
189 
189 
189 
189 

135 
172 
187 
189 

171 

104 
102 
106 
107 
111 
121 

118 
116 
119 
120 
126 
127 

104 
113 
118 
125 

114 

126 
130 
137 
143 
146 
147 

149 
160 
179 
181 
1171 
156 

131 
145 
163 
170 

152 

151 
151 
153 
177 
192 
196 

199 
204 
211 
211 
214 
218 

152 
187 
205 
214 

190 

111 
108 
105 
111 
109 
106 

117 
125 
126 
141 
143 
133 

107 
109 
123 
139 

123 

144 
146 
164 
218 
240 
252 

301 
301 
301 
292 
1266 
244 

152 
235 
301 
265 

239 

240 
243 
228 
228 
216 
221 

234 
242 
226 
193 
189 
212 

236 
221 
234 
197 

222 

121 
116 
104 
110 
109 
98 

101 
112 
115 
123 
139 
130 

114 
105 
109 
131 

115 

142 
141 
154 
175 
175 
169 

197 
161 
149 
150 
U63 
190. 

146 
173 
167 
170 

164 

207 
221 
230 
222 
192 
191 

194 
174 
180 
173 
180 
179 

220 
201 
182 
178 

195 

April 

May  

June 

Julv 

August  
September  . 
October.... 
November. 
December.. 

Quarters- 
First  
Second  
Third  
Fourth  

Year  

1917—  Months- 
January  — 
February  .  . 
March  ... 

April 

May  
June 

July     -  . 

August  
September  . 
October  
November  . 
December.. 

Quarters- 
First 

Second  
Third 

Fourth  
Year 

1918—  Months— 
January  — 
February  .  . 
March  

\pril 

May... 

June  .  . 

July  

August  
September  . 
October  
November. 
December.. 

Quarters- 
First  

Second  
Third  
Fourth  

Year 

Government  control  began  during  month. 


Government  revised  price  during  month. 


518 


HISTORY  OF   PRICES   DURING   THE   WAR. 


RELATIVE  PRICES  OF  FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Clothing  group. 

Calfskins, 
No.  1 
country, 
8-15  Ibs., 
Chicago 
(per  lb.). 

1 

Cattle 
hides, 
packer, 
heavy, 
native 
steers, 
Chicago 
(per  lb.). 

Cotton 
duck, 
standard, 
U.S.  Army 
firsts,  28J 
in.,  8oz., 
Commercial 
(per  yd.). 

Cotton 
linters, 
Grade  D, 
cut  130-175, 
New  York 
(perlb.). 

Cotton 
yarn, 
weaving, 
carded, 
white, 
northern 
inulespun 
22/1  cones, 
Boston 
(perlb.). 

Leather 
harness, 
Grade  B, 
Calif,  oak, 
Chicago 
(perlb.). 

$0.  1984 
100 

.4040 
204 
.3400 
171 

91 
89 
87 
89 
94 
93 

96 
96 
97 
102 
102 
105 

89 
92 
96 
103 
95 

98 
98 
103 
101 
101 
101 

101 
103 
116 
113 
112 
121 

100 
101 
107 
116 

106 

113 

118 
108 
89 
96 
100 

102 
116 
103 
113 
117 
126 

113 
95 
107 
119 

109 

$0.  1861 
100 

.3110 
167 
.3300 
177 

103 
97 
97 
93 
89 
94 

95 
100 
101 
106 
106 
105 

99 
92 
99 
106 

..   99 

97 
98 
97 
97 
98 
99 

104 
110 
113 
114 
117 
121 

97 
98 
109 
117 

105 

124 
126 
124 
101 
111 
125 

138 
147 
142 
142 
141 
138 

125 
112 
143 
141 

130 

$0.  1550 
100 

.3425 
221 
.3350 
216 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
90 
90 
90 

SI 

81 

100 
100 
94 

84 

94 

81 
81 
81 

77 
77 
77 

77 
84 
84 
90 
90 
90 

81 
77 
82 
90 

83 

$0.  0205 
100 

.0487 
238 
.0467 
228 

122 
110 
122 
110 
110 
117 

117 
117 
110 
112 
112 
110 

118 
112 
115 
111 

114 

98 
85 
85 
85 
85 
85 

15 

85 
55 
55 
49 
55 

89 
85 
75 
53 

70 

G8 
102 
103 
127 
127 
195 

202 
198 
205 
327 
351 
375 

91 
150 
201 
351 

199 

SO.  2438 
100 

.7120 
292 
.  6650 
273 

98 
100 
98 
100 
100 
98 

98 
98 
103 
109 
107 
107 

99 
100 
100 
107 

102 

98 
98 
98 
98 
94 
90 

94 
90 
82 
82 
72 
74 

98 
94 
89 

76 

89 

78 
78 
70 
78 
76 
76 

76 
79 
82 
90 
94 
98 

75 

77 
79 
94 

81 

SO.  4121 
100 

.6800 
165 
.6800 
165 

99 
99 
99 
99 
99 
99 

99 
99 
98 
98 
101 
101 

M 

99 
99 
100 

99 

18! 

101 
101 
101 
101 

101 
101 
102 
103 
104 
104 

101 
101 
101 
104 

102 

109 
112 
110 
110 
107 
107 

107 
108 
112 
112 
112 
112 

110 
108 
109 
112 

110 

Made  equal  to 

Market  price  when  control  be- 
gan                                   .  .  . 

Government  price   .        

1913—  Months- 
January        

February 

March              

April 

May 

June  

July 

August  

September 

October            

November  .  . 

December 

Quarters- 
First 

Second  

Third 

Fourth 

Year....  

1914—  Months- 
January.. 

February 

March  . 

April... 

May.. 

June  

July 

August..    .           ..  .. 

September 

October 

November 

December 

Quarters- 
First 

Second  

Third 

Fourth.. 

Year  

1915—  Months- 
January  

February 

March  

April 

May... 

June 

July... 

August  

September 

October  

November.  . 

December  

Quarters- 
First  

Second 

x     Third  

Fourth 

Year. 

GOVERNMENT   CONTROL  OVER  PRICES. 


519 


RELATIVE   PRICES  OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


1 

Clothing  group. 

Leather 
belting, 
butts, 
medium 
standard 
tannages, 
Philadel- 
phia 
(perlb.). 

Printcloths, 
27  in., 
G4by60, 
7.60  yds., 
Boston 
(per  yd.). 

Rags, 
woolen, 
new  clips, 
blue 
worsted, 
New  York 
(perlb.). 

Sheeting, 
Ware 
Shoals,L.L., 
brown, 
New  York 
(per  yd.). 

Wool, 
dom.,  Ohio, 
Penn., 
W.  Va., 
unwashed, 
fine 
delaine, 
Boston 
(per  lb.). 

Wool, 
Buenos 
Aires  46s, 
shrinkage 
34  per  cent, 
Boston 
(per  lb.). 

Prewar  base  price 

30.  5042 
100 

.9700 
192 
.9600 
190 

103 
103 
103 
103 
101 
101 

99 
99 
99 
99 
101 
101 

103 
102 
99 
100 

101 

101 
99 
101 
101 
99 
99 

101 
101 
105 
109 
109 
109 

100 
100 
102 
109 

103 

111 
105 
111 
111 
111 
111 

121 
125 
135 
139 
139 
149 

109 
111 
127 

142 

122 

$0.  0335 
100 

.1300 
388 
.1125 
336 

112 

108 
108 
102 
97 
99 

98 
97 
104 
108 
105 
99 

110 
99 
99 
104 

103 

99 
99 
97 
98 
97 
99 

98 
95 
86 
76 
76 
73 

98 
98 
93 
75 
91 

76 
79 
79 
84 
90 
87 
84 
80 
85 
97 
93 
95 

78 
87 
83 
95 

86 

$0.  1250 
100 

.5650 
452 
.6200 
496 

92 
92 
124 
108 
108 
98 

84 
88 
88 
100 
104 
104 

103 
105 
87 
103 

99 

98 
104 
108 
113 
104 
104 

96 
92 
120 
124 
120 
120 

103 
107 
103 
121 

109 

136 
156 
192 
172 
172 
172 

168 
172 
196 
176 
204 
216 

161 
172 
179 
199 

178 

$0.  0606 
100 

.2300 
380 
.1750 
289 

105 
103 
103 
101 
99 
99 

97 
97 
101 
103 
103 
103 

104 
100 
98 
103 
101 

103 
101 
99 
97 
97 
97 

97 
95 
91 

83 
74 
74 

101 
97 

94 

77 
92 

72 

74 
76 
81 

78 
78 

87 
91 
99 
95 
95 
95 

74 
79 
92 
95 

85 

$0.  2317 
100 

.7500 
324 
.7500 
324 

122 
119 
110 
110 
97 
97 

97 
97 
97 
97 
97 
96 

117 
101 
97 
97 

103 

96 
100 
100 
•  101 
106 
114 

119 
119 
114 
106 
110 
110 

99 
107 
117 
109 
108 

114 
132 
140 
127 
127 
123 

127 
132 
132 
132 
132 
136 

129 

126 
130 
133 

129 

$0.  3083 
100 

.7400 
240 
.7400 
240 

123 
122 
120 
118 
117 
120 

122 
123 
120 
117 
110 
97 

122 
118 
122 

108 

117 

84 
78 
81 
88 
89 
91 

94 
95 
96 
97 
99 
101 

81 
89 
95 
99 

91 

110 
114 
117 
120 
122 
123 

127 
128 
130 
131 
133 
136 

114 
122 
128 
134 

124 

Made  equal  to       

Market  price  when  control 
began                

Found  equal  to             .  . 

Government  price  

Found  equal  to      

1913—  Months- 
January          

February 

March       

\pril                          -  - 

May 

June            

July 

August         

September 

October  

November 

Quarters- 
First  

Second  

Third 

Fourth    

Year  

1914—  Months- 
January 

February  

March 

May 

June 

July                         .  , 

August 

September      .         

October 

November  

December 

Quarters  — 
First 

Second  

Third               

Fourth 

Year            

1915—  Months- 
January  

February 

March... 

April 

May 

June  

July 

August  

September 

October  

November     

December 

Quarters- 
First 

Second 

Third  

Fourth 

Year  

520 


HISTORY   OF   PRICES  DURING   THE   WAR, 


RELATIVE   PRICES  OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Clothing  group. 

Calfskins, 
No.  1 
country, 
8-15  Ibs., 
Chicago, 
(perlb.). 

Cattle 
hides, 
packer, 
heavy, 
native 
steers, 
Chicago 
(perlb.). 

Cotton 
duck, 
standard, 
U.  S.  Army 
firsts,  28£ 
in.,  8oz., 
Commercia 
(per  yd.). 

Cotton 
1  inters, 
Grade  D, 
cut  130-175 
New  York 
(perlb.). 

Cotton 
yarn, 
weaving, 
carded, 
white, 
northern 
mulespun 
22/1  cones, 
Boston 
(perlb.). 

Leather 
harness, 
Grade  B, 
Calif,  oak, 
Chicago 
(perlb.). 

Prewar  base  price        

$0.  1984 
100 

.4040 
204 
.3400 
171 

129 
125 
139 
141 
164 
164 

171 
164 
•    166 
181 
227 
271 

131 
156 
167 
226 

170 

239 
208 
202 
214 
232 
214 

227 
202 
174 
176 
202 
166 

216 
220 
201 
181 

205 

161 
163 
156 
181 
1204 
197 

197 
197 
197 
197 
197 
197 

160 
194 
197 
197 

$0.  1861 
100 

.3110 
167 
.3300 
177 

124 
128 
122 
120 
133 
144 

145 
141 
140 
143 
169 
180 

125 
132 
142 
164 

141 

180 
171 

164 
164 
169 
177 

177 
172 
177 

181 
189 

188 

172 
170 
176 
186 

176 

176 
157 
141 
146 
M67 
177 

174 
2  161 
161 
161 
2156 
156 

160 
164 
166 
158 

101 

$0.  1550 
100 

.3425 
221 
.3350 
216 

94 
94 
94 
94 
103 
103 

116 
116 
123 
129 
137 
129 

94 
100 
118 
132 

111 

129 
129 
137 
161 
161 
177 

194 
194 
194 
194 
221 
221 

132 
167 
194 
212 

176 

221 
221 
221 
221 
221 
221 

1216 
216 
216 
216 
221 
221 

221 
221 
216 
219 

219 

$0.  0205 
100 

.0487 
238 
.0467 
228 

341 
366 
341 
341 
341 
390 

390 
390 
307 
341 

378 
378 

350 
358 
362 
366 

359 

378 
378 
378 
378 
322 
322 

322 

256 
250 
256 
238 
238 

378 
340 
278 
244 

310 

238 
238 
238 
238 
1228 
228 

228 

228 
228 
228 
228 
228 

238 
231 
228 

228 

231 

$0.  2438 
100 

.7120 
292 
.6650 
273 

105 
105 
104 
110 
112 
115 

116 
118 
125 
135 
149 
170 

104 
112 
120 
151 

122 

160 

152 
148 
168 
174 
180 

205 
205 
238 
197 
205 
217 

153 
174 
216 
206 

187 

238 
249 
257 
281 
289 
292 

i  288* 
287 
285 
285 
273 
242 

248 
287 

287 
267 

272 

$0.4121' 
100 

.6800 
165 
.6800 
165 

112 
112 
112 
114 
114 
119 

119 
119 
121 
121 
131 
155 

112 
116 
120 
136 

121 

163 
163 
163 
163 
163 
163 

163 
163 
163 
163 
163 
163 

163 
163 
163 
163 

163 

165 
165 
165 
165 
165 
U65 

165 
165 
165 
165 
165 
165 

165 
165 
165 
165 

165 

Market  price  when  control  be- 

Found  equal  to  

Found  equal  to  

1916—  Months- 
January         

February 

March             

April 

May 

July 

August  

September 

October 

November 

December 

Quarters- 
First  

Second              

Third  

Fourth 

Year                 

1917—  Months- 
January 

February  

March  , 

April 

May 

June 

July 

August 

September 

October  

November 

December.    . 

Quarters- 
First 

Second  

Third 

Fourth  

Year 

1918—  Months— 
January                 .  .  . 

February 

March  . 

April  

May.. 

June  

July 

August 

September  

October 

November  

December 

Quarters- 
First  

Second 

Third  

Fourth  

Year 

i 

Government  control  began  during  month.  "Government  revised  price  during  month. 


GOVERNMENT   CONTROL  OVER  PRICES. 


521 


RELATIVE   PRICES   OF   FIFTY  IMPORTANT  COMMODITIES. 

[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Clothing  group. 

Leather 
belting, 
butts, 
medium 
standard 
tannages, 
Philadel- 
phia 
(per  lb.). 

Printcloths, 
27in., 
64  by  60, 
7.60  yds., 
Boston 
(per  yd.). 

Rags, 
woolen, 
new  clips, 
blue 
worsted, 
New  York 
(per  lb.). 

Sheeting, 
Ware 
Shoals,L.L., 
brown, 
New  York 
(per  yd.). 

Wool, 
dom.,  Ohio, 
Penn., 
W.  Va., 
unwashed, 
fine 
delaine, 
Boston 
(per  lb.). 

Wool, 
Buenos 
Aires  46s, 
shrinkage 
34  per  cent, 
Boston 
(perlb.). 

Prewar  base  price  
Made  equal  to 

$0.  5042 
100 

.9700 
192 
.9600 
190 

149 
149 
155 
149 
157 
159 

159 
159 
157 
157 
169 
169 

151 
155 
158 
165 

157 

175 
175 
182 
182 

188 
188 

188 
188 
188 
188 
188 
188 

177 

186 

188 
188 

185 

188 
190 
188 
188 
186 
188 

192 
i  190 
190 
190 
190 
190 

189 

188 
191 
190 

190 

$0.  0335 
100 

.1300 
388 
.1125 
336 

101 
104 
106 
113 
117 
115 

115 
120 
134 

149 
164 

162 

104 
115 
123 
158 

125 

161 
152 
152 
159 
180 
207 

216 
213 
205 
222 
239 
254 

155 
167 
211 
239 

198 

265 
308 
355 
390 
382 
388 

1388 
371 
336 
336 
336 
287 

313 
387 
362 
316 

344 

$0.  1250 
100 

.5650 
452 
.6200 
496 

248 
276 
248 
236 
221 
224 

224 
220 
212 

188 
256 
252 

257 
228 
219 
232 

234 

276 
252 
254 
252 
250 
258 

258 
262 
256 
256 
296 
296 

261 
253 
259 
283 

264 

340 
340 
332 
332 
344 
360 

452 
M88 
496 
496 
496 
488 

337 
345 
479 
493 

414 

SO.  0606 
100 

.2300 
380 
1750 
'   289 

97 
99 
99 
103 
109 
109 

109 
120 
128 
140 
153 
163 

98 
107 
119 
152 

119 

163 
163 
169 
173 
182 
194 

198 
202 
202 
223 
231 
243 

165 
183 
201 
232 

195 

272 
289 
309 
371 
380 
380 

1380 
289 
297 
297 
297 
297 

290 
377 
322 
297 

321 

$0.  2317 
100 

.7500 
324 
.7500 
324 

140 
140 
145 
145 
145 
145 

149 
151 
155 

158 
170 
186 

142 
145 
152 
171 
152 

196 
211 
220 
231 
240 
304 

317 
322 
326 
324 
324 
324 

209 
258 
322 
324 

278 

324 
324 
324 
324 
1324 
319 

324 
324 
319 
319 
319 
293 

324 
322 
322 
311 

320 

$0.3083 
100 

.7400 
240 
.7400 
240 

136 
139 
143 
146 
149 
151 

152 
156 
162 
165 
169 
175 

139 
149 
157 
170 

154 

175 
178 
185 
190 
211 
227 

343 
343 
242 
240 
237 
240 

179 
211 
243 
239 

217 

240 
240 
240 
240 
1240 
240 

240 
240 
240 
240 
240 
257 

240 
240 
240 
246 

241 

Market  price  when  control 
began  

Found  equal  to       ... 

Government  price 

Found  equal  to  

1916—  Months- 
January    

February 

March  

April 

May  .. 

June 

July         

August 

September  

October 

November  

December 

Quarters- 
First 

Second  

Third 

Fourth 

Year 

1917  —  Months- 
January 

February  

March                 .  . 

April  

May 

June 

July 

August 

September 

November  .... 

December 

Quarters- 
First  

Second  

Third 

Fourth  

Year 

1918—  Months- 
January 

February   

March 

A  pril  

May 

June 

July 

August..:  

September     

October 

November  

December 

Quarters- 
First 

Second 

Third  

Fourth 

Year 

Government  control  began  during  month. 


522 


HISTORY   OF   PRICES   DURING   THE   WAR. 


LKLATIVE    TRICES   OF   FIFTY  IMPORTANT   COMMODITIES. 

[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.} 


Rubber,  paper,  fiber  group. 

Manila 
fiber,  fair 
current 
shipment. 
New  York 
(perlb.) 

Paper, 
newsprint, 
rolls,  car 
lots  United 
States 
average 
(per  cw  (  .  ) 

Rubber, 
crude, 
Hovoa,  first 
latex,  crepe 
New  York 
(perlb.) 

Prewar  base  price 

$0.  0780 
100 
.2731 
350 

.2600 
333 

143 
143 
138 
132 
122 
112 

109 
115 
115 
109 
97 
91 

141 
122 
113 
99 

119 

87 
99 
93 
90 
98 
95 

93 
95 
103 
95 
83 
90 

93 
94 
97 
89 

93 

99 
113 
123 
131 
125 
124 

119 
122 
116 
115 
127 
129 

112 
127 
119 
123 

120 

$1.9046 
100 
3.  2450 
170 
(3.1000] 
163  1 
3.5000[ 
184J 

101 
101 
101 
100 
101 
100 
101 
101 
100 
100 
100 
99 

101 
100 
100 
100 

100 

100 
100 
100 
100 
100 
99 

100 
100 
100 
100 
102 
102 

100 
100 
100 
101 

100 

100 
99 
99 
99 
99 
99 

99 
99 
99 
99 
99 
99 

100 
99 
99 
98 

99 

SO.  6123 
100 
.6000 
93 

.6300 
103 

175 
164 
149 
135 
132 
121 

114 
112 
96 
87 
93 
91 

163 
129 
107 
90 

122 

97 
102 
102 
112 
101 
93 

91 
139 
96 
95 
109 
130 

101 
102 
109 
111 

106 

119 
100 
105 
99 
98 
102 

105 
100 
97 
101 
122 
143 

108 
99 
101 
122 

10S 

Market  price  when  control  began     .                                            

Found  equal  to 

Government  price                                                                           • 

Found  equal  to                                                   

1913  -Months— 

February                                                                          .... 

March  .                                       .         

April 

Mav 

June 

Tuly 

September                                   .              .        

October 

November                                                  "                  

December 

Quarters- 
First 

Second                                                                   

Third                                   

Fourth 

Year                                                                       

1914—  Months— 

February                                              

March     .                       

April 

Mhv 

Juno                                      '                      

July                         

August                                                                         

September                     

October 

November                                

December 

Quarters- 
First                                                                              

Second                                 

Third 

Fourth                                       

Year                               

1915-Months- 
January                                                   

February             

March                                                              

April                                  

Mav 

J  une     .           .  .        

July        .             

August                      .                                             

Sopite  rnbor 

October                                                        

December                                                          

Quarters- 
first                                                             

Second 

Third                                                                

Fourth 

Year                  "                                                              .  . 

GOVERNMENT   CONTROL  OVER  PRICES. 


523 


RELATIVE    PRICES  OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Rubber,  paper,  fiber  group. 

Manila 
fiber,  fair 
current 
shipment, 
New  York 
(perlb.) 

Paper, 
newsprint, 
rolls,  car 
lots  United 
States 
average 
(percwt.) 

Rubber, 
crude, 
Hevea,  first 
latex,  crepe 
New  York 
(perlb.) 

Prewar  base  price  

SO.  0780 
100 
.2731 
350 

.2600 
333 

149 
175 
172 
166 
166 
159 

160 
156 
148 
143 
139 
173 

166 
164 
155 
152 

159 

202 
205 
203 
235 
256 
308 

327 
329 
321 
321 
314 
349 

203 
266 
325 
328 

284 

366 
350 
1333 
333 
333 
333 

2333 
305 
293 
280 
240 
199 

350 
333 
311 

240 

308 

$1.9046 
100 
3.2450 
170 
!3.  1000] 
163  1 
3.  5000  f 
184J 

100 
99 
100 
101 
102 
105 

108 
112 
115 
118 
116 
126 

100 
103 
111 
120 

108 

150 
162 
169 
168 
168 
167 

167 
167 
170 
167 
164 
162 

160 

168 
168 
164 

165 

170 
169 
170 
U73 

2191 

191 

2195 
193 
196 
197 
197 
197 

170 
185 
195 
197 

18G 

$0.6123 
100 
.6000 
98 

.6300 
103 

146 
140 
147 
136 
117 
105 

95 
95 
98 
102 
112 
129 

145 
119 
96 
114 

191 

127 
140 
139 
134 
135 
118 

111 

106 
109 
104 
98 
91 

135 
129 

109 
98 

118 

100 
86 
91 
98 
U03 
103 

103 
103 
103 
103 
100 
100 

92 
101 
103 

101 

99 

Made  equal  to 

Market  price  when  control  began 

Found  equal  to  .                                                         

Governtnont  price 

Found  equal  to 

1916—  Months- 
January 

February 

March... 

April 

May  

June  .. 

July.. 

August  .             .          

September 

October 

November. 

December 

Quarters- 
First 

Second  

Third. 

Fourth  

Year.  .. 

1917—  Months- 
January 

February  

March  .  . 

April 

May.... 

June 

July.... 

August- 

September.. 

October 

November  

December 

Quarters- 
First  

Second  . 

Third  

Fourth.  .. 

Year  

1918-Months— 
January  

February.  . 

March  . 

April  .... 

Mav  .. 

June  

July  

August 

September  

October 

November  

December 

Quarters- 
First  

Second                                                  / 

Third  

Fourth  .  . 

Year  

Government  control  began  during  month. 


2  Government  revised  price  curirg  month. 


524 


HISTORY   OF   PRICES   DURING  THE   WAR. 


RELATIVE   PRICES   OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


] 

tfetal  group. 

Copper, 
electro- 
lytic, 
New  York 
(perlb.). 

Iron  ore, 

Mesabi, 
non-Bes- 
semer, 51  £ 
per  cent 
lower  lake 
ports  (per 
gr.  ton). 

Lead,  pig, 
New  York 
(perlb.). 

Pig  iron, 
basic,  Ma- 
honing  or 
Shenango 
Valley 
furnace 
(per  gr. 
ton). 

Quick- 
silver, 
New  York 
(per  flask 
of  75  Ibs.). 

Prewar  base  price  

$0.  1492 

$3.  3083 

$0.  0418 

$13.3183 

$38.  8558 

Made  equal  to_ 

100 

100 

100 

100 

100 

Market  price  when  control  began  

.2545 

5.0500 

.0625 

42.  7500 

121.7500 

Found  equal  to 

171 

153 

150 

321 

313 

Government  price  

.2350 

5.0500 

.0805 

33.0000 

105.  0000 

Found  equal  to 

158 

153 

193 

248 

270 

1913—  Months- 
January 

112 

103 

103 

123 

103 

February  

102 

103 

104 

122 

103 

March 

100 

103 

104 

121 

102 

April... 

104 

103 

105 

119 

101 

May 

105 

103 

104 

114 

102 

June  

100 

103 

104 

109 

103 

July 

98 

103 

104 

108 

103 

August  

105 

103 

111 

106 

103 

September 

111 

103 

112 

105 

101 

October  

111 

103 

105 

104 

99 

November 

104 

103 

103 

98 

100 

December  

97 

103 

97 

95 

102 

Quarters- 
First  

105 

103 

103 

122 

103 

Second 

103 

103 

104 

114 

102 

Third  

105 

103 

109 

106 

102 

Fourth  . 

104 

103 

102 

99 

100 

Year  .                   .  .. 

104 

103 

105 

110 

102 

1914—  Months- 
January  

97 

103 

98 

94 

100 

February. 

98 

103 

97 

99 

100 

March 

96 

103 

95 

98 

99 

April  

96 

103 

91 

98 

98 

May 

95 

86 

93 

98 

98 

June... 

93 

86 

93 

98 

98 

July  

90 

86 

93 

98 

95 

August 

83 

86 

93 

98 

214 

September  

81 

86 

92 

98 

191 

October 

76 

86 

84 

96 

138 

November  

79 

86 

88 

94 

129 

December 

87 

86 

91 

94 

132 

Quarters- 
First 

97 

103 

97 

97 

100 

Second  

95 

92 

93 

98 

98 

Third  . 

85 

86 

92 

98 

167 

Fourth  ?  

81 

86 

88 

95 

133 

Year  

89 

92 

92 

97 

124 

1915—  Months— 
January 

92 

86 

89 

94 

133 

February... 

98 

86 

92 

94 

153 

March 

100 

'86 

97 

94 

188 

April 

115 

86 

101 

94 

184 

May  . 

125 

86 

102 

94 

199 

June 

132 

86 

142 

95 

246 

July. 

128 

85 

135 

96 

249 

August  

115 

85 

111 

106 

236 

September  

119 

85 

110 

111 

230 

October  

120 

85 

110 

113 

244 

November 

126 

85 

123 

118 

278 

December  

136 

85 

128 

131 

347 

Quarters- 
First  

97 

86 

93 

94 

158 

Second 

124 

•  86 

115 

94 

210 

Third  

121 

85 

119 

104 

238 

Fourth  . 

127 

85 

121 

121 

290 

Year 

117 

85 

112 

103 

224 

GOVERNMENT   CONTROL  OVER  PRICES. 


525 


RELATIVE   PRICES   OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Metal  group. 


Copper, 
electro- 
lytic, 
New  York 
(perlb.)- 


Iron  ore, 
Mesabi, 
non-Bes- 
semer, 51| 
per  cent 
[ower  lake 
ports  (per 
gr.  ton). 


Lead,  pig, 
New  York 
(perlb.). 


Pig  iron, 
basic,  Ma- 
honing  or 
Shenango 
Valley 
furnace 
(per  gr. 
ton). 


Quick- 
silver, 
New  York 
(per  flask 
of  75  Ibs.). 


Prewar  base  price $0.1492 

Made  equal  to 100 

Market  price  when  control  began .  2545 

Found  equal  to 171 

Government  price .  2350 

Found  equal  to 158 

1916— Months- 
January  162 

February 184 

March 184 

April 196 

May 200 

June 184 

July 172 

August 183 

September 189 

October 192 

November 216 

December 227 

Quarters- 
First  1 76 

Second 193 

Third ..  182 

Fourth 212 

Year 191 

1917— Months- 
January 203 

February 236 

March 240 

April 216 

May 217 

June. 218 

July 194 

August 182 

September 1 17-1 

<  'ctober 158 

November 158 

December 158 

Quarters- 
First  226 

Second 217 

Third 182 

Fourth 158 

Year 196 

1918— Months- 
January  158 

February 158 

March 158 

April 158 

May 158 

June. 158 

July 2 174 

August 174 

September 174 

October 174 

November 174 

December 170 

Quarters- 
First 158 

Second 158 

Third 174 

Fourth 173 

Year....  165 


$3. 3083 
100 

5.0500 
153 

5.0500 
153 


107 
107 
107 
107 
107 
107 

107 
107 
107 
107 
107 
153 

107 
107 
107 
122 

111 


153 
153 
153 
153 
153 
153 

153 
153 
U53 
153 
153 
153 

153 
153 
153 
153 

153 


153 
153 
153 
153 
153 
153 

2153 
166 
166 

2174 
174 
174 

153 
153 
162 
174 

160 


$0. 0418 
100 

.0625 
150 

.0805 
193 


142 
150 
171 
183 

178 
166 

152 

149 
163 
167 
168 
180 

154 
176 
155 
172 
164 

183 

207 
220 
222 
244 
267 

256 
253 
208 
161 
U50 
153 

203 
244 
239 
154 

210 


162 
167 
172 
102 
163 
182 
102 
l'J3 
193 
193 
]«)3 
157 

167 

169 
192 
181 

177 


$13.3183 
100 

42.7500 
321 

33.0000 
248 


134 
133 
137 
136 
135 
135 

135 
135 
137 
149 

188 
225 

134 
135 
136 
188 
148 


225 
225 
242 
291 
312 
366 

394 

384 

1321 

248 
248 
248 

230 

322 
368 
248 

292 


248 
248 
248 
2240 
240 
240 

240 
240 
240 
2248 
248 
248 

248 
240 
240 
248 

244 


Governmentcontrol  began  during  month. 


2  Government  revised  price  during  month. 


526  HISTORY  OF   PRICES   DURING  THE   WAR. 

RELATIVE   PRICES   OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Metal  group. 

Steel  bars, 
base, 
Pittsburgh 
(percwt.). 

Steel  bil- 
lets, open- 
hearth, 
Pittsburgh 
(per  gr. 
ton). 

Steel 
plates, 
tank, 
Pittsburgh 
(percwt.). 

Steel, 
structural 
shapes, 
Chicago 
(per  cwt.). 

Tin  plate, 
dom.  coke, 
14  bv  20  in. 
Pittsburgh 
(per  ioo-lb. 
base  box). 

Zinc 
sheets, 
f.  o.  b.  La 
Salle  or 
Peru,  in. 
(perlb.). 

Prewar  base  price           .  

$1.2600 
100 

3.  8800 
308 
2.9000 
230 

111 
111 
111 
111 
111 
111 

111 
111 
111 
110 
103 
97 

111 
111 
111 
103 

110 

95 
97 
95 
91 
90 
89 

89 
94 
94 
91 

88 
83 

96 
90 
92 
88 

91 

87 
87 
91 
95 
95 
95 

101 
103 
107 
113 
129 
139 

89 
95 
104 
127 

104 

$:i.7917 
100 

55.  2500 
254 
47.  5000 
218 

131 
133 
133 
126 
124 
122 

122 
118 
110 
103 
94 
92 

132 
124 
"117 

96 

117 

92 

96 
96 
95 
92 
89 

89 
93 
95 
92 
88 
87 

95 
92 
92 

89 

92 

87 
88 
89 
89 
89 
93 

103 
112 
123 
124 
125 
151 

88 
91 
113 
133 

106 

$1.2600 
100 

7.0500 
560 
3.  2500 
258 

119 
115 
115 
115 
115 
115 

115 
114 
111 

108 
102 

95 

116 
115 
113 
102 

112 

95 
96 
94 
91 
90 
87 

88 
94 
94 
90 

87 
83 

95 
90 
92 

87 

90 

87 
87 
91 
95 
93 
91 

97 
100 
106 
113 
129 
139 

89 
93 
101 
127 

102 

$1.4600 
100 

5.  1900 
355 
3.0000 
205 

112 
112 
112 
112 
112 
112 

112 
112 
112 
109 
108 
97 

112 
112 
112 
105 

110 

92 
95 
95 
91 

88 
88 

88 
94 
95 
92 
87 
82 

94 

89 
92 

87 

90 

88 
88 
91 
92 
94 
95 

98 
102 
105 
108 
123 
134 

89 
94 
102 
121 

101 

S3.  4375 
100 

12.0000 
349 

7.  7500 
225 

105 
105 
105 
105 
105 
105 

105 
105 
102 
102 
102 
99 

105 
105 
104 
101 

104 

99 
97 
97 
97 
97 
97 

97 
97 
107 
100 
93 
95 

98 
97 
101 
96 

98 

92 
92 
92 
96 
96 
96 

92 
92 
92 
92 
92 
105 

92 
96 
92 
96 

94 

$0.  0735 

100 

.1800 
245 
.1500 
204 

122 
117 
112 
107 
104 
99 

109- 
109 
104 
102 
99 

117 
103 
104 
102 

107 

101 
99 
97 
95 
95 
95 

95 
100 
116 
110 
109 
116 

99 
95 
104 
112 

102 

126 
168 
184 
192 
260 
398 

367 
256 
218 
218 
272 
299 

159 
284 
280 
263 

247 

Market  price  when  control 
began                 

Found  eoua.1  to          ... 

Found  equal  to       

1913—  Months— 

February            

\pril                

May 

June              

July                  

October                 -  

December           

Quarters- 
First         

Second                   .... 

Third 

Fourth               

Year                           -  -• 

1914—  Months— 

March  

May       

June 

JUly       

August 

September 

October 

November  .... 

December 

Quarters- 
First  

Second  . 

Third  

Fourth 

Year 

1915—  Months- 
January  

February 

March  

April 

May... 

June 

July  

August 

September  .  .  . 

October 

November  

December 

Quarters-  - 
First 

Second  

Third                    i 

Fourth  :... 

Year  

GOVERNMENT   CONTROL   OVER   PRICES. 

RELATIVE   PRICES   OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


527 


Metal  group. 

Steel  bars, 
base, 
Pittsburgh 
(per  c\vt.). 

Steel  bil- 
lets, open- 
hearth, 
Pittsburgh 
(per  gr. 
ton). 

Steel             St&l, 
plates,        structural 
!tank,           shapes, 
Pittsburgh      Chicago 
(percwt.).    (percwt.). 

Tin  plate, 
dom.  coke, 
14  by  20  in. 
Pittsburgh 
(per  100-lb. 
base  box). 

Zinc 

sheets, 
f.  o.  b.  La 
Salle  or 
Peru,  111. 
(perlb.)> 

Prewar  base  price 

$1.2600 
100 

3.  8800 
308 
2.9000 
230 

148 
163 
187 
198 
198 
198 

186 
203 
206 
208 
219 
233 

166 
198 
203 
220 

197 

238 
238 
260 
269 
289 
317 

357 
357 
*308 
230 
230 
230 

245 
292 
341 
230 

277 

230 
230 
230 
230 
230 
230 

230 
230 
230 
230 
230 
221 

230 
230 
230 
227 

229 

$21.7917 
100 

55.  2500 
254 
47.  5000 
218 

163 
170 
190 

206 
197 
195 

204 
213 
216 
220 
242 
262 

174 
200 
211 
241 

207 

291 
298 
312 
344 
404 
436 

436 
385 
321 
1254 
218 
218 

301 
395 
381 
230 

326 

218 
218 
218 
218 

218 

218 

ftl 

218 
218 
218 
218 
207 

218 
218 
218 

214 

217 

$1.2600 
100 

7.0500 
560 
3.  2500 
258 

151 
171 
201 
218 
225 
230 

230 
233 
238 
244 
264 
280 

174 

224 
234 

263 

224 

287 
298 
344 
357 
357 
563 
714 
711 
1560 
258 
258 
258 

309 
426 
662 
258 

413 

258 
258 
258 
258 
258 
258 

258 
258 
258 
258 
258 
246 

258 
258 
258 
254 

257 

51.4600 
100 

5.1900 
355 
3.  0000 
205 

163 
167 
177 
188 
191 
191 

191 
198 
201 
201 
218 
236 

169 
190 
197 
218 

194 

236 
244 
255 
260 
316 
397 

424 
424 
1355 
205 
205 
205 

245 
324 
401 
205 

294 

205 
205 
205 
205 
205 
205 

205 
205 
205 
205 
205 
197 

205 
205 
205 
203 

205 

53.4375 
100 

12.0000 
349 
7.  7500 
225 

107 
111 
116 
131 

131 

167 

171 
171 
171 
171 
171 
171 

112 
143 
171 
171 

149 

204 
204 
218 
233 
233 
247 

349 
349 
349 
349 
!225 
225 

208 
238 
349 

267 

265 

225 
225 
225 
225 
225 
225 

225 
225 
225 
225 
225 
218 

225 
225 
225 
223 

225 

SO.  0735 
100 

.1800 
245 
.1500 

20  ^ 

318 
333 
340 
343 
327 
265 

212 
204 
204 
207 
248 
2i6 

331 
312 

207 

21 

274 

286 

286 
286 
278 
259 
259 

f    259 
259 
259 
259 
259 
259 

286 
265 
259 
259 

267 

259 
'245 
204 
204 
204 
204 

204 
204 
204 
204 
204 
204 

236 
204 
204 
204 

212 

Made  equal  to               ... 

Market  price  when  control 
began                      

Found  equal  to             

Government  price  

Found  equal  to   

1916—  Months- 
January              .      .  . 

February 

March       

April 

Mav 

June          

July  

August      .  .          ... 

September  

October  

November 

December  

Quarters- 
First      

Second 

Third 

Fourth      .... 

Tear               

1917—  Months- 
January  

February 

March 

April  

May 

June  

July 

August 

September  .  . 

October 

November  

December. 

Quarters- 
First  .... 

Second 

Third  

Fourth 

Year  

1918—  Months- 
January  

February  . 

March 

April... 

May 

June 

July   

August 

September  

October  .  .  . 

November 

December  

Quarters- 
First 

Second... 

Third  .. 

Fourth 

Year 

Government  control  began  during  month. 


528 


HISTORY   OF   PRICES   DURING   THE   WAR. 


RELATIVE   PRICES   OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Fuel  Group.                               Building  Materials  Group. 

Coal, 
anth- 
racite, 
chest- 
nut, 
New 
York 
(per 
long 
ton.) 

Coal, 

bitumi- 
nous, 
Pitts- 
burgh, 
No.  8 
Ohio, 
Colum- 
bus anc 
Detroit 
(per 
short 
ton). 

Coke, 
Con- 
nells- 
ville 
furnace 
f.  o.  b. 
ovens 
(per 
short 
ton). 

Petro- 
leum, 
crude, 
Mid- 
conti- 
nent 
(Ivans. 
Okla.) 
at  wells 

bbSo 

I 

Cement, 
Port- 
land, 
domes- 
tic, 
New 
York 
(per 
bbl.) 

Doug- 
las fir 
com- 
mon, 
No.  1, 
Iby8 
by  10 
Wash- 
ington 
mills 
(perM 
bd.  ft.) 

Penna. 
hem- 
lock, 
No.  1 
boards. 
1  by 
10-16 
f.  o.  b. 
mill 
(perM 
bd.  ft.  ) 

South- 
ern or 
yellow 
pine, 
com- 
mon 
boards 
No.  1, 
S-2-S 
1  by  10 
inches 
Ark. 
(perM 
ibd.  ft.) 

New 
Eng- 
land 
spruce, 
ran- 
dom, 
2  by  10 
Boston 
(perM 
bd.  ft.) 

$24.  2600 
100 
46.3700 

191 
45.  0000 
185 

19 
104 
104 
106 
106 
104 

101 
100 
100 
100 
100 
100 

103 
105 
100 
100 

102 

100 
100 
100 
100 
100 
90 

98 
98 
97 
96 
96 
98 

100 
100 
98 
97 

99 

98 
97 
97 
98 
98 
97 

96 
96 
96 
96 
99 
106 

97 
98 
96 
100 

98 

Prewar  rTase  price  

$3.  7800 
100 
4.  9000 

130 
4.8000 
127 

107 
104 
101 
90 
92 
94 

96 
100 
103 
103 
103 
103 

104 
92 
99 
103 

99 

103 
163 
103 
93 
95 
97 

99 
112 
105 
105 
105 
105 

103 
95 
102 
105 

101 

105 
105 
104 
93 
94 
96 

99 

102 
104 
105 
106 
106 

104 
94 
102 
105 

102 

$1.0900 
100 
2.  5400 

233 
2.  0000 
183 

113 
98 
93 
97 
% 
94 

92 
99 
100 
106 
115 
100 

101 
96 
97 
107 

100 

98 
99 
99 
99 
97 
97 

95 
91 
91 
96 
102 
102 

99 
98 
92 
100 

97 

103 
105 
95 
94 
88 
90 

89 
94 
95 
•98 
97 
100 

101 
91 
92 
99 

96 

$2.  0625 
100 
11.7500 

570 
6.  0000 
291 

178 
149 
124 
113 
104 
107 

115 
121 
119 
105 
93 
91 

1.50 

108 
118 
97 

118 

93 
93 
91 
93 
93 
91 

91 

87 
84 
81 
75 
79 

93 
93 

87 
78 

88 

79 
76 
76 
79 
79 
79 

85 
81 
81 
97 
115 
112 

77 
79 
82 
108 

87 

$0.9725 
100 
2.  2500 

231 

$1.  5800 
100 
2.  5600 

162 
1.8500 
117 

100 
100 
100 
100. 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100  : 
100 
91 
89 
89 
85 

85 
85 
90 
90 
90 
111 

97 
87 
86 
97 

92 

$7.9167 
100 
18.  5000 

234 
18.  5000 
234 

120 
133 
133 
139 
133 
120 

107 
107 
101 
101 
101 
101 

128 
131 
105 
101 

116 

101 
101 
107 
101 
101 
101 

101 
107 
101 
95 
95 
88 

103 
101 
103 
93 

100 

95 
95 
101 
95 
95 
95 

95 
95 
101 
101 
107 
120 

97 
95 
97 
109 

99 

$24.  8300 
100 
32.  6200 

131 
32.  0000 
129 

95 
96 
100 
101 
101 
101 

101 
101 
101 
100 
100 
100 

97 
101 
101 
100 

100 

100 
101 
101 
101 
102 
94 

94 
94 
94 
94 
94 
93 

100 
99 
94 
94 

97 

93 
89 
89 
90 
90 
90 

89 
89 
89 
90 
94 
98 

91 
90 
89 
94 

91 

$13.8750 
100 
27.  5000 

1980 
24.000 
173 

Made  equal  to 

Market  price  when  control 
began 

Found  equal  to  

Government  price 

Found  equal  to  

1913—  Months- 
January  
February  

85 
90 
90 
90 
90 
90 

94 
102 
105 
105 
105 
105 

89 
90 
101 
105 

97 

105 
107 
107 
102 
76 
76 

76 
76 
66 
56 
56 
56 

107 
86 
74 
56 

81 

56 
56 
41 
41 
41 
41 

41 
51 
76 
82 
82 
102 

51 
41 

57 
89 

60 

March  

April 

May  .. 

June  

July 

105 
105 
105 
97 
97 
97 

August 

September  

October  

November. 

December 

Quarters  — 
First  

Second 

""16,5" 
97 
101 

101 
101 
101 
97 
97 
97 

94 
94 
94 
101 
101 
101 

101 
97 
94 
101 

98 

97 
97 
97 
101 
101 
101 

101 
101 
101 
130 
130 
130 

97 
101 
101 
130 

107 

Third 

Fourth  . 

Year  

1914—  Months  - 
January 

February  

March 

April... 

May 

June 

July  

August  . 

September  . 

October  

I'ovember 

December  ... 

Quarters- 
First  

Second  
Third  

Fourth 

Year..  . 

1915—  Months- 
January  

February. 

March 

April  .  . 

May 

June  

July  

August 

September 

October.   .. 

November 

December  

Quarters- 
First  

Second...  
Third.... 

Fourth  

Year.... 

GOVERNMENT  CONTROL  OVER  PRICES. 


529 


RELATIVE   PRICES  OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.  ] 


Fuel  Group. 

Building  Materials  Group. 

Coal 
anth- 
racite, 
chest- 
nut, 
New 
York 
(per 
long 
ton.) 

Coal, 
bitumi- 
nous, 
Pitts- 
burgh, 
No.  8 
Ohio, 
Colum- 
bus and 
Detroit 
(per 
short 
ton). 

Coke, 
Con- 
nells- 
ville 
furnace, 
f.  o.  b. 
ovens 
(per 
short 
ton). 

Petro- 
leum, 
crude, 
Mid- 
conti- 
nent 
(Kans.- 
Okla.) 
at  wells 
(per 
bill.) 

Cement 
Port- 
land, 
domes- 
tic, 
New 
York 

£T, 

Doug- 
las fir 
com- 
mon, 
No.  1, 
Iby8 
by  10 
Wash- 
ington 
mills 
(perM 
bd.  ft.) 

Penna. 
hem- 
lock, 
No.  1 
boards, 
Iby 
10-16 
f.  o.  b. 
mill 
(perM 
m.  ft.) 

South- 
ern or 
yellow 
pine, 
com- 
mon 
boards, 
No.  1, 
S-2-S 
Iby  10 
inches 
Ark. 
(perM 
bd.  ft.) 

New 
Eng- 
land 
spruce, 
ran- 
dom, 
2  by  10 
Boston 
(perM 
bcL  ft.) 

Prewar  base  price  

$3.  7800 
100 
4.9000 

130 
4.  8000 
127 

106 
106 
106 
109 
105 
107 

109 
122 
115 
119 
140 
128 

106 
107 
112 
129 
113 

129 
129 
122 
106 
128 
122 

124 
130 
M32 
132 
132 
141 

126 
119 
128 
135 

127 

141 
141 
141 
133 
133 
133 

133 
133 
141 
«  141 
169 
169 

141 
133 
136 
160 
143 

$1.0900 
100 
2.5400 

233 

2.0000 
183 

96 
97 
95 
102 
102 
103 

103 
103 
123 
228 
42o 
366 

96 
102 
109 
340 
162 

442 
438 
335 
248 
374 
392 

269 
1269 
184 
184 
224 
224 

405 
338 
240 
211 
299 

224 
224 
224 
224 
2  224 
3215 

219 
219 
219 
219 
219 
219 

224 
222 
219 
219 
221 

$2.0625 
100 
11.7500 

570 
6.  0000 
291 

139 
127 
145 
137 
115 
127 

127 

127 
133 
152 
279 
279 

137 
126 
129 
236 
157 

352 

364 
412 
352 
339 
461 

594 
485 
1570 
291 
291 
291 

376 
384 
549 
291 
400 

291 
291 
291 
291 
291 
291 

291 
291 
291 
291 
291 
291 

291 
291 
291 
291 
291 

$0.9725 
100 
2.  2500 

231 

$1.5800 
100 
2.5600 

162 

1.8500 
117 

106 
106 
106 
106 
106 
106 

106 
106 
106 
106 
106 
120 

106 
106 
106 
110 
107 

122 

128 
128 
136 
136 
136 

134 
134 
134 
134 
134 
1134 

126 
136 
134 
134 
133 

136 

136 
136 
149 
2162 
164 

165 
165 

184 
203 
203 
203 

136 
159 
170 
203 
167 

$7.9167 
100 
18.5000 

234 
18.5000 
234 

126 
133 
145 
145 
145 
139 

126 
120 
114 
114 
126 
139 

13") 
143 
120 
126 
131 

145 
152 
152 
164 
208 
234 

234 
234 
234 
208 
208 
1234 

149 
202 
234 
217 
201 

234 
234 
234 
234 
234 
2  234 

246 
246 
2  246 
208 
208 
208 

234 
234 
246 
208 
231 

$24.8300 
100 
32.6200 

131 
32.0000 
129 

97 
97 
99 
99 
99 
99 

99 
100 
100 
100 
103 
103 

98 
99 
100 
102 
100 

103 
107 
107 
111 
116 
130 

130 
129 
129 
129 
129 
128 

106 
119 
129 
129 
121 

132 
132 
131 
'131 
129 
129 

129 
2  129 
137 
137 
137 
137 

131 
130 
132 
137 
132 

$13.8750 
100 
27.5000 

198 
24.0000 
173 

130 
130 
130 
117 
117 
117 

123 
123 
123 
133 
133 
133 

130 
117 
123 
133 
126 

137 
137 
137 
191 
191 
191 

184 
184 
184 
198 
M98 
198 

137 
191 

184 
198 
177 

«202 
202 
202 
205 
205 
2  205 

213 
213 
213 
213 
213 
213 

202 
205 
213 
213 
208 

$24.  2600 
100 
46.  3700 

191 
45.0000 
185 

107 
110 
110 
110 
110 
108 

107 
108 
113 
114 
118 
130 

109 
109 
109 
121 
112 

130 
137 
144 
146 
146 
142 

138 
136 
151 

Made  equal  to 

Market  price  when  control 
began  
Found  equal  to  

Government  price 

Found  equal  to 

1916—  Months- 
January   . 

125 
133 
151 
158 
158 
158 

155 
106 
92 
92 
93 
117 

137 
158 
119 
101 
129 

143 
173 
173 
173 
173 
173 

173 
173 
204 
204 
204 
204 

165 
173 
184 
204 
182 

204 

204 
204 
229 
3  229 
229 

229 
1229 
229 
229 
229 
229 

204 
229 
229 
229 

224 

February 

March 

April  .  . 

May 

June 

July 

August 

September  

October  

November. 

December 

Quarters  - 
First 

Second  .  .  . 

Third  

Fourth 

Xear.... 

1917—  Months- 
January 

February 

March  

April  . 

Mav 

June 

July  

August  

September...  . 

October 

November 

166 
164 

145 
137 
142 
165 
146 

163 
168 
181 
1191 
190 
188 

"188 

188 
188 
188 
188 
188 

172 
190 

188 
188 
184 

December 

Quarters- 
First  

Second  

Third.... 

Fourth 

Year.... 

1918—  Months- 
January 

February.  .  . 

March  

April. 

Mav 

June 

July 

August 

September... 

October 

November. 

December  

Quarters  — 
First 

Second 

Third.... 

Fourth  . 

Year  

i  Government  control  began  during  month. 
a  Government  revised  price  during  month. 

125547—19 34 


•  Prices  fixed  August  10, 1918,  retroactive  to  May,  1918. 


530 


HISTORY   OF   PRICES   DURING   THE   WAR. 


RELATIVE    PRICES   OF   FIFTY  IMPORTANT  COMMODITIES. 
[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 

Chemicals  group. 


Alcohol, 
wood, 
refined,  95 
per  cent, 
New  York 
(per  gal.). 

Arsenic, 
white, 
New  York 
(perlb.). 

Caustic 
soda,  76 
per  cent 
spot, 
New  York 
(perlb.). 

Nitrate  of 
soda,  95 
per  cent, 
New  York 
(percwt.). 

Sulphuric 
acid, 
60°  Be., 
New  York 
(perlb.). 

Prewar  base  price  ...    .  .                

$0.4558 

$0.0310 

$0.0181 

$2.3183 

$0.0085 

Made  equal  to 

100 

100 

100 

100 

100 

Market  price  when  control  began 

1.3500 

.1600 

.0490 

4.4938 

0125 

Found  equal  to 

296 

516 

271 

194 

147 

Government  price  

.7900 

.0900 

.0350 

4.2250 

.0090 

Found  equal  to.         

173 

290 

193 

182 

106 

1913—  Months- 
January                                     .  -  - 

110 

161 

100 

112 

100 

110 

153 

100 

112 

100 

March    *                    

110 

137 

105 

113 

100 

April 

108 

133 

105 

113 

100 

May 

108 

129 

103 

113 

100 

June  .          

108 

113 

103 

113 

100 

July                    

108 

109 

103 

110 

100 

August                              .             -  - 

99 

109 

103 

110 

100 

September 

99 

103 

96 

106 

100 

October     ...           

101 

103 

100 

104 

100 

November 

101 

97 

100 

101 

100 

December 

101 

101 

100 

95 

100 

Quarters  — 
First     .. 

110 

151 

102 

113 

100 

Second 

108 

125 

104 

113 

100 

Third....                 

102 

107 

101 

109 

100 

Fourth 

101 

100 

100 

100 

100 

Year                        

105 

121 

102 

109 

100 

1914—  Months- 
January 

99 

93 

100 

93 

100 

February  .  .             

99 

97 

100 

96 

100 

March 

99 

97 

100 

97 

100 

April  .  . 

99 

97 

100 

96 

100 

May 

99 

97 

100 

97 

100 

June 

99 

97 

ICO 

96 

100 

July 

99 

97 

100 

93 

100 

August  

99 

90 

100 

90 

100 

September 

99 

161 

100 

92 

100 

October 

99 

161 

102 

86 

100 

November.            '.  .  .  . 

99 

145 

102 

82 

100 

December 

99 

129 

102 

82 

100 

Quarters- 
First 

99 

95 

100 

95 

100 

Second 

99 

97 

100 

96 

100 

Third 

99 

116 

100 

91 

100 

Fourth  

99 

145 

102 

83 

100 

Year  

99 

114 

101 

92 

100 

1915—  Months- 
January  .  . 

99 

129 

102 

82 

100 

February 

99 

129 

98 

82 

100 

March 

99 

129 

98 

82 

100 

April 

99 

129 

112 

95 

100 

May  " 

99 

129 

129 

99 

100 

June... 

99 

121 

129 

99 

100 

July                                         .    .  . 

99 

121 

192 

101 

100 

August 

99 

113 

262 

106 

100 

September... 

99 

121 

262 

101 

118 

October  . 

99 

113 

290 

110 

118 

November 

110 

113 

290 

125 

118 

December  

110 

113 

290 

125 

118 

Quarters- 
First 

99 

129 

99 

82 

100 

Second 

99 

126 

124 

98 

100 

Third  

99 

118 

239 

103 

106 

Fourth..                                .  . 

106 

113 

290 

120 

118 

101 

122 

188 

101 

106 

GOVERNMENT  CONTROL  OVER  PRICES. 


531 


RELATIVE   PRICES  OF   FIFTY  IMPORTANT  COMMODITIES. 

[Arranged  to  show  relative  points  below  which  basic  prices  were  pegged.] 


Chemicals  group. 


Alcohol, 

wood, 

refined,  95 

per  cent, 
New  York 
(per  gal.). 


Arsenic, 

white, 

New  York 

(perlb.). 


Caustic 
soda,  76 
per  cent 

spot, 

New  York 
(perlb.). 


Nitrate  of 
soda,  95 
per  cent, 
New  York 
(percwt.). 


Sulphuric 

acid, 

60°  Be., 

New  York 

(perlb.). 


Prewar  base  price $0.4558 

Made  equal  to 100 

Market  price  when  control  began 1.3500 

Found  equal  to 296 

Government  price .7900 

Found  equal  to 173 

1916— Months- 
January 121 

February 132 

March 143 

April 143 

May 143 

June 143 

July 143 

August 143 

September 143 

October 154 

November 165 

December 197 

Quarters- 
First 132 

Second 143 

Third 143 

Fourth 172 

Year 147 

1917— Months- 
January  197 

February 219 

March 219 

April 219 

May 219 

June 219 

July 219 

August 219 

September 219 

October 241 

November 263 

December i  296 

Quarters- 
First 212 

Second 219 

Third 219 

Fourth 267 

Year 229 

1918— Months- 
January 296 

February 296 

March 296 

April 199 

May 199 

June 199 

July 202 

August 201 

September 201 

October 201 

November 201 

December 201 

Quarters- 
First 296 

Second 199 

Third 201 

Fourth 201 

Year....  224 


$0.0310 
100 
.1600 
516 
.0900 
290 


145 
161 
177 
210 
210 
202 


194 
194 
185 
194 
234 


161 
207 
195 

204 

192 

266 
339 
403 
548 
581 
581 

581 
548 
581 
516 
548 
532 


570 
570 
532 

502 


516 

1516 

290 


298 
298 
290 
290 
290 


441 

296 
298 
290 

331 


$0.0181 
100 

.0490 
271 

.0350 
193 


845 

352 
339 
304 

276 

249 
193 
193 
214 
221 


306 
212 


270 

242 
235 
235 
242 
318 
345 

387 
398 
497 
470 
428 
428 

237 
302 
427 
442 


199 
320 
271 
1271 
249 
262 

214 
215 
235 
249 
235 
229 

264 
261 
222 
238 

246 


$2.3183 

100 

4.4938 

194 

4.2250 

182 


140 
147 
155 
147 
147 
134 

134 
134 
129 
125 
125 
129 


147 
142 
132 
127 

137 


143 

158 
162 
164 
172 

179 
183 
198 
204 
201 
196 

148 
166 
185 
200 

175 

U94 
191 
194 
221 
222 
194 

2213 
2216 
2208 
2187 
2190 
2190 

193 
213 
213 


202 


Government  control  began  during  month.          2  Government  revised  price  during  month. 


532  HISTORY  OF  PRICES  DURING  THE  WAR. 

5.  A  COMPARISON  OF  CONTROLLED  RAW-MATERIAL 
PRICES  WITH  THE  PRICES  OF  THEIR  UNCONTROLLED 
MANUFACTURED  PRODUCTS. 

The  theory  underlying  practically  all  of  our  Government  regulation 
over  prices  was  that  stabilization  among  the  prices  of  manufactures 
would  result  from  a  control  simply  of  the  basic  raw  materials.  It 
was  appreciated,  of  course,  that  for  a  rigid  exercise  of  control,  regula- 
tion must  also  be  extended  over  the  products  of  manufactures. 
But,  by  and  large,  the  Government  was  content  to  fix  maximum 
prices  for  the  basic  raw  materials  and  leave  their  finished  products 
to  adjust  themselves  in  price  as  they  would. l 

It  is  of  especial  interest,  in  view  of  this  prevailing  method  of  price 
fixing,  to  note  whether  the  price  control  of  raw  materials  actually 
did  operate  to  stabilize  the  prices  of  their  primary  finished  products. 
Significant  bases  for  that  sort  of  inquiry  may  be  had  from  a  compari- 
son of  the  raw-material  prices  for  copper,  iron  and  steel,  lead,  wool, 
rubber,  hides  and  skins,  lumber,  and  crude  petroleum, 2  which  were 
controlled,  with  certain  of  their  manufactures  which  were  not. 
Such  a  comparison  here  has  been  facilitated  by  turning  the  actual 
prices  for  several  controlled  raw  materials,  and  their  corresponding 
uncontrolled  products,  into  relative  prices  by  making  their  respective 
prewar  actual  prices  (July  1,  1913,  to  June  30,  1914)  equal  100. 

The  fluctuations  of  copper  wire  followed  closely  those  of  the 
highly  controlled  electrolytic  copper.  The  prices  of  chains  and  saws 
did  not  rise  as  high  as  those  of  pig  iron,  but  those  of  chains  especially 
became  more  stable  after  control  of  pig  iron  began.  The  fluctuations 
of  lead  pipe  were  almost  identical  with  those  of  lead.  Woolen  yarn 
and  suiting  prices  followed  the  general  rise  in  wool  prices  but  seem 
to  have  been  stabilized  after  control  of  wool  set  in.  The  effect  of  a 
control  of  calfskins  upon  the  prices  of  shoes  can  scarcely  be  made 
out  from  a  comparison  of  their  respective  market  prices. 

*  The  most  notable  exceptions  to  this  common  practice  were  wheat  and  iron  and  steel,  the  products  of 
which  were  controlled  in  large  part  as  well  as  the  raw  materials. 

'  Crude  petroleum  was  stabilized  informally  by  the  industry  but  not  fixed  in  the  same  sense  that  the 
other  raw  materials  were. 


GOVERNMENT   CONTROL  OVER  PRICES. 


533 


S        8        8        S       "8        8 


r* 


i:»  in 


1          S 


J...-*™,,^ 


___ 


ains  and 
ember,  It 
o  June,  It 


534 


HISTORY    OF   PRICES    DURING   THE   WAR. 


§         § 


"•E^.4 
ft     ™ 


536 


HISTORY  OF  PRICES  DURING 'THE  WAR. 


RELATIVE  PRICES  OF  CONTROLLED  RAW  MATERIALS  AND  THEIR  UNCONTROLLED 

MANUFACTURES. 


Copper. 

Iron  and  steel. 

Lead. 

electro- 
lytic, 
New 
York 
(perlb.). 

Copper 
wire, 
base 
prices, 
New 
York 
(perlb.). 

Pig  iron, 
Marion- 
ing  or 
She- 
nango 
Valley 
furnace 
(pergr. 
ton). 

Chains, 
traces, 
wagon, 
western 
standard, 
straight, 
with 
ring, 
6*-S-2, 
New 
York 
(per  100 
pr.). 

Saws, 
crosscut, 
Diston 
No.  2, 
6-foot 
champion 
tooth, 
Phila. 
(per  saw). 

Lead, 

S& 

York 
(perlb.). 

Lead 
pipe, 
New 
York 
(per 
cwt.). 

Prewar  base  price 

$0.  1492 
100 

112 
102 
100 
104 
105 
100 

98 
105 
111 
111 

104 

97 

105 
103 
105 
104 

104 

97 
98 
96 
96 
95 
93 

90 

83 
81 
76 
79 

87 

97 
95 
85 
81 

89 

92 
98 
100 
115 
125 
132 

128 
115 
119 
120 
126 
136 

97 
124 
121 
127 
117 

$0.  1618 
100 

114 
108 
99 
99 
103 
103 

99 
99 
103 
110 
110 
99 

107 
102 
100 
106 

104 

99 
99 
97 
96 
96 
94 

90 
90 
83 
80 

77 
86 

98 
95 
88 
81 

91 

90 
97 
97 
103 
124 
124 

130 
124 
117 
117 
117 
130 

95 
117 
124 
121 

114 

$13.3183 
100 

123 
122 
121 
119 
114 
109 

108 
106 
105 
104 
98 
95 

122 
114 
106 
99 

110 

94 
99 
98 
98 
98 
98 

98 
98 
98 
96 
94 
94 

97 
98 
98 
95 

97 

94 
94 
94 
94 
94 
95 

96 
106 
111 
113 

118 
131 

94 
94 
104 
121 

103 

$32.00 
100 

100 
100 
100 
100 
100 
100 

100 

100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

'  100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
109 
109 

109 

109 
109 
97 
97 

97 

100 

106 
109 
97 

103 

$1.7820 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 

100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

$0.0418 
100 

103 
104 
104 
105 
104 
104 

104 
111 
112 

105 
103 
97 

103 
104 
109 
102 

105 

98 
97 
95 
91 
93 
93 

93 
93 
92 

84 
88 
?1 

97 
93 
92 
88 

92 

89 
92 
97 
101 
102 
142 

135 
111 
110 
110 
123 
128 

93 

115 
119 
121 

112 

$4.  8725 
100 

101 
101 
101 
103 
106 
106 

106 
108 
111 
108 
103 
97 

101 
105 
108 
103 

104 

96 
% 
96 
94 
93 
93 

93 
93 
93 
89 
88 
91 

96 
93 
93 

89 

93 

88 
88 
92 
96 
102 
131 

136 
124 
116 
111 
116 
123 

89 
110 
125 
116 

110 

1913—  Months- 
January 

February.         

March 

April. 

May 

June 

July 

August  

September 

October  

November  

December 

Quarters- 
First  

Second 

Third  

Fourth  

Year                           

1914—  Months- 
January 

February  

March 

April  

May 

June 

July 

August  

September.  .  . 

October  

November  

December 

Quarters  —  • 
First  

Second                       

Third 

Fourth  

Year 

1915—  Months- 
January  

February 

March  

April 

May 

June  

July  

August.                  .  .  . 

September 

October  r. 
Novembfir. 

Dppp.Tnher 

Quarters  — 
First 

Second 

Third  

Fourth  .... 

Year 

GOVERNMENT   CONTROL   OVER  PRICES. 


537 


RELATIVE  PRICES  OF  CONTROLLED  RAW  MATERIALS  AND  THEIR  UNCONTROLLED 

MANUFACTURES. 


Copper.                          Iron  and  steel. 

Lead. 

Copper, 
electro- 
lytic, 
New 
York 
(perlb.). 

Copper 
wire, 
base 
prices, 
New 
York 
(perlb.). 

Pig  iron, 
Mahon- 
ing  or 
She- 
nango 
Valley 
furnace 

(fornf 

Chains, 
traces, 
wagon, 
western 
standard, 
straight, 
with 
ring, 
64-8-2, 
New 
York 
(per  100 
pr.)- 

Saws, 
crosscut, 
Diston 
No.  2, 
6-foot 
champion 
tooth, 
Phila. 
(per  saw). 

Lead, 
pig, 
New 
York 
(perlb.). 

Lead 
Pipe, 
New 
York 
(per 
cwt.) 

Prewar  base  price 

$0.  1492 
100 

162 

184 
184 
196 
200 
184 

172 
183 
189 
192 
216 
227 

176 
193 
182 
212 

191 

203 
236 
240 
216 
217 
218 

194 
182 
i  171 
158 
158 
158 

226 
217 
182 
158 

1% 

158 
158 
158 
158 
158 
158 

174 
174 
174 
174 
174 
170 

158 
158 
174 
173 

165 

$0.  1618 
100 

145 
168 
181 
176 
195 
201 

201 

188 
190 
196 
196 
221 

165 

190 
193 
204 

188 

227 
227 
227 
227 
215 
202 

208 
196 
184 
184 
178 
171 

227 
215 
196 
178 

204 

167 
167 
167 
164 
164 
162 

175 
181 
181 
178 
178 
178 

167 

163 
179 

178 

172 

$13.3183 
100 

134 
133 
137 
136 
135 
135 

135 
135 
137 
149 
188 
225 

134 
135 
136 

188 

148 

225 
225 
242 
291 
312 
366 

394 
384 
1321 
248 
248 
248 

230 
322 
368 
248 

292 

248 
248 
248 
240 
240 
240 

240 
240 
240 
248 
248 
248 

248 
240 
240 

248 

244 

$32.00 
100 

100 
106 
119 
119 
134 
134 

134 

188 
188 
188 
188 
188 

108 
129 
170 

188 

149 

188 

188 
188 
188 
188 
188 

188 
188 
238 
238 
238 
238 

188 
188 
204 
238 

204 

238 

238 
238 
238 
238 
238 

238 
238 
238 
238 
238 
238 

238 
238 
238 
238 

238 

$1.7820 
100 

100 
100 
106 
106 
106 
106 

116 
116 
116 
116 
128 
128 

102 
109 
116 
124 

113 

128 
141 
141 
141 
155 
155 

155 
172 
172 
172 
172 
172 

137 
150 
166 
172 

156 

172 
172 
172 
172 
172 
202 

202 
202 
202 
202 
202 
202 

172 

182 
202 
202 

189 

$0.0418 
100 

142 

150 
171 

183 
178 
166 

152 
149 
163 
167 
168 
180 

154 
176 
155 
172 

164 

183 
207 
220 
222 
244 
267 

256 
253 
208 
161 
U50 
153 

203 
244 
239 
154 

210 

162 

167 
172 
162 
163 
182 

192 
193 
193 
193 
193 
157 

167 
169 
192 
181 

177 

$4.8725 
100 

133 
143 
162 
181 
174 
163 

156 
146 
151 
156 
158 
166 

146 
173 
151 
160 

157 

176 
191 
206 
211 
230 
257 

257 

246 
226 
181 
156 
156 

191 

232 
243 
164 

208 

161 

171 
176 
176 
176 
183 

191 
191 
191 
191 
191 
191 

169 
178 
191 
191 

182 

Made  equal  to 

1916—  Months- 
January  
February.                

March 

April  . 

May 

June 

July 

August 

September 

October.  . 

November 

December  

Quarters  — 
First 

Second 

Third 

Fourth  

Year     ... 

1917—  Months- 
January                 

February 

March  

April 

May 

June  

July 

August  

September  
October.  . 

November 

December  

Quarters  — 
First  

Second 

Third 

Fourth  

Year 

1918—  Months- 
January  .  . 

February. 

March  

April  .  . 

May 

Jim?  .. 

July. 

August 

September  
October.  . 

November. 

December  

Quarters- 
First. 

Second  .  .  . 

Third  

.fourth  .  . 

Year 

Government  control  of  price  began  during  month. 


538 


HISTORY  OF  PRICES   DURING  THE   WAR. 


RELATIVE  PRICES  OF  CONTROLLED  RAW  MATERIALS  AND  THEIR  UNCONTROLLED 

MANUFACTURES. 


Wool. 

Rubber. 

Hides  and  skins.             Petroleum. 

Wool, 
dom.. 
Ohio, 
Pa., 
W.  Va., 
un- 
washed, 
fine 
delaine, 
Boston, 

i{K 

Woolen 
yarn, 
weav- 
ing, 
12-16 
cut,  i 
blood 
grade 
Boston, 
(per 
lb.). 

Woolen 
cloths, 
suit- 
ings 
Middle- 
sex, 
15  oz. 
55-56 
n.,New 
York, 
(per 

yd.)- 

Rubber 
crude, 
Hevea, 
first 
latex 
crepe, 
New 
York, 
(per 
lb.). 

Rubber 
tires, 
pneu- 
matic, 
plain 
tread, 
30  by  3i 
in., 
Akron, 
Ohio, 
(per 
tire). 

Cattle 
hides, 
packer, 
heavy 
native 
steers, 
Chi- 
cago, 

ft£ 

Men's 
shoes 
vici 
calf, 
blu- 
cher, 
(per 
pair). 

Petro- 
leum, 
crude, 
Mid- 
conti- 
nent 
(Kans., 
Okla.) 
at 
wells, 

b(E 

Fuel 
oil, 
Tulsa, 
Okla., 
(per 
bbl.). 

Kero- 
sene, 
refined 
for 
export, 
New 
York, 
(per 
gal.). 

Prewar  base  price.. 
Made  equal  to... 

191  3-Month  s— 
January  
February.  .. 
March    . 

$0.2317 
100 

122 
119 
110 
110 

97 
97 

97 
97 
97 
97 
97 
96 

117 
101 
97 
97 
103 

96 
100 
100 
101 
106 
114 

119 
119 
114 
106 
110 
110 

99 
107 
117 
109 
108 

114 
132 
140 
127 
127 
123 

127 
132 
132 
182 
132 
136 

129 
126 
130 
133 
129 

$0.  5725 
100 

103 
103 
103 
103 
103 
103 

103 
103 
103 
103 
103 
103 

103 
103 
103 
103 
103 

103 
103 
107 
90 
90 
90 

90 
90 
90 
90 
90 
90 

104 
90 
90 
90 
93 

90 
90 
94 
94 

94 
94 

94 
111 
111 
111 
111 
111 

91 
94 
106 
111 

100 

$1.4813 
100 

106 
106 
106 
106 
lOf. 
106 

106 
106 
100 
100 
100 
100 

106 
106 
104 
100 
104 

100 
97 
97 
97 
97 
97 

97 
97 
100 
100 
100 
100 

98 
97 
98 
100 

98 

.    100 

100 
106 
106 
106 
106 

106 
106 
106 
106 
106 
109 

102 
106 
106 
107 
106 

$0.6123 
100 

175 
164 
149 
135 
132 
121 

114 
112 
96 
87 
93 
91 

163 
129 
107 
90 
122 

97 
102 
102 
112 
101 
93 

91 
139 
96 
95 
109 
130 

101 
102 
109 
111 
106 

119 
100 
105 
99 
98 
102 

105 
100 
97 
101 
122 
143 

108 
99 
101 
122 
108 

$13.  0900 
100 

115 
115 
115 
104 
104 
104 

104 
104 
104 
104 
104 
97 

115 
104 
104 
102 
106 

97 
97 
97 
97 
97 
97 

97 
97 
97 
97 
97 
97 

97 
97 

97 
97 
97 

97 
70 
70 
70 
70 
70 

70 
70 
70 
70 
70 
70 

79 

70 
70 
70 

72 

$0.  1861 
100 

103 
97 
97 
93 
89 
94 

95 
100 
101 
106 
106 
105 

99 
92 
99 
106 
99 

97 
98 
97 
97 
98 
99 

104 
110 
113 
114 
117 
121 

97 
98 
109 
117 
105 

124 
126 
124 
101 
111 
125 

138 
147 
142 
142 
141 
138 

125 
112 
143 
141 
130 

$3.  1375 
100 

99 
99 
99 
99 
99 
99 

99 
99 
99 
100 
100 
100 

99 
99 
99 
100 
99 

100 
100 
100 
100 
100 
100 

100 
100 
102 
102 
104 
104 

100 
100 
101 
103 
101 

104 
104 
104 
104 
104 
104 

104 
104 
104 
104 
104 
105 

104 
104 
104 
104 
104 

$0.9725 
100 

85 
90 
90 
90 
90 
90 

94 
102 
105 
105 
105 
105 

89 
90 
101 
105 
97 

105 
107 
107 
102 
76 
76 

76 
76 
66 
56 
56 
56 

107 
86 
74 
56 
81 

56 
56 
41 
41 
41 
41 

41 
51 
76 
82 
82 
102 

51 
41 

57 
89 
60 

$0.  7979 
100 

135 
135 
135 
135 
110 
110 

110 
94 
94 
100 
100 
100 

135 
118 
99 
100 
113 

100 
100 
100 
100 
100 
100 

72 
72 
72 
60 
60 
GO 

100 
100 
72 
60 
83 

56 

56 
44 
47 
47 
47 

47 
66 
66 
78 
97 
119 

52 
47 
60 
98 
64 

$0.0871 
100 

98 
98 
98 
98 
98 
100 

100 

100 
100 
100 
100 
100 

98 
98 
100 
100 
99 

100 
100 
100 
100 
100 
98 

98 
95 
95 
95 
92 
92 

100 
100 
96 
93 
97 

92 
89 
89 

87 
87 
87 

86 
86 
86 
86 
89 
94 

90 

87 
86 
90 

88 

April... 

May  .... 

June  

July  

August  

September.. 
October  
November.  . 
December.  .  . 

Quarters- 
First 

Second  
Third  
Fourth  

Year 

1914  Months  — 
January  
February  .  .  . 
March... 

April 

May  

June  

July 

August.  .  .  . 

September.. 
October  
November.  . 
December.  .  . 

Quarters- 
First        

Second. 

Third  

Fourth 

Year      

1915—  Months- 
January  
February  .  .  . 
March... 

April  

May. 

June  

July  
August  
Setember.... 
October  
November.  . 
December.  .  . 

Quarters- 
First  

Second  
Third  
Fourth  
Year  

GOVERNMENT   CONTROL  OVER  PRICES. 


539 


RELATIVE  PRICES  OF  CONTROLLED  RAW  MATERIALS  AND  THEIR  UNCONTROLLED 

MANUFACTURES. 


Wool. 

Rubber. 

Hides  and  skins. 

Petroleum. 

Wool, 
dom., 
Ohio, 
Pa., 
W.  Va., 
un- 
washed, 
fine 
delaine, 
Boston, 

ft 

Woolen 
yarn, 
weav- 
ing, 
12-16 
cut,  i 
blood 
grade 
Boston, 

ft 

Woolen 
cloths, 
suit- 
ings 
Middle- 
sex, 
15  oz. 
55-56 
n.,New 
York, 
(per 

yd.). 

Rubber 
crude, 
Ilevea, 
first 
latex 
crepe, 
New 
York, 
(per 
lb.). 

Rubber 
tires, 
pneu- 
matic, 
plain 
tread, 
oOby3£ 
in., 
Akron, 
Ohio, 
(per 
tire). 

Cattle 
hides, 
packer, 
neavy 
native 
steers, 
Chi- 
cago, 
(per 
lb.). 

Men's 
shoes 
vici 
calf, 
bluch- 
er, 
(per 
pair). 

Petro- 
leum, 
crude, 
Mid- 
conti- 
nent 
(Kans., 
Okla.) 
at 
wells, 
(per 
bbl.). 

Fuel 
oil, 
Tulsa, 
Okla., 

£$. 

Kero- 
sene, 
refined 
for 
export, 
New 
York, 
(per 
gal.). 

Prewar  base  price... 
Made  equal  to... 

1916—  Months- 
January  
February  .  .  . 
March  

$0.2317 
100 

140 
140 
145 
145 
145 
145 

149 
151 
155 
158 
170 
186 

142 
145 
152 
171 
152 

196 
211 
220 
231 
240 
304 

317 
322 
326 
324 
324 
324 

209 
258 
322 
324 
278 

324 
324 
324 
324 
!324 
319 

324 
324 
319 
319 
319 
293 

324 
322 
322 
311 
320 

JO.  5725 
100 

111 
111 
116 
116 
116 
116 

116 
116 
121 
121 
121 
129 

113 
116 
118 
123 
118 

135 
155 
172 
177 
181 
181 

190 
199 
199 
199 
225 
234 

154 
180 
196 
219 

187 

234 
242 
284 
301 
301 
301 

301 
301 
301 
301 
301 
301 

253 
301 
301 
301 
289 

$1.4813 
100 

109 
122 
129 
129 
129 
129 

132 
137 
141 
141 
147 
153 

120 
129 
137 
147 
133 

158 
173 
173 
182 
197 
213 

228 
243 
243 
243 
252 
252 

168 
197 
238 
249 
213 

255 
258 
258 
258 
276 
283 

283 
283 
283 
283 
283 
283 

257 
272 
283 
283 
274 

$0.6123 
100 

146 
140 
147 
136 
117 
105 

95 
95 
98 
102 
112 
129 

145 
119 
96 
114 
119 

127 
140 
139 
134 
135 
118 

111 
106 
109 
104 
98 
91 

135 
129 
109 
98 
118 

100 

86 
91 
98 
1103 
103 

103 
103 
103 
103 
100 
100 

92 
101 
103 
101 

99 

$13.0900 
100 

77 
77 
77 
77 
77 
77 

77 
77 
77 
77 
77 
77 

•  I 

77 
77 

77 
77 

77 

85 
85 
85 
96 
96 
96 

96 
96 
105 
105 
105 
105 

85 
96 
99 
105 
96 

105 

105 
105 
116 
116 
116 

116 
116 
116 
116 
116 
116 

105 
116 
116 
116 
113 

0.1861 
100 

124 
128 
122 
120 
113 
144 

145 
141 
140 
143 
169 
180 

125 
132 
142 
164 
141 

180 
171 
164 
164 
169 
177 

177 
172 
177 
181 
189 
188 

172 
170 
176 
186 
176 

176 
157 
141 
146 
*167 
177 

174 
161 
161 
161 
156 
156 

160 
164 
166 
158 
161 

3.  1375 
100 

107 
108 
110 
112 
115 
120 

120 
120 
120 
127 
127 
135 

108 
115 
120 
130 
118 

151 
151 
151 
151 
151 
151 

151 
151 
151 
151 
151 
151 

151 
151 
151 
151 
151 

151 
151 
159 
159 
159 
174 

180 
191 
205 
207 
207 
207 

154 
164 
192 
207 
179 

0.9725 
100 

125 
133 
151 
158 
158 
158 

155 
106 
92 
92 
93 
117 

137 
158 
119 
101 
129 

143 
173 
173 
173 
173 
173 

173 
173 
204 
204 
204 
204 

165 
173 
184 
204 
182 

204 
204 
204 
229 
229 
229 

229 
^229 
229 
229 
229 
229 

204 
229 
229 
229 

224 

0.  7979 
100 

128 
135 
144 
113 

88 
88 

81 
81 
81 
88 
141 
141 

136 
96 
81 
123 
109 

188 
188 
188 
188 
188 
172 

172 
172 
172 

226 
219 
219 

188 
183 
172 
221 
191 

219 
219 
219 
251 
251 
251 

251 

235 
235 
235 
235 
235 

219 
251 
240 
235 
236 

$0.  0871 
100 

99 
102 
102 
103 
103 
103 

103 

104 
102 
96 
96 
96 

101 

103 
103 
96 
101 

99 
105 
112 
118 
118 
118 

118 
119 
119 
119 
128 
139 

105 
118 
118 
129 
118 

144 
144 
146 
152 
153 
173 

174 
175 

178 
178 
194 
194 

144 
160 
175 
189 
167 

April  . 

Mav 

June  
July  

August  

September.. 
October  
November.. 
December.  .  . 

Quarters- 
First 

Second  
Third  
Fourth  
Year  

1917—  Months- 
January  
February  .  .  . 
March  
April  
Mky  
June 

July 

August  

September.. 
October  
November.  . 
December.  .  . 

Quarters- 
First  
Second  
Third  

Fourth  
Year  

1918—  Months- 
January  
February  .  .  . 
March  .  . 

April  
May... 

June 

July  

August  
September. 
October.... 
November  .  . 
December.  . 

Quarters- 
First 

Second  
Third  
Fourth  
Year  

1  Government  control  of  price  began  during  month. 


540 


HISTORY  OF  PRICES  DURING  THE  WAR. 


6.  A  COMPARISON  OF  THE  PRICES  OF  CONTROLLED 
MANUFACTURED  GOODS  WITH  THE  PRICES  OF  THEIR 
UNCONTROLLED  RAW-MATERIALS. 

It  was  exceptional  for  the  Government  to  initiate  control  within 
any  family  of  commodities  by  a  regulation  of  the  finished-product 
prices  only.  Since  raw-material  prices,  in  the  main,  fluctuate  more 
violently,  the  common  practice  was  to  begin  control  by  regulating 
the  raw  material.  The  outstanding  departure  from  this  procedure 
during  the  war  was  the  extension  of  price  control  over  cotton  goods, 
while  at  no  time  was  any  control  exercised  over  raw  cotton. 

There  are  given  here  relative  prices  for  cotton,  upland  middling, 
comparable  with  others  for  cotton  yarn,  carded,  white,  Northern, 
mule  spun,  22/1  cones.  The  actual  prewar  price  (July  1,  1913,  to 
June  30,  1914)  for  each  was  made  equal  to  100,  and  the  monthly 
actual  prices  from  January,  1913,  through  December,  1918,  turned 
into  relatives  upon  that  base. 

COTTON   YARN,  CARDED,   WHITE,  NORTHERN   MULE   SPUN,    22/1  CONES. 

[Controlled.] 
[Prewar  price  of  $0.2438  made  equal  to  100.]  • 


1913 

1914 

1915 

1916 

1917 

1918 

January                          ..                      .        

98 

98 

78 

105 

160 

238 

100 

98 

78 

105 

152 

249 

March                                                            

98 

98 

70 

104 

148 

257 

April 

100 

98 

78 

110 

168 

281 

Mav 

100 

94 

76 

112 

174 

289 

June 

98 

90 

76 

115 

180 

292 

July 

98 

94 

76 

116 

205 

i  288 

August 

98 

90 

79 

118 

205 

287 

September 

103 

82 

82 

125 

238 

285 

October 

109 

82 

90 

135 

197 

285 

November 

107 

72 

94 

149 

205 

273 

December     

107 

74 

98 

170 

217 

242 

First  quarter  

99 

98 

75 

104 

153 

248 

Second  quarter    . 

100 

94 

77 

112 

174 

287 

Third  quarter 

100 

89 

79 

120 

216 

287 

Fourth  quarter       .  . 

107 

76 

94 

151 

206 

267 

Year    ... 

102 

89 

81 

122 

187 

272 

Government  control  began. 


GOVERNMENT  CONTROL  OVER  PRICES. 


541 


COTTON,   UPLAND   MIDDLING. 

[Uncontrolled.] 
[Prewar  price  of  $0.1312  made  equal  to  100.] 


1913 

1914 

1915 

1916 

1917 

1918 

January' 

100 

97 

63 

95 

134 

247 

February  .        

98 

98 

65 

89 

124 

243 

March 

96 

101 

69 

91 

142 

258 

April 

94 

]00 

78 

92 

155 

242 

May 

91 

103 

75 

98 

158 

210 

June 

93 

103 

74 

99 

194 

232 

July  

94 

100 

70 

99 

199 

238 

August 

92 

91 

71 

111 

197 

263 

September 

103 

64 

84 

121 

173 

273 

October  

107 

53 

95 

138 

214 

248 

November 

104 

58 

91 

153 

228 

225 

December  

99 

58 

94 

139 

233 

232 

First  quarter 

98 

98 

66 

92 

134 

249 

Second  quarter  

93 

102 

76 

96 

168 

229 

Third  quarter 

96 

96 

75 

110 

190 

256 

103 

58 

93 

143 

224 

236 

Year... 

97 

92 

77 

110 

179 

242 

The  basis  for  a  wider  generalization,  perhaps,  may  be  had  from 
the  weighted  index  numbers  representing  57  series  of  controlled  cot- 
ton goods  and  24  series  of  uncontrolled  cotton  in  the  raw-materials 
stage,  which  also  follow  as  made  up  earlier  in  this  chapter. 

WEIGHTED    INDEX    NUMBERS    OF    CONTROLLED    COTTON    MANUFACTURES    AND 
UNCONTROLLED  COTTON  RAW  MATERIALS. 

[Prewar  average  aggregates  made  equal  to  100.] 


Month. 

1913 

1914 

1915 

1916 

1917 

1918 

CONTROLLED. 

January 

103 

100 

83 

106 

158 

225 

February  .  .  . 

103 

100 

84 

109 

157 

233 

March  

103 

99 

85 

110 

161 

246 

April.. 

102 

99 

87 

112 

169 

268 

May 

101 

99 

89 

114 

172 

270 

June  .  . 

100 

99 

89 

116 

184 

275 

July 

99 

99 

91 

119 

193 

i  279 

August  

100 

97 

92 

124 

194 

283 

September  .  . 

100 

94 

94 

128 

200 

269 

October  

102 

89 

99 

140 

206 

270 

November  

102 

85 

102 

153 

206 

270 

December. 

102 

84 

104 

160 

211 

267 

First  quarter.. 

103 

100 

84 

108 

159 

235 

Second  quarter 

101 

99 

89 

114 

175 

271 

Third  quarter  

100 

97 

93 

124 

196 

277 

Fourth  quarter 

102 

86 

102 

151 

208 

269 

Year 

101 

95 

92 

124 

184- 

263 

UNCONTROLLED. 

January 

100 

96 

54 

94 

141 

238 

February  .  .  , 

98 

98 

61 

95 

138 

244 

March     .  . 

97 

103 

61 

91 

131 

248 

April 

97 

98 

67 

95 

148 

261 

May.... 

95 

100 

75 

95 

156 

234 

June  . 

95 

102 

71 

100 

167 

225 

July  

95 

102 

71 

103 

203 

235 

August 

95 

102 

67 

104 

200 

229 

September 

97 

72 

70 

120 

192 

264 

October  

110 

64 

92 

128 

192 

261 

November  .... 

107 

52 

95 

148 

224 

240 

December. 

100 

56 

93 

161 

228 

227 

First  quarter.. 

98 

99 

59 

93 

136 

243 

Second  quarter 

96 

100 

71 

97 

157 

240 

Third  quarter  

96 

92 

69 

109 

198 

243 

Fourth  quarter  

105 

57 

93 

145 

215 

243 

Year  . 

99 

87 

73 

111 

176 

242 

Government  control  began. 


542  HISTORY  OF  PRICES  DURING  THE  WAR. 

7.  A  COMPARISON  OF  CONTROLLED  RAW-MATERIAL 
PRICES  WITH  THE  PRICES  OF  THEIR  CONTROLLED 
MANUFACTURED  PRODUCTS. 

A  study  of  the  relative  movements  of  important  basic  commodities 
which  were  regulated  both  in  the  raw-material  and  finished-product 
stages,  shows  the  results  of  the  more  rigid  controls.  The  important 
basic  commodities  so  controlled  were  wheat,  iron  and  steel,  hides 
and  skins,  corn,  sugar,  cattle,  and  coal.  There  have  been  made  ready 
for  comparison  the  following  combinations  of  raw  materials  and 
finished  products  of  which  all  series  were  controlled:  (1)  No.  2  red 
winter  wheat;  standard  patents  wheat  flour;  and  loaf  bread;  (2)  iron 
ore,  Mesabi,  non-Bessemer,  51 J  per  cent;  pig  iron,  basic,  Mahoning 
or  Shenango  Valley  Furnace;  steel  bars,  steel  sheets,  Bessemer;  and 
pipe,  cast  iron  6  inches;  (3)  cattle  hides,  heavy  native  steers;  and, 
cattle  hide  leather,  sole  leather,  hemlock  packer  slaughter,  No.  1; 
(4)  corn,  yellow  cash,  No.  3;  and  corn  meal,  white,  in  bulk;  (5)  raw 
cane  sugar,  96°  centrifugal,  duty  paid;  refined  cane  sugar,  fine  granu- 
lated; beet  sugar  granulated;  (6)  steers,  choice  to  prune,  heavy  beeves; 
and  steer  rounds,  No.  1;  (7)  bituminous  coal,  Pittsburgh  No.  8 
Ohio ;  and  Connellsville  coke. 

The  relative  prices  of  wheat  and  flour  held  close  together  save  during 
1918.  Bread  prices  did  not  rise  relatively  as  high  either  as  wheat 
or  flour  prices,  but  behaved  more  like  flour  prices  than  wheat  prices. 
Government  control  did  not  bring  the  pronounced  drop  hi  iron  ore 
prices  that  it  brought  in  pig  iron  prices,  since  iron  ore  prices  were 
fixed  near  their  market  level  and  pig  iron  prices  much  below.  The 
behavior  of  controlled  raw  and  refined  sugar  prices  was  nearly 
identical. 


GOVERNMENT   CONTROL  OVER  PRICES. 


543 


544 


HISTORY   OF   PRICES   DURING    THE    WAR. 


RELATIVE  PRICES  OT 

COAL  5  COKE. 


BTMONTM5 

JANUARY,  isra  -DCCTMBCR 1910 
AVCRAGC  QJOTCD  POICCS  JULY1913  TJUNC19I4-IO 


Relative  prices.— Iron:  Ore,  Pig,  and  Pipe.— By 
months,  January,  1913,  to  December,  1918.  (Aver- 
age quoted  prices,  July,  1913,  to  June,  1914=100.) 


Relative  prices.— Coal  and  Coke.— By  months, 
January,  1913,  to  December,  1918.  (Average 
quoted  prices,  July,  1913,  to  June,  1914=100.) 


GOVERNMENT   CONTROL   OVER  PRICES. 


545 


125547°— 20 35 


546 


HISTORY  OF   PRICES   DURING   THE   WAR. 


RELATIVE   PRICES  OF  CONTROLLED   RAW  MATERIALS  AND    THEIR   CONTROLLED 

MANUFACTURES. 


Wheat,  flour,  and  bread. 

Iron  ore,  pig  iron,  steel  bars,  sheet  steel, 
and  pipe. 

Cattle,  hides, 
and  sole  leather. 

Iron 

Wheat, 
No.  2, 
red, 
winter, 
Chicago 
(per 
bu.). 

Wheat 
flour, 
stand- 
ard 
pat- 
ents, 
Minne- 
apolis 
(per 
bbl.). 

Bread, 
loaf, 
New 
York 
(per 
16-oz.). 

ore, 
Mesabi, 
non- 
Bes- 
semer 
51i  per 
cent, 
lower 
lake 
ports 
(per 

Pig  iron, 
basic, 
Ma- 
honing 
or  She- 
nango 
Valley 
furnace 
(per 
gr.  ton). 

Sheet 
bars, 
Bes- 
semer 
Pitts- 
burgh 
(per 
gr.  ton). 

Steel, 
blue, 
an- 
nealed 
sheets, 
10- 
gauge, 
Pitts- 
burgh 
(per 
cwt.). 

Pipe, 
cast- 
iron, 
6-inch, 
New 
York 
(per 
sh.ton). 

Cattle 
hides, 
packer, 
heavy, 
native 
steers, 
Chicago 
(per 
16.). 

Sole 
leather, 
hem- 
lock, 
packer, 
slaugh- 
ter, 
No.  1, 
Chicago 

K 

gr.ton). 

Prewar  base  price 

$0.9321 

$4.5699 

$0.0412 

$3.  3083 

$13.3183 

$22.6750 

$1.4983 

$22.2258 

$0.  1861 

$0.3192 

Made  equal  to 

100 

100 

100 

100 

100 

100 

100 

100 

100 

100 

1913—  Months- 

January.. 

120 

98 

103 

103 

123 

128 

113 

112 

103 

94 

February 

116 

99 

103 

103 

122 

132 

117 

111 

97 

94 

March  

111 

96 

103 

103 

121 

132 

.  H7 

107 

97 

94 

April  
May  

114 
113 

101 
102 

103 
103 

103 
103 

119 
114 

125 
121 

117 
117 

106 
103 

93 
89 

94 
94 

June  

109 

106 

103 

103 

109 

119 

117 

103 

94 

91 

July  

95 

104 

103 

103 

108 

121 

117 

103 

95 

91 

August... 

93 

103 

103 

103 

106 

116 

113 

103 

100 

94 

Septem- 

ber   

99 

100 

103 

103 

105 

110 

109 

103 

101 

94 

October.. 

99 

98 

103 

103 

104 

101 

105 

103 

106 

100 

Novem- 

ber   

101 

98 

103 

103 

98 

95 

101 

103 

106 

100 

Decem- 

ber   

103 

98 

103 

103 

95 

93 

100 

100 

105 

103 

Quarters- 

First  

116 

98 

103 

103 

122 

131 

116 

110 

99 

94 

Second.  .  . 

112 

103 

103 

103 

114 

122 

117 

104 

92 

93 

Third.... 

96 

102 

103 

103 

106 

116 

113 

103 

99 

93 

Fourth... 

101 

98 

103 

103 

99 

96 

102 

102 

106 

101 

Year... 

106 

100 

103 

103 

110 

116 

112 

105 

99 

95 

1914—  Months- 

January.. 

104 

98 

105 

103 

94 

91 

93 

99 

97 

103 

February 

103 

100 

104 

103 

99 

97 

93 

99 

98 

103 

March.... 

102 

101 

104 

103 

98 

97 

93 

99 

97 

103 

April... 

101 

100 

104 

103 

98 

96 

93 

99 

97 

103 

May  

105 

101 

104 

86 

98 

93 

91 

94 

98 

102 

June  .  .  . 

96 

98 

109 

86 

98 

90 

90 

92 

99 

102 

July  

88 

101 

107 

86 

98 

88 

90 

92 

104 

100 

August... 

103 

121 

107 

86 

98 

93 

91 

92 

110 

100 

Septem- 

ber   

119 

130 

107 

86 

98 

96 

93 

92 

113 

101 

October.. 

119 

126 

109 

86 

96 

91 

95 

90 

114 

101 

Novem- 

ber   

123 

129 

109 

86 

94 

87 

93 

90 

117 

102 

Decem- 

ber   

129 

130 

109 

86 

94 

86 

89 

90 

121 

102 

Quarters- 

First  

103 

100 

104 

103 

97 

95 

93 

99 

97 

103 

Second.  .  . 

100 

100 

105 

92 

98 

93 

92 

95 

98 

102 

Third.... 

103 

117 

107 

86 

98 

92 

91 

92 

109 

100 

Fourth... 

124 

128 

109 

86 

95 

88 

93 

90 

117 

102 

Year. 

108 

112 

106 

92 

97 

92 

92 

94 

105 

102 

1315—  Months- 

January.. 

149 

150 

115 

86 

94 

87 

87 

90 

124 

105 

February 

173 

169 

102 

86 

94 

87 

87 

90 

126 

105 

March.... 

164 

164 

141 

86 

94 

87 

87 

90 

124 

105 

April  

171 

169 

113 

86 

94 

88 

89 

97 

101 

102 

May  

168 

172 

115 

86 

94 

88 

90 

99 

111 

100 

June  

132 

144 

117 

86 

95 

90 

89 

100 

125 

100 

July  

125 

154 

119 

85 

96 

97 

88 

101 

138 

103 

August... 

118 

138 

119 

85 

106 

106 

91 

105 

147 

108 

Septem- 

ber   

115 

117 

109 

85 

111 

112 

101 

110 

142 

110 

October.. 

121 

121 

109 

85 

113 

115 

107 

114 

142 

114 

Novem- 

ber   

121 

120 

109 

85 

118 

117 

127 

119 

141 

114 

Decem- 

ber   

132 

136 

115 

85 

131 

135 

151 

124 

138 

114 

Quarters- 

First  

162 

161 

119 

86 

94 

87 

87 

90 

125 

105 

Second.  .  . 

157 

162 

115 

86 

94 

89 

89 

99 

112 

101 

Third.... 

119 

136 

115 

85 

104 

105 

93 

105 

143 

107 

Fourth... 

125 

126 

111 

85 

121 

122 

128 

119 

141 

114 

Year.... 

141 

146 

115 

85            103 

101 

99 

103 

130 

107 

GOVERNMENT   CONTROL   OVER  PRICES. 


547 


RELATIVE  PRICES  OF  CONTROLLED  RAW  MATERIALS  AND  THEIR  CONTROLLED 

MANUFACTURES. 


Wheat,  flour,  and  bread. 

Iron  ore,  pig  iron,  steel  bars,  sheet  steel, 
and  pipe. 

Cattle,  hides, 
and  sole  leather. 

Iron 

Wheat 
No.  2, 
red, 
winter, 
Chicago 
(per 
bu.). 

Wheat 
flour, 
stand- 
ard 
pat- 
ents, 
Minne- 
apolis 
(per 

bbl  1 

Bread, 
loaf, 
New 
York 
(per 
16-oz.). 

ore, 
Mesabi, 
non- 
Bes- 
semer 
51J  per 
cent, 
lower 
lake 
ports 

Pig 
iron, 
basic, 
Ma- 
honing 
or  She- 
nango 
Valley 
furnace 
(per 

Sheet 
bars, 
Bes- 
semer 
Pitts- 
burgh 
(per 
gr.  ton). 

Steel, 
blue, 
an- 
nealed 
sheets, 
10- 
gauge, 
Pitts- 
burgh 
(per 

Pipe, 
cast- 
iron, 
6-inch, 
New 
York 
(per 
sh.ton). 

Cat.tle 
hides, 
packer, 
"heavy, 
native 
steers, 
Chicago 

Sole 
leather, 
hem- 
lock, 
packer, 
slaugh- 
ter, 
No.  1, 
Chicago 
(per 

DA.  )» 

gr.  ton). 

gr.  ton). 

cwt.). 

16.). 

Prewar  base  price 

$0.9321 

$4.5699 

$0.0412 

$3.  3083 

$13.3183 

$22.6750 

$1.4983 

$22.  2258 

$0.  1861 

$0.3192 

Made  equal  to 

100 

100 

100 

100 

100 

100 

100 

100 

100 

100 

1916—  Months- 

January.  . 

133 

145 

109 

107 

134 

143 

170 

130 

124 

111 

February 

135 

141 

109 

107 

133 

150 

177 

132 

128 

114 

March.... 

122 

129 

109 

107 

137 

181 

190 

134 

122 

114 

April  
Mav  - 

130 
124 

136 
135 

109 
109 

107 
107 

136 
135 

198 
190 

197 
200 

137 
137 

120 
133 

117 
122 

June  

112 

126 

111 

107 

135 

185 

200 

137 

144 

122 

July  

124 

133 

111 

107 

135 

187 

194 

137 

145 

122 

August... 

158 

166 

109 

107 

135 

203 

194 

137 

141 

122 

Septem- 

ber   

165 

184 

111 

107 

137 

198 

194 

139 

140 

122 

October.  . 

180 

203 

129 

107 

149 

212 

210 

142 

143 

127 

Novem- 

ber   

194 

215 

132 

107 

188 

238 

225 

160 

169 

174 

Decem- 

ber   

185 

190 

141 

153 

225 

259 

244 

184 

180 

188 

Quarters- 

First  

132 

138 

109 

107 

134 

158 

179 

132 

125 

113 

Second... 

122 

133 

109 

107 

135 

191 

199 

137 

132 

121 

Third.... 

149 

161 

110 

107 

136 

196 

194 

138 

142 

122 

Fourth... 

187 

203 

134 

122 

188 

236 

226 

162 

164 

163 

Year 

147 

159 

115 

111 

148 

195 

200 

142 

141 

130 

1917—  Months- 

January.  . 

204 

202 

139 

153 

225 

280 

284 

187 

180 

190 

February 

193 

198 

141 

153 

225 

287 

300 

187 

171 

189 

March.... 

212 

211 

152 

153 

242 

300 

314 

196 

164 

188 

April.... 

265 

254 

155 

153 

291 

331 

360 

233 

164 

188 

May  

319 

326 

179 

153 

312 

414 

447 

250 

169 

187 

June  

283 

304 

183 

153 

366 

463 

534 

273 

177 

185 

July  

250 

279 

183 

153 

394 

463 

551 

295 

177 

185 

August... 

1242 

286 

183 

153 

384 

414 

534 

295 

172 

172 

Septem- 

ber   

234 

1246 

183 

1153 

1321 

1353 

534 

295 

177 

166 

October.. 

233 

232 

183 

153 

248 

260 

501 

270 

181 

157 

Novem- 

ber   

233 

224 

183 

153 

248 

225 

1296 

254 

189 

160 

Decem- 

ber   

233 

222 

U55 

153 

248 

225 

284 

1254 

188 

160 

Quarters- 

First  

205 

203 

144 

153 

230 

289 

299 

189 

172 

189 

Second... 

291 

297 

172           153 

322 

403 

447 

252 

170 

187 

Third.... 

243 

271 

183 

153 

368 

410 

539 

295 

176 

174 

Fourth... 

233 

226 

173 

153 

248 

237 

360 

260 

186 

159 

Year... 

244 

249 

168 

153            292 

335 

410 

249 

176 

177 

1918—  Months- 

January. 

233 

221 

155 

153            248 

225 

284 

249 

176 

156 

February 

233 

225 

155 

153 

248 

225 

284 

249 

157 

152 

March.  .  . 

233 

221 

155 

153            248 

225 

284 

249 

141 

149 

April.... 

233 

219 

189 

153  !          240 

225 

284 

249 

146 

149 

May.... 

233 

208 

189 

153 

240 

225 

284 

256 

M67 

157 

June  

233 

215 

189 

153 

240 

225 

284 

276 

177 

165 

July.... 

241 

234 

189 

153            240 

225 

284 

278 

174 

169 

August.. 

240 

223 

189 

166  i          240 

225 

284 

278 

161 

M69 

Septem- 

ber   

240 

223 

185 

166 

240 

225 

284 

278 

161 

171 

October.. 

240 

223 

185 

174 

248 

225 

284 

305 

161 

172 

Novem- 

ber   

240 

223 

185 

174 

248 

225 

284 

305 

156 

174 

Decem- 

ber   

248 

223 

185 

174 

248 

225 

270 

305 

156 

175 

Quarters- 

First  

233 

222 

155 

153 

248 

225 

284 

249 

160 

149 

Second.  .  . 

233 

214 

189 

153 

240 

225 

284 

260 

164 

157 

Third  

240 

228 

187 

162 

240 

225 

284 

278 

166 

170 

Fourth... 

242 

223 

185 

174 

248 

225 

279 

305 

158 

174 

Year  

237 

222 

179 

160 

244 

225 

283 

273 

161 

163 

i  Government  control  of  price  began  during  month. 


548 


HISTORY   OF   PRICES   DURING   THE   WAR. 


RELATIVE   TRICES  OF  CONTROLLED    RAW  MATERIALS  AND    THEIR    CONTROLLED 

MANUFACTURES. 


Corn  and  corn- 
meal. 

Raw     sugar,     refined 
cane      sugar,      beet 
sugar,  granulated. 

Steers  and 
steer  rounds. 

Bituminous 
coal  and  coke. 

Corn, 

cash, 
No.  3 
yellow, 
Chi- 
cago 
(per 
bu.). 

Corn- 
meal, 
white, 
in 
bulk, 
Terre 
Haute 
(per 
cwt.). 

Sugar, 
raw. 
96° 
centri- 
fugal, 
New 
York 
(per 
l£). 

Sugar, 
refined, 
granu- 
lated, 
New 
York 

& 

Sugar, 
stand- 
ard, 
beet, 
granu- 
lated, 
Chi- 
cago 
(per 
l£). 

Steers, 
choice 
to 
prime, 
heavy 
beeves, 
Chi- 
cago 
(per 
cwt.). 

Steer 
rounds, 
No.  1, 
Chi- 
cago 

,(K 

Coal, 
bitu- 
minous, 
Pitts- 
burgh, 
No.  8, 
Ohio, 
Colum- 
bus, 
and 
De- 
troit 
(persh. 
ton). 

Coke, 
Con- 
nells- 
ville 
furnace, 
l.o.  b. 
ovens 
(per  sh. 
ton). 

Prewar  base  price  . 

$0.6859 
100 

70 
71 

74 
81 
83 
89 

90 
108 
110 
102 
106 
100 

72 
84 
104 
102 
90 

91 
90 
95 
99 
102 
104 

104 
118 
115 
107 
100 
94 

92 
102 
114 
101 
102 

104 
108 
105 
110 
111 
109 

114 
119 
112 
93 
93 
97 

106 
110 
114 

94 
107 

$1.6962 
100 

74 
75 
83 
94 
94 
97 

100 
107 
111 
102 
97 
98 

78 
95 
106 
99 
94 

95 
97 
96 
96 
97 
106 

105' 
118 
115 
104 
99 
97 

96 
100 
113 
101 

102 

95 
100 
98 
100 
101 
96 

103 

100 
93 
84 
82 
90 

98 
99 
99 
86 
95 

$0.0340 
100 

104 

102 
104 
100 
98 
98 

104 

109 
109 
102 
106 
99 

104 
99 
108 
103 
103 

99 
101 
88 
87 
94 
99 

97 
154 
170 
131 
115 
117 

96 
94 
141 
122 
113 

119 
139 
143 
139 
142 
144 

143 
140 
126 
122 
143 
146 

133 
142 
137 
136 
137 

$0.0413 
100 

109 

101 
101 
99 
99 
100 

108 
112 
110 

101 
102 
99 

104 
100 
110 
101 
104 

95 
95 
92 
90 
96 
101 

102 
157 
165 
144 
119 
117 

94 
96 
141 

127 
114 

118 
134 
138 
140 
142 
142 

141 
133 
123 
120 
138 
143 

130 
142 
132 
134 
135 

$0.  0426 
100 

109 
101 
101 
99 
99 
•      100 

108 
110 
109 
100 
101 
98 

103 
99 
109 
100 
103 

96 
96 
93 
91 
96 
101 

102 
156 
162 
143 
118 
117 

95 
96 
140 
125 
114 

118 
133 
138 
139 
140 
141 

140 
131 
122 
118 
129 
127 

130 
140 
131 
127 
132 

$9.  1022 
100 

99 
98 
98 
98 
95 
96 

99 
98 
100 
100 
98 
98 

98 
96 
99 
99 
98 

101 
101 
102 
102 
100 
101 

106 
110 
116 
115 
112 
107 

101 
101 
111 
111 

106 

101 
94 
95 
92 
95 
102 

100 
108 
107 
106 
109 
106 

97 
96 
108 
107 
102 

$0.  1295 
100 

97 
97 
95 
99 
103 
104 

108 
108 
104 
104 
99 
97 

96 
102 
107 
100 
101 

93 
90 
96 
93 
101 
108 

114 
117 
115 
107 
100 
98 

93 
101 
116 
102 
97 

90 
89 
89 
86 
96 
102 

104 
106 
105 
97 
98 
93 

89 
95 
105 
96 
% 

$1.0900 
100 

113 
98 
93 
97 
96 
94 

92 
99 
100 
106 
115 
100 

101 
96 
97 
107 
100 

98 
99 
99 
99 
97 
97 

95 
91 
91 
96 
102 
102 

99 
98 
92 
100 
97 

103 
105 
95 
94 

88 
90 

89 
94 
95 
98 
97 
100 

101 
91 

92 
99 
96 

$2.0625 
100 

178 
149 
124 
113 
104 
107 

115 
121 
119 
105 
93 
91 

150 
108 
118 
97 
118 

93 
93 
91 
93 
93 
91 

91 

87 
84 
81 
75 
79 

93 
93 

87 
78 
88 

79 
76 
76 
79 
79 
79 

85 
81 
81 
97 
115 
112 

77 
79 
82 
108 

87 

Made  equal  to 

1913—  Months— 

February 

March 

April 

Mav 

June  

July  

August 

September  

October 

November 

December  

Quarters- 
First      

Second 

Third 

Fourth  .  .  . 

Year 

1914—  Months- 
January  

February.  . 

March  

April 

May  

June  ... 

July  

August  

September  . 

October  

November  .  . 

December  

Quarters- 
First  

Second 

Third  

Fourth 

Year  

1915—  Months— 
January 

February 

March  

April 

May... 

June 

July 

August  

September 

October  

November..  . 

DfiOfvmhfir 

Quarters- 
First 

Second  

Third 

Fourth  .  .  . 

Year  

GOVERNMENT   CONTROL  OVER  PRICES. 


549 


RELATIVE  PRICES  OF  CONTROLLED    RAW  MATERIALS  AND    THEIR   CONTROLLED 

MANUFACTURES. 


Corn  and  corn- 
meal. 

Raw     sugar,     refined 
cane      sugar,      beet 
sugar,  granulated. 

Steers  and 
steer  rounds. 

Bituminous 
coal  and  coke. 

Corn, 
cash, 
No.  3, 
yellow, 
Chi- 
cago 
(per 
bu.). 

Corn- 
meal, 
white, 
in 
bulk, 
Terre 
Haute 
(per 
cwt.)- 

Sugar, 
raw, 
96° 
centri- 
fugal, 
New 
York 
(per 
IS.). 

Sugar, 
refined, 
granu- 
lated, 

New 
York 

& 

Sugar, 
stand- 
ard, 
beet, 
granu- 
lated, 
Chi- 
cagfr 

,<K 

Steers, 
choice 
to 
prime, 
heavy 
beeves, 
Chi- 
cago 
(per 
cwt.). 

Steer 
rounds, 
No.  1, 
Chi- 
cago 
(per 
l£). 

Coal, 
bitu- 
minous, 
Pitts- 
burgh, 
No.  8, 
Ohio, 
Colum- 
bus, 
and 
De- 
troit 
(persh. 
ton). 

Coke, 
Con- 
nells- 
ville 
furnace, 
f.o.b. 
ovens 
(per  sh. 
ton). 

Prewar  base  price    

$0.  6859 
100 

111 

108 
105 
111 
109 
106 

117 
125 
126 
141 
143 
133 

107 
109 
123 
139 
123 

144 

146 
164 
218 
240 
252 

301 
301 
301 
292 
1266 
244 

152 
235 
301 
265 
239 

240 
243 
228 
228 
216 
221 

234 

242 
226 
193 
189 
212 

236 
221 
234 
197 
222 

$1.6962 
100 

99 
101 
102 
109 
104 
106 

117 
123 
123 
131 
148 
141 

100 

107 
121 
140 
117 

147 
149 
164 
221 
243 
243 

288 
328 
313 
302 
1299 
287 

154 
237 
310 
296 
248 

285 
321 
304 
315 
270 
262 

284 
262 
235 
200 
178 
191 

303 
281 
261 
189 
259 

$0.  0340 
100 

137 
145 
164 
180 
189 
185 

186 
169 
159 
186 
186 
158 

148 
184 
1'72 
175 
170 

154 
149 
162 
184 
179 
177 

196 
216 
205 
1203 
203 
189 

156 
180 
205 
198 
185 

177 
177 
177 
177 
177 
177 

178 
178 
205 
214 
214 
214 

177 
177 
186 
214 
189 

$0.0413 
100 

139 
145 
160 
171 

181 
178 

182 
169 
154 
171 

178 
168 

148 
177 
169 
172 
167 

160 
166 
171 
197 
192 
183 

180 
198 
199 
1198 
198 
195 

166 
191 
193 
197 
187 

180 
177 
177 
177 
177 
177 

178 
178 
205 
214 
214 
214 

178 
177 
186 
214 
189 

$0.0426 
100 

127 
141 
157 
169 
178 
179 

178 
165 
149 
166 
174 
164 

144 
176 
164 
168 
163 

156 
162 
176 
187 
187 
176 

183 
187 
191 
1173 
173 
175 

165 
184 
186 
174 
176 

177 
178 
177 
177 
177 
178 

183 
183 
209 
217 
217 
217 

177 
177 
191 
217 
191 

$9.  1022 
100 

104 
102 
106 
107 
111 
121 

118 
115 
119 
120 
126 
126 

104 
113 
118 
124 
115 

126 
130 
137 
143 
145 
147 

149 
159 
179 
181 
171 
156 

131 
144 
162 
170 
152 

151 
151 
153 
177 
192 
196 

1199 
204 
211 
211 
214 
218 

151 
187 
205 
214 
190 

$0.  1295 
100 

89 
89 
97 
103 
106 
117 

116 
118 
119 
111 
106 
102 

91 
108 
117 
105 
106 

100 

106 
113 
126 
129 
133 

135 
134 
154 
154 
U46 
139 

107 
130 
142 
146 
131 

135 
132 
138 
146 

177 
198 

203 
209 
209 
203 
188 
178 

135 
175 
207 
189 
177 

$1.0900 
100 

96 
97 
95 
102 
102 
103 

103 
103 
123 
228 
425 
366 

96 
102 
109 
340 
162 

442 
438 
335 

248 
374 
392 

269 
1269 
184 
184 
224 
224 

405 

338 
240 
211 
299 

224 
224 
224 
224 
224 
215 

219 
219 
219 
219 
219 
219 

224 
222 
219 
219 
221 

$2.0625 
100 

139 
127 
145 
137 
115 
127 

127 
127 
133 
152 
279 
279 

137 
126 
129 
236 
157 

352 
364 
412 
352 
339 
461 

594 
485 
1570 
291 
291 
291 

376 
384 
549 
291 
400 

291 
291 
291 
291 
291 
291 

291 
291 
291 
291 
291 
291 

291 
291 
291 
291 
291 

Made  equal  to  

1916—  Months- 
January 

March                 

April 

May    . 

June     

July 

August  

September 

^October 

November  

December  

Quarters- 
First     

Second 

Third 

Fourth  

Year 

1917—  Months- 
January     

February 

March  

April  . 

May 

June  

July 

August 

September     

October 

December      

Quarters- 
First 

Second 

Third 

Fourth  .  .  . 

Year        ...  . 

1918-Months— 
January  

February.  .. 

March 

April... 

May  

June 

July 

August  .  . 

September  

October     

November 

December 

Quarters— 
First 

Second... 

Third 

Fourth 

Year 

1  Government  control  of  price  began  during  month' 


550  HISTORY  OF   PRICES   DURING  THE  WAR. 

8.  A  COMPARISON  OF  CONTROLLED  PRICES  AT  WHOLE- 
SALE WITH  CORRESPONDING  CONTROLLED  PRICES  AT 
RETAIL. 

The  great  bulk  of  regulation  over  prices  administered  by  the  Fed- 
eral Government  during  the  war  pertained  to  producer  or  wholesale 
prices.  There  was  no  real  attempt,  save  in  food  and  fuel,  to  control 
prices  at  retail.  The  task  of  controlling  retail  prices,  infinitely  more 
difficult  than  that  of  controlling  wholesale  prices,  was  undertaken  in 
a  comprehensive  manner  by  the  Food  Administration  after  its  whole- 
sale control  was  well  underway.  Since  the  consumer  was  more 
directly  concerned  with  the  effects  of  retail  control,  there  attaches 
peculiar  interest  to  the  relative  prices  at  which  foods  at  wholesale 
and  those  at  retail  were  held  after  control  began  late  in  1917.  There 
follows  a  tabulation  of  relative  prices  for  25  leading  food  commodities 
at  wholesale  and  at  retail,  which  were  made  strictly  comparable  by 
letting  their  respective  prewar  basis  (average  actual  price  for  1913) 
equal  100.1 

1  These  relative  prices  were  made  from  representative  actual  retail  prices,  quoted  at  various  cities  through- 
out the  United  States,  as  compiled  by  the  Bureau  of  Labor  Statistics. 


GOVERNMENT   CONTROL  OVER  PRICES. 


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552 


HISTORY   OF   PRICES  DURING  THE   WAR. 

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GOVERNMENT   CONTROL  OVER  PRICES.  553 

9.  A  COMPARISON  OF  WAR  PRICES  IN  THE  UNITED  STATES, 
ENGLAND,  FRANCE,  AND  CANADA. 

The  world  price  revolution  which  followed  close  upon  the  heels  of 
the  war  in  Europe,  and  the  widespread  control  over  prices  which  the 
Governments  exercised,  make  the  price  student  eager  to  measure  the 
relative  successes  of  our  Government  and  foreign  Governments  in 
stabilizing  prices.  There  are  many  reasons  why  caution  must  be 
exercised  while  measuring  the  effects  of  regulation  upon  domestic  and 
European  prices.  The  paramount  difficulty,  which  can  never  be 
entirely  overcome  or  discounted,  is  that  Europe  went  to  war  and 
began  her  control  nearly  three  years  ahead  of  the  United  States. 
The  United  States,  which  did  not  set  maximum  prices  until  the  price 
level  had  reached  a  high  point,  had  by  far  the  easier  control  problem. 
There  are,  despite  these  difficulties,  certain  devices  which  help  to 
measure  the  relative  rises  of  prices  here  and  abroad  during  their 
various  control  periods. 

It  is  not  permissible  statistically  to  judge  the  relative  degrees  of 
stabilization  that  were  brought  to  various  price  levels,  except  by  a 
comparison  of  identical  prices.  The  difficulty  of  finding  foreign 
quotations,  not  to  mention  that  of  weighting  the  few  available,  makes 
expedient  the  rejection  of  the  Price  Section  index  number  for  this 
country  and  the  making  anew  of  one  to  match  each  foreign  index 
number  constructed.  There  were  compiled,  as  the  basis  for  making 
American  index  numbers,  150  commodity  prices  for  England;  44  for 
France;  36  for  Italy;  and  270  for  Canada.  These  actual  prices,  after 
reducing  them  to  their  smallest  monetary  unit  but  without  assigning 
weights,  were  turned  into  relative  prices  by  letting  the  average  pre- 
war (July  1,  1913,  to  June  30,  1914)  actual  price  of  each  series  equal 
100.  They  were  then  matched  by  a  like  number  of  corresponding 
price  series  for  the  United  States  which  also  were  turned  into  relatives. 
The  resulting  set  of  index  numbers  for  each  country,  made  from  the 
medians  of  relative  prices,  is  strictly  comparable  with  the  corre- 
sponding set  of  index  numbers  made  from  corresponding  prices  in 
the  United  States.  The  comparison  of  prices  in  England  and  the 
United  States,  made  more  in  detail  by  the  separation  of  food,  iron  and 
steel,  clothing,  and  chemical  prices  from  the  two  index  numbers,  is 
much  the  most  significant  of  these  studies: 


554 


HISTORY  OF   PRICES  DURING  THE   WAR. 


LISTING  IN  DETAIL  OF  EACH  SERIES  OF  FOREIGN  PRICES  FROM  WHICH  VARIOUS 
FOREIGN  INDEX  NUMBERS  WERE  MADE,  AND  FOR  WHICH  IDENTICAL  SERIES  OF 
DOMESTIC  PRICES  WERE  CHOSEN  TO  MAKE  STRICTLY  COMPARABLE  INDEX  NUMBERS 
FOR  THE  UNITED  STATES. 

UNITED  KINGDOM. 
[150  commodities.] 


Acetone. 

Acid,  muriatic  Tw. 

Acid,  acetic,  60  per  cent. 

Acid,  carbolic,  crystals,  34/35°. 

Acid,  nitric,  80°. 

Acid,  oxalic. 

Acid,  sulphuric,  168°. 

Acid,  tartaric,  powder. 

Alumina,  sulphate  of,  pure. 

Ammonia,  anhydrous. 

Ammonia,  sulphate  of. 

Aniline  oil,  pure. 

Arsenic,  white,  powdered. 

Bacon,  Canadian,  green  sides. 

Barley,  British  Gazette  price. 

Barium,  sulphate  of,  native  levigated. 

Beans,  English. 

Beef,  British. 

Benzol,  50/90  per  cent. 

Bleaching  powder. 

Brass  sheets. 

Burlap,  bags,  Chilean  oats  and  barley. 

Butter,  British,  first  quality. 

Cabbages. 

Calcium,  chloride  of. 

Casein. 

Cattle,  store,  shorthorns,  yearling. 

Cement,  Portland. 

Cheese,  Canadian. 

Coal,  anthracite,  best  malting. 

Coal,  Lancashire,  best  house. 

Coal,  steam,  best  Lancashire. 

Coal,  steam,  smalls,  best  Cardiff. 

Cocoa,  Grenada,  good  to  fine. 

Coffee,  Costa  Rica,  good  to  fine. 

Coke,  furnace,  best,  South  Wales. 

Copper,  English  selected. 

Copper,  standard. 

Copper  sheets,  sheathing  and  rods. 

Copper,  sulphate  of. 

Copper  wire. 

Copperas,  green,  in  bulk. 

Cotton,  American,  middling. 

Cotton,  cloth,  32-inch  printed,  116  yards, 

16  by  16,  32/50. 
Cotton  cloth,  32-inch  shirtings,  76  yards, 

19  by  19,  32's/40's. 


Cotton  yarn,  60's  twist,  Egyptian. 

Cotton  yarn,  40 's  weft. 

Creosote,  ordinary  good  liquid. 

Ducks,  London,  live. 

Eggs,  British,  first  quality. 

Flour,  wheat,  Town  Household. 

Fowls,  live. 

Fustic,  Jamaica. 

Gambier. 

Glue,  best  bone  (bone  liquid  glue). 

Glycerin,  industrial,  S.  C.,  1,260°. 

Hams,  American,  green,  long  cut. 

Hay,  best. 

Hemp,  manila. 

Hides,  cattle,  50/59. 

Hides,  cattle,  60/69. 

Hides,  cattle,  70/79. 

Hides,  cattle,  dry  and  dry  salted,  Central 
American. 

Hides,  cattle,  salted,  Australian. 

Hogs,  porkers. 

Indigo,  Bengal,  good  red  violet. 

Iron,  bars,  unmarked,  South  Stafford- 
shire. 

Iron  bars,  Welsh  ports. 

Iron  hoops,  ordinary  bedstead. 

Iron,  pig,  Middlesborough,  good  marked 
bars. 

Lamb,  Argentine. 

Lard,  American,  boxes. 

Lead,  acetate  of,  white. 

Lead,  carbonate  of  (white  lead),  pure. 

Lead,  nitrate  of. 

Lead,  red. 

Lead,  soft,  foreign. 

Lime. 

Lime,  acetate  of,  gray,  80  per  cent. 

Logwood,  Campeche. 

Lumber,  Dantzig  and  Memel. 

Magnesium,  sulphate  of. 

Mutton,  Argentine,  frozen. 

Mutton,  English. 

Oatmeal,  Aberdeen. 

Oats,  British  Gazette  price. 

Oil,  coconut,  crude. 

Oil,  cottonseed. 

Oil,  linseed. 


GOVERNMENT   CONTROL  OVER  PRICES. 


555 


Onions,  Valencia. 

Petroleum,  American. 

Pork,  British. 

Potassium,  bichromate  of. 

Potassium,  chlorate  of. 

Potassium,  muriate  of. 

Potassium,  nitrate  of. 

Potassium,  permanganate  of. 

Potassium,  sulphate  of,  90  per  cent. 

Potatoes,  English. 

Rice,  Bassein. 

Rubber,  Para,  fine  hard. 

Sheep,  fat  stock,  Welsh. 

Shellac,  T.  N.  orange,  fair. 

Silk,  Cossimbuzzar,  raw. 

Silk,  Italian. 

Silk,  Japan. 

Silver,  metal. 

Skins,  calf,  12/16. 

Skins,  calf,  light. 

Skins,  kip,  first  quality. 

Soda,  ash,  carbonated,  58  per  cent  (am- 
monia alkali) . 

Sodium,  bicarbonate  of,  crystals. 

Sodium,  borate  of  (borax),  crystals. 

Sodium,  hydrate  of  (75  per  cent  0.  soda). 

Sodium,  nitrate  of,  95  per  cent. 

Sodium,  silicate  of  (liquid  100°  Tw.). 

Sodium,  sulphate  of  (salt  cake). 

Sodium,  sulphide  of,  cone. 

Steel,  rails,  heavy. 

Steel,  sheets,  doubles. 

Steel,  sheets,  galvanized,  flat,  annealed, 
18  g.,  South  Wales. 


Steel,    strip,    mild    Siemens,    for    nails, 

hinges,  etc. 

Sugar,  cane  (West  Indian  sirups). 
Sulphur,  brimstone,  best  thirds. 
Tallow,  imported. 
Tea,  Congow. 
Tin,  English  ingots. 
Tin  plates,  Bessemer  steel  coke  or  Sie-' 

mens  (coke  finish). 
Tobacco,  Virginia  leaf  (in  bond). 
Turpentine,  American. 
Veal,  British,  first  quality. 
Wheat,  British  Gazette  price. 
Wood  pulp,  chemical,  soda  unbleached. 
Wood  pulp,  chemical,  sulphite,  bleached, 

good  quality. 
Wood    pulp,    mechanical,    50    per    cent 

moist,  unwrapped. 
Wool,  Cape  firsts. 
Wool,  good  Victoria. 
Wool,  domestic,  Lincoln  hogs. 
Wool,  domestic,  Scotch  blackface. 
Wool,  Shropshire  hogs. 
Wool,  tops,  colonial,  40 's  prepared. 
Wool,  tops,  colonial,  50's. 
Wool,  tops,  colonial,  60's,  super. 
Wool,  tops,  colonial,  70's. 
Wool,  yarns,  2/48  white  botany. 
Wool,  yarns,  3/12  white  scoured  hosiery 

(40's). 

Wool,  yarns,  2/32's,  worsted  crossbred. 
Wool,  yarns,  2/40's,  worsted  crossbred. 
Zinc,  pig  (spelter),  ordinary  foreign. 
Zinc,  sulphate  of. 


PRANCE. 


[44  commodities.] 


Acid,  hydrochloric. 

Acid,  sulphuric. 

Ammonia,  sulphate  of. 

Barley. 

Beef,  first  to  third  quality,  dressed. 

Butter,  from  all  sources. 

Cocoa,  Haiti. 

Coffee,  Santos. 

Copper,  ingots,  for  manufacturing  of  brass. 

Cotton,  Louisiana  ordinary. 

Flour,  Corbell  brand. 

Gasoline,  mineral. 

Glycerin,  lixivation. 

Glycerin,  saponincation. 

Hay. 

Lard,  American. 


Lead,  various  origins. 
Lime,  chloride  of. 

Mutton,  first  to  third  quality,  dressed. 
Oats,  black  (or  gray). 
Oil,  colza. 
Oil,  linseed. 
;  Oil,  palm. 
Petroleum,  refined. 
Pork,  first  to  third  quality,  dressed. 
Potatoes. 

Rice,  Saigon,  importation. 
Rubber,  fine,  Para. 
Rye. 

Silk,  raw,  Cevennes,  second  class,  12/16. 
Soap,  white,  pure,  olive  oil. 
Soda,  carbonate  of. 


556  HISTORY   OF   PRICES  DURING  THE   WAR. 


Soda,  caustic,  salts  of  (for  manufacturing). 

Soda,  nitrate  of. 

Straw. 

Sugar,  refined,  beet,  first  quality.. 

Superphosphate . 

Tallow,  native,  fresh  melted. 


Tin,  English,  from  Cornwall. 
Tin,  Straits  Settlements. 
Wheat,  national. 
Wine,  Rousillon,  10-11°. 
Wool,  Buenos  Aires. 
Zinc,  of  Silesia. 


CANADA. 
[270  commodities.] 

A  listing  of  the  specific  series  which  went  into  the  making  of  this  index  number, 
which  is  of  less  importance  for  the  purposes  of  this  inquiry  than  those  previous,  may 
be  had  by  reference  to  the  index  number  made  by  the  Canadian  Department  of  Labor. 

The  medians  of  relative  prices  of  150  identical  commodities  in 
England  and  the  United  States,  show  that  English  prices  rose  earlier 
and  higher  than  American  prices.  While  England  had  a  more 
difficult  control  problem,  because  she  started  regulation  before  prices 
had  adjusted  themselves  to  the  war  pressure,  the  general  rise  of 
English  prices  was  not  stopped  by  regulatory  measures.  The  level 
of  American  prices,  after  this  country  began  control,  shows  a  marked 
stability  by  comparison  with  the  continued  British  rises.  Food 
prices  were  held  relatively  much  lower  in  the  United  States  than  in 
England,  as  were  chemical  prices.  The  prices  of  iron  and  steel,  on 
the  other  hand,  were  stabilized  on  a  somewhat  lower  level  relatively 
in  England  than  in  the  United  States.  The  prices  of  clothing  rose 
and  fell  relatively  about  the  same  in  England  and  the  United  States 
though  the  rise  and  fall  were  both  slightly  earlier  in  this  country 
than  in  England. 

The  medians  of  relative  prices  of  44  identical  commodities  in 
France  and  the  United  States,  show  that  French  prices  rose  earlier 
and  much  higher  than  American  prices.  The  American  prices  of 
these  selected  commodities,  unlike  those  of  the  corresponding  prices 
for  France,  turned  downward  early  in  1918.  The  behavior  of  Cana- 
dian and  American  prices  was  curiously  similar,  though  Canadian 
prices  rose  slightly  higher. 


GOVERNMENT   CONTROL   OVER   PRICES. 


557 


mm 


§  .8 


§  §         § 


8          8  ,' 


. 

5  IS, 


!_ I 


§      § 


I       .8      1 


I       § 


-I    11^ 


ill 
11* 

8§g> 


558 


HISTORY   OF   PRICES   DURING   THE   WAR. 


GOVERNMENT  ^CONTROL   OVER  PRICES. 


559 


!#*'i8g 

^9       ZQ^ 

iSftS  6ftf 


i-»  p, 


.„  >»&> 

opq  g 
S«3^ 

Srt^d 

sll! 


560 


HISTORY  OF  PRICES  DURING  THE  WAR. 


A  COMPARISON  OF  INDEX  NUMBERS  OF  WHOLESALE  PRICES  IN  THE  UNITED  STATES, 
ENGLAND,  FRANCE,  AND  CANADA. 

[Medians  of  relative  prices  of  identical  lists  of  commodities  figured  by  making  the  price  from  July  1,  1913, 

to  June  30, 1914=100.] 


Date. 

Class  and  series. 

All  commodities. 
(150) 

Food. 

(34) 

Iron  and  steel. 
(9) 

Clothing. 

(29) 

Chemicals. 

(55) 

Eng- 
land. 

United 
States. 

Eng- 
land. 

United 
States. 

Eng- 
land. 

United 

States. 

Eng- 
land. 

United 
States. 

Eng- 
land. 

United 

States. 

1913—  Months- 
January  
February..  . 
March  
April... 

101 
102 
101 
101 
101 
101 

101 
100 
101 
101 
100 
100 

101 
101 
101 
100 

101 

100 
100 
100 
99 
99 
99 

98 
100 
100 
102 
102 
105 

100 
99 
99 
103 

100 

107 
111 
117 
119 
124 
131 

130 
133 
137 
137 
137 
147 

112 
125 
133 
140 

128 

101 
101 
101 
101 
100 
100 

100 
101 
101 
101 
100 
100 

101 
100 
101 
100 

101 

99 
99 
100 
99 
99 
99 

99 
100 
100 
100 
100 
100 

99 
99 
100 
100 

100 

100 
100 
101 
102 
102 
105 

111 
112 
110 
113 
116 
123 

100 
103 
111 
117 

108 

102 
103 
105 
105 
103 
103 

102 

102 
102 
101 
100 

100 

103 
104 
102 
100 

102 

100 

100 
100 
98 
97 
98 

96 
102 
105 
103 
104 
105 

100 
9« 
101 
104 

101 

110 
113 
110 
126 
123 
125 

120 
123 
127 
128 
130 
133 

114 
125 
123 
130 

123 

94 
99 
99 
100 
98 
97 

100 
99 
101 
101 
100 
99 

97 
98 
100 
100 

99 

100 

100 
100 
98 
99 
98 

98 
102 
103 
102 
103 
101 

100 
98 
101 
102 

100 

100 
103 
104 
100 
99 
97 

99 
101 
97 
100 
99 
102 

102 
99 
99 
100 

100 

113 
113 
112 
112 
112 
111 

109 

105 
106 
101 
99 

98 

113 
112 

107 
99 

108 

98 
98 
96 
98 
98 
96 

97 
97 
103 
104 
104 
104 

97 
97 
99 
104 

99 

104 
112 
117 
127 
127 
140 

143 
145 
141 
140 
152 
180 

111 
131 
143 

157 

136 

114 
115 
115 
113 
111 
111 

111 

109 
103 
103 
100 
97 

115 
112 
108 
100 

109 

95 
98 
98 
96 
93 
92 

91 
95 
95 
93 
93 
90 

97 
94 
94 
92 

94 

89 
90 
91 
91 
91 
92 

93 
99 
103 
110 
120 
129 

90 
91 

98 
120 

100 

99 
99 
99 
99 
100 
101 

101 

100 
100 
101 
100 

98 

99 
100 
100 
100 

100 

98 
98 
101 
101 
101 
102 

100 
99 
98 
101 
96 
92 

99 
101 
99 
96 

99 

90 
99 
103 
106 
106 
108 

116 
117 
116 
117 
114 
114 

97 
107 
116 
115 

109 

105 
105 
105 
102 
99 
99 

98 
98 
100 
103 
102 
99 

105 
100 
99 
101 

101 

97 
99 
101 
100 
99 
100 

100 
100 
100 
97 
100 
100 

99 
100 
100 
99 

99 

103 
107 
112 
104 
108 
110 

115 
116 
117 
118 
119 
120 

107 
107 
'  116 
119 

112 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
109 
119 
114 
117 

100 
100 
103 
117 

105 

121 
123 
126 
130 
137 
145 

150 
155 
158 
168 
187 
201 

123 
137 
154 
185 

150 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 

100 

100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
102 
102 

100 
100 
100 
101 

100 

102 
103 
103 

111 

112 
113 

127 
131 
142 
147 
160 
167 

103 
112 
133 
153 

127 

May 

June 

July.... 

August 

September  .  . 
October  
November.  . 
December.  .  . 

Quarters- 
First  

Second. 

Third  

Fourth..  . 

Year.... 

1914—  Months- 
January  
February  
March  
April  

June 

July 

August  
September. 
October  
November. 
December.  . 

Quarters  — 
First 

Second 

Third 

Fourth  
Year 

1915—  Months- 
January  
February.  .. 
March  
April.  .  . 

May 

June.  . 

JuJy.... 

August  
September.. 
October  
November.  . 
December.  .  . 

Quarters  — 
First  

Second  
Third  
'  Fourth  

Year  

GOVERNMENT    CONTROL   OVER  PRICES. 


561 


A  COMPARISON  OF  INDEX  NUMBERS  OF  WHOLESALE  PRICES  IN  THE  UNITED  STATES, 
ENGLAND,  FRANCE,  AND  CANADA— Continued. 

[Medians  of  relative  prices  of  identical  lists  of  commodities  figured  by  making  the  price  from  July  1,  1913, 

to  June  30,  1914=100.] 


Date. 

Class  and  series. 

All  commodities. 
(150) 

Food. 

(34) 

Iron  and  steel. 
(9) 

Clothing. 

(29) 

Chemicals. 

(55) 

Eng- 
land. 

United 
States. 

Eng- 
land. 

United 

States. 

Eng- 
land. 

United 
States 

Eng-     United 
land.     States. 

Eng- 
land. 

United 

States. 

1916—  Months- 
January  
February..  . 
March  
April  

151 
158 
164 
166 
171 
172 

167 
167 
173 
177 
186 
196 

158 
170 
169 
186 

171 

198 
198 
206 
206 
214 
216 

214 
211 
215 
222 
226 
237 

201 
212 
213 
228 

214 

238 
239 
239 
241 
241 
241 

242 
239 
245 
249 
245 
245 

239 
241 
242 
246 

242 

128 
132 
139 
145 
146 
145 

144 
149 
148 
164 
164 
176 

133 
145 
147 
165 

148 

181 
187 
195 
202 
206 
206 

205 
206 
206 
204 
207 
209 

188 
205 
206 
207 

202 

209 
211 

207 
213 
208 
199 

202 
209 
209 
210 
210 
207 

209 
207 
207 
209 

208 

139 
137 
141 
150 
155 
153 

148 
151 
1.55 
157 
158 
166 

139 

153 
151 
160 

151 

172 

186 
188 
193 
203 
202 

198 
197 
197 
194 
201 
199 

182 
199 
197 
198 

194 

204 
204 
203 
220 
216 
225 

226 
232 
234 
234 
227 
231 

204 
220 
231 
231 

221 

108 
113 
111 
115 
114 
113 

115 
117 
123 
124 
129 
127 

111 
114 
118 
127 

117 

137 
146 
149 
165 
178 
169 

157 
155 
164 
170 
173 
187 

144 
171 
159 
177 

163 

182 
195 
192 
199 
190 
186 

187 
200 
201 
206 
209 
208 

190 
192 
196 
208 

196 

189 
198 
210 
219 
231 
225 

225 
225 
225 
225 
227 
234 

199 
225 
225 
229 

219 

240 
240 
210 
206 
218 
241 

241 
231 
231 
222 
222 
222 

230 
222 
234 
222 

227 

222 
222 
222 
222 
222 
222 

222 
220 
218 
216 
216 
216 

222 
222 
220 
216 

220 

147 
158 
165 
167 
167 
167 

171 
171 
171 
171 
188 
218 

157 
167 
171 
192 

172 

222 
226 
243 
261 
289 
325 

357 
357 
349 
289 
250 
250 

230 
292 
3.54 
263 

285 

250 

250 
250 
250 
250 
250 

251 
251 
251 
251 
251 
251 

250 
250 
251 
251 

251 

124 
126 
127 
128 
130 
139 

139 
138 
148 
153 
161 
167 

126 
132 
142 
160 

140 

168 
168 
170 
175 
184 
190 

196 
200 
201 
206 
212 
230 

169 
183 
199 
213 

191 

236 
242 
245 
249 
243 
•    243 

258 
223 
223 
230 
205 
205 

241 
245 
235 
213 

234 

123 
126 
132 
134 
136 
141 

142 
142 
143 
147 
160 
175 

127 
137 
142 
161* 

142 

179 
185 
189 
187 
194 
210 

216 
212 
209 
218 
240 
246 

184 
197 
212 
235 

207 

247 
250 
251 
239 
212 
232 

225 
203 
203 
203 
190 
185 

249 
228 
210 
193 

220 

204 
207 
226 
230 
235 
255 

255 
261 
261 
255 
264 
255 

212 
240 
259 
258 

242 

255 
262 
286 
286 
293 
293 

289 

288 
289 
296 
302 
302 

268 
291 
289 
300 

287 

202 
314 
312 
312 
326 
326 

326 
307 
321 
336 
300 
283 

309 
321 
318 
306 

314 

183 
208 
208 
250 
250 
250 

233 
216 
200 
190 
193 
192 

200 
250 
216 
192 

214 

192 
192 
205 
235 
240 
235 

229 
239 
239 
247 
244 
237 

196 
237. 
236 
243 

228 

240 
240 
240 
236 
247 
247 

213 
228 
230 
250 
251 
233 

240 

243 
224 
245 

238 

May  
June  

July 

August  
September  .  . 
October  
November.  . 
December.  .  . 

Quarters- 
First 

Second  
Third  

Fourth  
Year  

1917—  Months- 
January  
February..  . 
March  

April... 

May  
June  

July 

August:.. 

September  .  . 
October  
November.  . 
December.  .  . 

Quarters  — 
First 

Second  

Third 

Fourth  
Year 

1918—  Months- 
January  
February..  . 
March  
April  
May  
June  

July 

August  
September  .  . 
October  
November.  . 
December.  .  . 

Quarters  — 
First  
Second  
Third  
Fourth  

Year  

125547°— 20 36 


562 


HISTORY   OF   PRICES   DURING   THE   WAR. 


A  COMPARISON  OF  INDEX  NUMBERS  OF  WHOLESALE  PRICES  IX  THE  UNITED  STATES, 
ENGLAND,  FRANCE,  AND  CANADA— Continued- 

[Medians  of  relative  prices  of  identical  lists  of  commodities  figured  by  making  the  price  from  July  1,  1913, 

to  June  30, 1911=100.] 


All  commodities  class. 


Series  41. 


Series  270. 


France. 


United 
States. 


Canada. 


1913— Months- 
January 102  100 

February 102  100 

March 101  100 

April   ..                                             102  100 

May 102  100 

June 102  100 

July 100  100 

August 102  101 

September 102  103 

October...                          101  103 

November 100  101 

December 100  99 

Quarters — 

First 102  1 00 

Second....                          102  100 

Third  .                             101  101 

Fourth 100  101 

Year 101  101 

191-1— Months- 
January . 100  99 

February... 100  100 

March 100  100 

April...                                                  98  99 

May                                            . 100  100 

June 100  99 

July.                                                         100  97 

August 98  99 

September 98  108 

October 99  99 

November         .            99  97 

December 104  99 

Quarters— 

First 100  100 

Second...                                         99  99 

Third                                   99  101 

Fourth 101  98 

Year 100  100 

1915-Months— 

January -  -  105  100 

February...                             106  100 

March 113  103 

April...                                       Ill  101 

May 107  99 

June 100  100 

July , , 114  102 

August - 118  102 

September 127  96 

October 130  98 

November 141  102 

December 153  116 

Quarters- 
First  1 08  101 

Second 108  100 

Third                                                                            120  100 

Fourth 141  105 

Year 119  102  , 

I 


101 
100 
100 
100 
100 
100 

99 
99 
99 
99 
100 
101 


100 
100 
99 
100 

100 


101 
101 
101 
101 
100 
100 


100 
104 
102 
101 
101 


101 
100 
101 
102 

101 


102 
105 
107 
108 
109 
110 

111 
112 
111 
112 
117 
119 


105 
109 
111 
116 

110 


GOVERNMENT   CONTROL   OVER   PRICES. 


563 


A  COMPARISON  OF  INDEX  NUMBERS  OF  WHOLESALE  PRICES  IN  THE  UNITED  STATES, 
ENGLAND,  FRANCE,  AND  CANADA— Continued. 

[Medians  of  relative  prices  of  identical  lists  of  commodities  figured  by  making  the  price  from  July  1,  1913, 

to  June  30, 1914=100.] 


• 

All  commodities  class. 

Series  44. 

Series  270. 

France. 

United 
States. 

Canada. 

United 
States. 

1916—  Months— 
Janiiarv.  .                    

160 
162 
165 
167 
170 
170 

161 
163 
172 
177 
183 
189 

162 
169 
165 
183 

170 

186 

187 
184 
208 
229 
238 

265 
256 
255 
227 
227 
245 

186 
225 
259 
233 

226 

238 
238 
247 
265 
261 
257 

255 
293 
297 
297 
266 
297 

241 
261 
282 

287 

268 

127 
128 
129 
132 
134 
123 

125 
132 
134 
138 
151 
150 

128 
130 
130 
146 

134 

150 

150 
165 
171 
179 
172 

179 
186 
174 
192 
195 
200 

155 

174 
180 
196 

176 

201 
212 
219 
223 
210 
194 

209 
187 
206 
178 
179 
188 

211 

209 
201 
182 

201 

127 
130 
131 
133 
135 
135 

133 
133 
135 
139 
148 
153 

129 
134 
134 
146 

136 

157 
162 
166 
170 
180 
182 

183 
182 
181 
180 
186 
189 

161 
177 
182 
185 

176 

191 
194 
198 
198 
203 
207 

209 
209 
210 
213 
214 
213 

194 
203 
209 
213 

205 

115 
118 
121 
123 
123 
122 

123 
125 
127 
132 
141 
144 

118 
123 
125 
139 

126 

148 
/          151 
156 
170 
178 
183 

189 
187 
186 
182 
183 
182 

152 

177 
187 

182 

175 

185 
187 
188 
191 
190 
189 

193 
196 
201 
201 
201 
203 

187 
190 
197 
202 

194 

February 

March    * 

April 

May 

June  

July 

August...                                       .          

September 

October  

November 

December                                                

Quarters- 
First  

Second. 

Third 

Fourth  

Year  .  .  . 

1917—  Months— 
Januarv.  . 

February 

March  

April.   . 

May 

June  

July 

August... 

September 

October  

November 

December 

Quarters- 
First 

Second. 

Third 

Fourth  

Year 

1918—  Months— 
Januarv  ... 

February  

March 

April... 

Mav                      

June  

July 

August  

September 

October  

November..   .. 

December 

Quarters- 
First. 

Second 

Third...     . 

Fourth.  . 

Year  

BOOK  II 

GOVERNMENT  REGULATIONS  RELATING 

TO  PRICES 


565 


1.  INTRODUCTION. 


The  substance  of  all  known  formal  and  informal  regulations  relating  to 
prices,  that  were  issued  by  the  Government  during  the  war,  has  been  put  here 
into  compact  form.  The  regulations  compiled  and  digested  make  up  Book  II 
of  the  study  on  "  Government  Control  Over  Prices." 

The  Government  issued  thousands  of  regulations  during  the  war  relating 
to  production,  conservation,  curtailment,  priority,  transportation,  and  pur- 
chase which  affected  prices  indirectly  but  are  not  here  recorded.  This  digest 
does  not  comprehend  other  controls  than  those  which  pertain  strictly  to  prices. 
An  endeavor  has  been  made  even  to  cut  away  parts  of  regulations,  where  the 
whole  regulation  was  not  relevant  to  price  control. 

The  body  of  separate  regulations  that  appear  are  classified  alphabetically, 
under  one  or  another  of  the  following  main  commodity  groups :  Foods ;  fuels ; 
metals  and  metal  products ;  textiles  and  fibers ;  hides,  skins  and  leather  ;  lumber ; 
building  materials ;  chemicals ;  rubber ;  and  paper.  There  remained  two  alterna- 
tive methods  of  arrangement  each  with  its  advantages — a  classification  of  regu- 
lations under  the  Government  agencies  exercising  them,  and  a  classification 
chronologically  by  the  dates  of  their  issue.  The  former  alternative  proved  not 
feasible  since  frequently  the  same  commodity  was  controlled  by  various  boards 
at  different  times.  Its  advantages,  moreover,  can  be  had  by  reference  to  the 
main  part  of  this  investigation  where  the  commodity  controls  are  discussed 
under  the  boards  exercising  them  at  the  signing  of  the  armistice.  The  latter 
alternative  had  only  a  slight  advantage  to  recommend  it.  It  should  be  noted 
that,  although  the  regulations  are  listed  alphabetically,  it  is  possible  to  find 
quickly  the  date  of  each  regulation  and  the  Government  agent  exercising  it. 

The  Government  has  not  heretofore  attempted  any  compilation  of  war- 
time regulations  over  prices,  and  it  is  inevitable  that  this  one  will  present  slight 
omissions.  The  most  serious  of  these  are  the  many  informal  agreements  per- 
taining to  prices  which,  commodity  chiefs  made  with  their  industry,  and  of  which 
no  records  remain.  The  Government  regulations  which  are  printed  here  include 
all  that  were  found  in  the  official  sources  of  price  regulation,  and  many  others 
that  were  discovered  by  correspondence  and  by  searching  through  the  files  left 
over  from  the  war. 

The  compilers  have  not  felt  obliged  to  include  all  differential  prices,  which 
the  industry  calculated  and  printed  with  Government  approval.  These  differ- 
entials represent  simply  prices  figured  to  make  various  grades  of  goods  sell 
in  scale  with  the  base  prices  fixed  by  the  Government. 

567 


2.  FOODS. 


The  Congress  passed  the  food  and  fuel  control  act  (Public,  No.  41,  65th  Cong.) 
on  August  10,  1917,  and  thereby  gave  the  President  power  to  bring  under 
license  control  virtually  all  large  dealers  in  foodstuffs.1  The  President,  by  a 

1  There  follows  in  full  a  copy  of  the  provisions  of  the  food  and  fuel  act  of  Aug.  10,  1917 
(Public,  No.  41,  65th  Cong.,  H.  R.  4961),  which  -elate  to  food  control. 

An  Act  To  provide  further  for  the  national  security  and  defense  by  encouraging  the 
production,  conserving  the  supply,  and  controlling  the  distribution  of  food  products 
and  fuel. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the  United  States  of 
America  in  Congress  assembled,  That  by  reason  of  the  existence  of  a  state  of  war,  it  is 
essential  to  the  national  security  and  defense,  for  the  successful  prosecution  of  the  war, 
and  for  the  support  and  maintenance  of  the  Army  and  Navy,  to  assure  an  adequate  supply 
and  equitable  distribution,  and  to  facilitate  the  movement,  of  foods,  feeds,  fuel  including 
fuel  oil  and  natural  gas,  and  fertilizer  and  fertilizer  ingredients,  tools,  utensils,  imple- 
ments, machinery,  and  equipment  required  for  the  actual  production  of  foods,  feeds,  and 
fuel,  hereafter  in  this  Act  called  necessaries  ;  to  prevent,  locally  or  generally,  scarcity, 
monopolization,  hoarding,  injurious  speculation,  manipulations,  and  private  controls, 
affecting  such  supply,  distribution,  and  movement ;  and  to  establish  and  maintain  govern- 
mental control  of  such  necessaries  during  the  war.  For  such  purposes  the  instrumen- 
talities, means,  methods,  powers,  authorities,  duties,  obligations,  and  prohibitions  herein- 
after set  forth  are  created,  established,  conferred,  and  prescribed.  The  President  is 
authorized  to  make  such  regulations  and  to  issue  such  orders  as  are  essential  effectively 
to  carry  out  the  provisions  of  this  Act. 

SEC.  2.  That  in  carrying  out  the  purposes  of  this  Act  the  President  is  authorized  to 
enter  into  any  voluntary  arrangements  or  agreements,  to  create  and  use  any  agency  or 
agencies,  to  accept  the  services  of  any  person  without  compensation,  to  cooperate  with  any 
agency  or  person,  to  utilize  any  department  or  agency  of  the  Government,  and  to  coordi- 
nate their  activities  so  as  to  avoid  any  preventable  loss  or  duplication  of  efforts  or  funds. 

SEC.  3.  That  no  person  acting  either  as  a  voluntary  or  paid  agent  or  employee  of  the 
United  States  in  any  capacity,  including  an  advisory  capacity,  shall  solicit.,  induce,  or 
attempt  to  induce  any  person  or  officer  authorized  to  execute  or  to  direct  the  execution  of 
contracts  on  behalf  of  the  United  States  to  make  any  conrtact  or  give  any  order  for  the 
furnishing  to  the  United  States  of  work,  labor,  or  services,  or  of  materials,  supplies,  or 
other  property  of  any  kind  or  character,  if  such  agent  or  employee  has  any  pecuniary 
interest  in  such  contract  or  order,  or  if  he  or  any  firm  of  which  he  is  a  member,  or  cor- 
poration, joint-stock  company,  or  association  of  which  he  is  an  officer  or  stockholder,  or  in 
the  pecuniary  profits  of  which  he  is  directly  or  indirectly  interested,  shall  be  a  party 
thereto.  Nor  shall  any  agent  or  employee  make,  or  permit  any  committee  or  other  body 
of  which  he  is  a  member  to  make,  or  participate  in  making,  any  recommendation  concerning 
such  contract  or  order  to  any  council,  board,  or  commission  of  the  United  States  or  any 
member  or  subordinate  thereof,  without  making  to  the  best  of  his  knowledge  and  belief  a 
full  and  complete  disclosure  in  writing  to  such  council,  board,  commission,  or  subordinate 
of  any  and  every  pecuniary  interest  which  he  may  have  in  such  contract  or  order  and  of 
his  interest  in  any  firm,  corporation,  company,  or  association  being  a  party  thereto.  Nor 
shall  he  participate  in  the  awarding  of  such  contract  or  giving  such  order.  Any  willful 
violation  of  any  of  the  provisions  of  this  section  shall  be  punishable  by  a  fine  of  not  more 
than  $10,000,  or  by  imprisonment  of  not  more  than  five  years,  or  both  :  Provided,  That  the 
provisions  of  this  section  shall  not  change,  alter  or  repeal  section  forty-one  of  chapter 
three  hundred  and  twenty-one,  Thirty-fifth  Statutes  at  Large. 

SEC.  4.  That  it  is  hereby  made  unlawful  for  any  person  willfully  to  destroy  any 
necessaries  for  the  purpose  of  enhancing  the  price  or  restricting  the  supply  thereof ; 
knowingly  to  commit  waste  or  willfully  to  permit  preventable  deterioration  of  any  neces- 
saries in  or  in  connection  with  their  production,  manufacture,  or  distribution  ;  to  hoard, 
as  defined  in  section  six  of  this  Act,  any  necessaries  ;  to  monopolize  or  attempt  to  monopo- 
lize, either  locally  or  generally,  any  necessaries  ;  to  engage  in  any  discriminatory  and 
unfair,  or  any  deceptive  or  wasteful  practice  or  device,  or  to  make  any  unjust  or  unrea- 
sonable rate  or  charge,  in  handling  or  dealing  in  or  with  any  necessaries  ;  to  conspire, 
combine,  agree,  or  arrange  with  any  other  person,  (a)  to  limit  the  facilities  for  trans- 
porting, producing,  harvesting,  manufacturing,  supplying,  storing,  or  dealing  in  any 
necessaries ;  (b)  to  restrict  the  supply  of  any  necessaries ;  (c)  to  restrict  distribution 

568 


GOVERNMENT   REGULATIONS  RELATING  TO   PRICES.  569 

series  of  Executive  orders  and  proclamations,  put  entire  responsibility  for  food 
control  under  the  United  States  Food  Administrator,  Herbert  C.  Hoover,  and 
extended  the  list  of  foods  requiring  licenses  from  the  Food  Administration.1 

i  There  follow  the  Executive  orders  and  proclamations  issued  from  time  to  time,  and 
which  were  the  immediate  authority  from  the  President  for  the  administration  of  control : 

EXECUTIVE  ORDERS. 

Providing  for  organization  of  the  United  States  Food  Administrators,  Aug.  10,  1917. 

Providing  for  organization  of  the  Food  Administration  Grain  Corporation,  Aug.  14, 
1917. 

Directing  Treasury  Department  to  enforce  sections  15  and  16  of  food-control  act,  Sept.  2, 
1917. 

Providing  for  appointment  of  secretaries  to  Federal  Food  Administration  without  civil- 
service  examination,  Sept.  27,  1917. 

Providing  for  requisitioning  of  foods  and  feeds,  Oct.  23,  1917. 

Amending  civil-service  regulations,  Nov.  10,  1917. 

Authorizing  United  States  Food  Administration  to  find  that  fair  profit  is  normal  average 
prewar  profit,  Nov.  27,  1917. 

Designating  Food  Administration  Grain  Corporation  as  agency  of  United  States  to  pur- 
chase wheat,  and  directing  that  capital  stock  be  increased,  June  21,  1918. 

Note  regarding  formation  of  the  United  States  Sugar  Equalization  Board  (Inc.),  formed 
July  13,  1918. 

PROCLAMATIONS. 

License  of  wheat  and  rye  elevators  and  millers,  Aug.  14,  1917. 

License  of  importers,  manufacturers,  and  refiners  of  sugar,  sugar  sirups,  and  molasses, 
Sept.  7,  1917. 

License  of  manufacturers  and  distributors  of  certain  food  commodities,  Oct.  8,  1917. 

Licensing  bakers,  Nov.  7,  1917. 

License  of  arsenic  industry,  Nov.  15,  1917. 

Limiting  alcoholic  content  of  malt  liquor,  Dec.  8,  1917. 

License  of  ammonia  industry,  Jan.  3,  1918. 

Licensing  the  importation,  manufacture,  storage,  and  distribution  of  feeds  and  certain 
other  food  commodities,  Jan.  10,  1918. 

Conservation  of  wheat,  Jan.  18,  1918. 

Licensing  bakers  not  already  licensed,  and  importers  and  distributors  of  green  coffee, 
Jan.  30,  1918. 

Fixing  guaranteed  prices  for  1918  wheat  crop,  Feb.  21,  1918. 

License  of  fertilizer  industry,  Feb.  25,  1918. 

Licensing  packers  of  canned  tuna  and  others,  May  14,  1918. 

License  of  farm-equipment  industry,  May  14,  1918. 

License  of  stockyards,  June  18,  1918. 

Fixing  guaranteed  prices  for  1919  wheat  crop,  Sept.  2,  1918. 

License  of  dealers  in  live  or  dead  cattle,  sheep,  swine,  or  goats,  Sept.  6,  1918. 

Prohibiting  manufacture  of  malt  liquors,  Sept.  16,  1918. 

Licensing  operators  of  warehouses  storing  foods  and  feeds  for  hire,  and  others,  Nov.  2, 
1918. 

cf  any  necessaries;  (d)  to  prevent,  limit,  or  lessen  the  manufacture  or  production  of  any 
necessaries  in  order  to  enhance  the  price  thereof,  or  (e)  to  exact  excessive  prices  for 
any  necessaries  ;  or  to  aid  or  abet  the  doing  of  any  act  made  unlawful  by  this  section. 

SEC.  5.  That,  from  time  to  time,  whenever  the  President  shall  find  it  essential  to 
license  the  importation,  manufacture,  storage,  mining,  or  distribution  of  any  necessaries, 
in  order  to  carry  into  effect  any  of  the  purposes  of  this  Act,  and  shall  publicly  so 
announce,  no  person  shall,  after  a  date  fixed  in  the  announcement,  engage  in  or  carry 
on  any  such  business  specified  in  the  announcement  of  importation,  manufacture,  storage, 
mining,  or  distribution  of  any  necessaries  as  set  forth  in  such  announcement,  unless  he 
shall  secure  and  hold  a  license  issued  pursuant  to  this  section.  The  President  is  author- 
ized to  issue  such  licenses  and  to  prescribe  regulations  for  the  issuance  of  licenses 
and  requirements  for  systems  of  accounts  and  auditing  of  accounts  to  be  kept  by 
licensees,  submission  of  reports  by  them,  with  or  without  oath  or  affirmation,  and  the 
entry  and  inspection  by  the  President's  duly  authorized  agents  of  the  places  of  business 
of  licensees.  Whenever  the  President  shall  find  that  any  storage  charge,  commission, 
profit,  or  practice  of  any  licensee  is  unjust,  or  unreasonable,  or  discriminatory  and 
unfair,  or  wasteful,  and  shall  order  such  licensee,  within  a  reasonable  time  fixed  in  the 


570  HISTOEY  OE  PRICES   DURING  THE   WAR. 

The  whole  body  of  regulations  pertaining  to  foods  issued  by  the  Food  Admin- 
istration fall  under  general  license  regulations  (No.  I)  or  special  license  regula- 

order,  to  discontinue  the  same,  unless  such  order,  which  shall  recite  the  facts  found, 
is  revoked  or  suspended,  such  licensee  shall,  within  the  time  prescribed  in  the  order,  dis- 
continue such  unjust,  unreasonable,  discriminatory  and  unfair  storage  charge,  com- 
mission, profit,  or  practice.  The  President  may,  in  lieu  of  any  such  unjust,  unreasonable, 
discriminatory,  and  unfair  storage  charge,  commission,  profit,  or  practice,  find  what  is 
a  just,  reasonable,  nondiscriminatory  and  fair  storage  charge,  commission,  profit,  or 
practice,  and  in  any  proceeding  brought  in  any  court  such  order  of  the  President  shall  be 
prima  facie  evidence.  Any  person  who,  without  a  license  issued  pursuant  to  this  sec- 
tion, or  whose  license  shall  have  been  revoked,  knowingly  engages  in  or  carries  on 
any  business  for  which  a  license  is  required  under  this  section,  or  willfully  fails  or 
refuses  to  discontinue  any  unjust,  unreasonable,  discriminatory  and  unfair  storage 
charge,  commission,  profit,  or  practice,  in  accordance  with  the  requirement  of  an  order 
issued  under  this  section,  or  any  regulation  prescribed  under  this  section,  shall,  upon 
conviction  thereof,  be  punished  by  a  fine  not  exceeding  $5,000,  or  by  imprisonment  for 
not  more  than  two  years,  or  both  :  Provided^  That  this  section  shall  not  apply  to  any 
farmer,  gardener,  cooperative  association  of  farmers  or  gardeners,  including  live-stock 
farmers,  or  other  persons  with  respect  to  the  products  of  any  farm,  garden,  or  other 
land  owned,  leased,  or  cultivated  by  him,  nor  to  any  retailer  with  respect  to  the  retail 
business  actually  conducted  by  him,  nor  to  any  common  carrier,  nor  shall  anything  in 
this  section  be  construed  to  authorize  the  fixing  or  imposition  of  a  duty  or  tax  upon 
any  article  imported  into  or  exported  from  the  United  States  or  any  State*  Territory, 
or  the  District  of  Columbia  :  Provided  further,  That  for  the  purposes  of  this  AcT  a 
retailer  shall  be  deemed  to  be  a  person,  copartnership,  firm,  corporation,  or  association 
not  engaging  in  the  wholesale  business  whose  gross  sales  do  not  exceed  $100,000  per 
annum. 

SEC.  *6.  That  any  person  who  willfully  hoards  any  necessaries  shall  upon  conviction 
thereof  be  fined  not  exceeding  $5,000  or  be  imprisoned  for  not  more  than  two  years,  or 
both.  Necessaries  shall  be  deemed  to  be  hoarded  within  the  meaning  of  this  Act  when 
either  (a)  held,  contracted  for,  or  arranged  for  by  any  person  in  a  quantity  in  excess  of 
his  reasonable  requirements  for  use  or  consumption  by  himself  and  dependents  for  a  rea- 
sonable time ;  (b)  held,  contracted  for,  or  arranged  for  by  any  manufacturer,  wholesaler, 
retailer,  or  other  dealer  in  a  quantity  in  excess  of  the  reasonable  requirements  of  his  busi- 
ness for  use  or  sale  by  him  for  a  reasonable  time,  or  reasonably  required  to  furnish  neces- 
saries produced  in  surplus  quantities  seasonally  throughout  the  period  of  scant  or  no  pro- 
duction ;  or  (c)  withheld,  whether  by  possession  or  under  any  contract  or  arrangement, 
from  the  market  by  any  person  for  the  purpose  of  unreasonably  increasing  or  diminish- 
ing the  price :  Provided,  That  this  section  shall  not  include  or  relate  to  transactions  on 
any  exchange,  board  of  trade,  or  similar  institution  or  place  of  business  as  described  in 
section  thirteen  of  this  Act  that  may  be  permitted  by  the  President  under  the  authority 
conferred  upon  him  by  said  section  thirteen  :  Provided,  however,  That  any  accumulating 
or  withholding  by  any  farmer  or  gardener,  cooperative  association  of  farmers  or  gardeners, 
including  live-stock  farmers,  or  any  other  person,  of  the  products  of  any  farm,  garden,  or 
other  land  owned,  leased,  or  cultivated  by  him  shall  not  be  deemed  to  be  hoarding  within 
the  meaning  of  this  Act. 

SEC.  7.  That  whenever  any  necessaries  shall  be  hoarded  as  defined  in  section  six  they 
&hall  be  liable  to  be  proceeded  against  in  any  district  court  of  the  United  States  within  the 
district  where  the  same  are  found  and  seized  by  a  process  of  libel  for  condemnation,  and  if 
such  necessaries  shall  be  adjudged  to  be  hoarded  they  shall  be  disposed  of  by  sale  in  such 
manner  as  to  provide  the  most  equitable  distribution  thereof  as  the  court  may  direct,  and 
the  proceeds  thereof,  less  the  legal  costs  and  charges,  shall  be  paid  to  the  party  entitled 
thereto.  The  proceedings  of  such  libel  cases  shall  conform  as  near  as  may  be  to  the  pro- 
ceedings in  admiralty,  except  that  either  party  may  demand  trial  by  jury  of  any  issue  of 
fact  joined  in  any  such  case,  and  all  such  proceedings  shall  be  at  the  suit  of  and  in  the 
name  of  the  United  States.  It  shall  be  the  duty  of  the  United  States  attorney  for  the 
proper  district  to  institute  and  prosecute  any  such  action  upon  presentation  to  him  of 
satisfactory  evidence  to  sustain  the  same. 

SEC.  8.  That  any  person  who  willfully  destroys  any  necessaries  for  the  purpose  of  en- 
hancing the  price  or  restricting  the  supply  thereof  shall,  upon  conviction  thereof,  be  fined 
not  exceeding  $5,000  or  imprisoned  for  not  more  than  two  years,  or  both. 

SEC.  9.  That  any  person  who  conspires,  combines,  agrees,  or  arranges  with  any  other 
person  (a)  to  limit  the  facilities  for  transporting,  producing,  manufacturing,  supplying, 
storing,  or  dealing  in  any  necessaries;  (b)  to  restrict  the  supply  of  any  necessaries;  (c) 
to  restrict  the  distribution  of  any  necessaries ;  (d)  to  prevent,  limit,  or  lessen  the  manu- 
facture or  production  of  any  necessaries  in  order  to  enhance  the  price  thereof  shall,  upon 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  571 

tions  (Nos.  II  to  XX  VIII )/     These  regulations,  issued  during  the  war  in  mimeo- 
graphed and  printed  loose-leaf  form,  pertain  to  prices,  specifications,  contracts, 

1  There  follows  a  list  showing  dates  of  the  various  general  and  special  license  regulations 
issued  by  the  Food  Administration  : 

No.  T.  General  license  regulations  :  Governing  all  licenses  for  the  importation,  manufac- 
ture, storage,  and  distribution  of  food  commodities  and  feeds. 

SPECIAL   LICENSE   REGULATIONS. 

No.  II.  Wheat  millers  and  manufacturers  of  mixed  flours,  effective  July  22,  1918. 

No.  III.  A.  Elevators  and  dealers  handling  wheat,  rye,  corn,  oats,  and  barley.  B.  Corn, 
oats,  rye,  and  barley  millers.  Effective  September  23,  1918. 

No.  IV.  A.  Malsters.     B.  Near-beer  manufacturers,  effective  September  23,  1918. 

No.  V.  A.  Special  regulations  governing  dealers  in  rough  rice.  B.  Special  regulations 
governing  rice  millers  and  manufacturers  of  rice  flour,  effective  July  29,  1918. 

No.  VI.  Manufacturers  and  refiners  of  sugar,  effective  June  15,  1918. 

No.  VII.  Canners  of  peas,  tomatoes,  corn,  dried  beans,  salmon,  sardines  and  tuna,  and 
manufacturers  of  tomato  catsup,  tomato  soup,  and  other  tomato  products,  manufacturers 
of  condensed,  evaporated,  or  powdered  milk,  effective  June  15,  1918. 

No.  VIII.  Packers  of  dried  fruits,  effective  June  15,  1918. 

No.  IX.  Dealers  and  brokers  in  cotton  seed  and  peanuts  and  cotton  ginners,  crushers  of 
cotton  seed,  peanuts,  soya  beans,  palm  kernel,  and  copra.  Importers  of  peanuts,  peanut 
oil,  soya  beans,  soya-bean  oil,  palm  kernels,  palm-kernel  oil,  copra,  copra  oil,  and  palm  oil, 
and  dealers  and  brokers  in  such  imported  products.  Refiners  of  and  dealers  and  brokers 
in  cottonseed  oil,  peanut  oil,  soya-bean  oil,  palm-kernel  oil,  and  copra  oil,  effective  July  1, 
1918. 

No.  X.  Special  regulations  governing  manufacture  of  oleomargarine  and  other  butter 
substitutes,  effective  December  4,  1918. 

No.  XI.  Wholesalers,  jobbers,  importers,  retailers  :  Special  rules  applying  to  licensed 
nonperishable  food  commodities,  effective  June  15,  1918. 

No.  XII.  Brokers  and' auctioneers  of  licensed  nonperishable  food  commodities,  effective 
June  15,  1918. 

No.  XIII.  Manufacturers  of  bakery  products,  effective  September  1,  1918. 

No.  XIV.  Dealers  in  glucose,  refiners'  sirups,  maple  sirup,  sorghum,  cane-juice  sirup, 
centrifugal  molasses,  open-kettle  molasses,  West  India  molasses  and  blackstrap  molasses, 
and  manufacturers  and  mixers  of  mixed  molasses,  effective  November  7,  1918. 

No.  XV.  Distributors  of  fresh  fruits  and  vegetables. 

No.  XVI.  Distributors  of  fresh  fish  and  frozen  fish. 

No.  XVII.   Salt-water  fishermen. 

No.  XVIII.  Distributors  of  poultry,  effective  December  9,  1918. 

No.  XIX.  Distributors  of  eggs,  effective  November  11,  1918. 

No.  XX.   Manufacturers  and  distributors  of  butter,  effective  December  23,  1918. 

No.  XXI.  Manufacturers  and  distributors  of  cheese,  effective  June  12,  1918. 

No.  XXII.  Distributors  of  milk  and  cream. 

No.  XXIII.  Meat  packers  and  manufacturers  of  lard,  distributors  of  fresh  meat. 

No.  XXIV.  Cold-storage  warehousemen,  effective  August  26,  1918. 

No.  XXV.  Feeding  stuffs,  effective  August  1,  1918. 

No.  XXVI.  Directions  regarding  the  use  of  tin  and  other  containers  adopted  by  the 
United  States  Food  Administration  and  the  War  Industries  Board  applying  to  manufac- 
turers and  packers  of  baking  powder,  ground  spice,  powdered  cocoa,  chocolate,  candy,  cof- 
fee, coffee  substitutes,  tea,  spaghetti,  pickles,  hominy,  condensed  milk,  salt,  lard,  and  lard 
substitutes,  macaroni,  sirups,  and  molasses,  effective  October  1,  1918. 

No.  XXVII.  All  public  eating  places,  effective  December  17,  1918. 

No.  XXVIII.  Special  regulations  governing  licensees  engaged  in  business  as  general  stor- 
age warehousemen,  effective  December  1,  1918. 

conviction  thereof,  be  fined  not  exceeding  $10,000  or  be  imprisoned   for  not  more  than 
two  years,  or  both. 

SEC.  10.  That  the  President  is  authorized,  from  time  to  time,  to  requisition  foods, 
feeds,  fuels,  and  other  supplies  necessary  to  the  support  of  the  Army  or  the  main- 
tenance of  the  Navy,  or  any  other  public  use  connected  with  the  common  defense,  and  to 
requisition,  or  otherwise  provide,  storage  facilities  for  such  supplies ;  and  he  shall 
ascertain  and  pay  a  just  compensation  therefor.  If  the  compensation  so  determined 
be  not  satisfactory  to  the  person  entitled  to  receive  the  same,  such  person  shall  be  paid 
seventy-five  per  centum  of  the  amount  so  determined  by  the  President,  and  shall  be 


572  HISTORY   OF  PRICES   DURING   THE   WAR. 

conservation,  and  distribution.     An  endeavor  has  been  made  in  this  digest,  made 

entitled  to  sue  the  United  States  to  recover  such  further  sum  as,  added  to  said  seventy- 
five  per  centum  will  make  up  such  amount  as  will  be  just  compensation  for  such  neces- 
saries or  storage  space,  and  jurisdiction  is  hereby  conferred  on  the  United  States  Dis- 
trict Courts  to  hear  and  determine  all  such  controversies  :  Provided,  That  nothing  In 
this  section,  or  in  the  section  that  follows,  shall  be  construed  to  require  any  natural 
person  to  furnish  to  the  Government  any  necessaries  held  by  him  and  reasonably 
required  for  consumption  or  use  by  himself  and  dependents,  nor  shall  any  person,  firm, 
corporation,  or  association  be  required  to  furnish  to  the  Government  any  seed  necessary 
for  the  seeding  of  land  owned,  leased,  or  cultivated  by  them. 

SEC.  11.  That  the  President  is  authorized  from  time  to  time  to  purchase,  to  store,  to 
provide  storage  facilities  for,  and  to  sell  for  cash  at  reasonable  prices,  wheat,  flour, 
meal,  beans,  and  potatoes :  Provided,  That  if  any  minimum  price  shall  have  been 
theretofore  fixed,  pursuant  to  the  provisions  of  section  fourteen  of  this  Act,  then  the 
price  paid  for  any  such  articles  so  purchased  shall  not  be  less  than  such  minimum  price. 
Any  moneys  received  by  the  United  States  from  or  in  connection  with  the  disposal  by 
the  United  States  of  necessaries  under  this  section  may,  in  the  discretion  of  the  Presi- 
dent, be  used  as  a  revolving  fund  for  further  carrying  out  the  purposes'  of  this  section. 
Any  balance  of  such  moneys  not  used  as  part  of  such  revolving  fund  shall  be  covered 
into  the  Treasury  as  miscellaneous  receipts. 

SEC.  12.  That  whenever  the  President  shall  find  it  necessary  to  secure  an  adequate 
supply  of  necessaries  for  the  support  of  the  Army  or  the  maintenance  of  the  Navy,  or  for 
any  other  public  use  connected  with  the  common  defense,  he  is  authorized  to  requisition 
and  take  over,  for  use  or  operation  by  the  Government,  any  factory,  packing  house,  oil  pipe 
line,  mine,  or  other  plant,  or  any  part  thereof,  in  or  through  which  any  necessaries  are  or 
may  be  manufactured,  produced,  prepared,  or  mined,  and  to  operate  the  same.  Whenever 
the  President  shall  determine  that  the  further  use  or  operation  by  the  Government  of  any 
such  factory,  mine,  or  plant,  or  part  thereof,  is  not  essential  for  the  national  security  or 
defense,  the  same  shall  be  restored  to  the  person  entitled  to  the  possession  thereof.  The 
United  States  shall  make1  just  compensation,  to  be  determined  by  the  President,  for  the 
taking  over,  use,  occupation,  and  operation  by  the  Government  of.  any  such  factory,  mine, 
or  plant,  or  part  thereof.  If  the  compensation  so  determined  be  unsatisfactory  to  the 
person  entitled  to  receive  the  same,  such  person  shall  be  paid  seventy-five  per  centum  of 
the  amount  so  determined  by  the  President,  and  shall  be  entitled  to  sue  the  United 
States  to  recover  such  further  sum  as,  added  to  said  seventy-five  per  centum,  will  make  up 
such  amount  as  will  be  just  compensation,  in  the  manner  provided  by  section  twenty- 
four,  paragraph  twenty,  and  section  one  hundred  and  forty-five  of  the  Judicial  Code.  The 
President  is  authorized  to  prescribe  such  regulations  as  he  may  deem  essential  for  carrying 
out  the  purposes  of  this  section,  including  the  operation  of  any  such  factory,  mine,  or 
plant,  or  part  thereof,  the  purchase,  sale,  or  other  disposition  of  articles  used,  manufac- 
tured, produced,  prepared,  or  mined  therein,  and  the  employment,  control,  and  compensa- 
tion of  employees.  Any  moneys  received  by  the  United  States  from  or  in  connection  with 
the  use  or  operation  of  any  such  factory,  mine,  or  plant,  or  part  thereof,  may,  in  the 
discretion  of  the  President,  be  used  as  a  revolving  fund  for  the  purpose  of  the  continued 
use  or  operation  of  any  such  factory,  mine,  or  plant,  or  part  thereof,  and  the  accounts  of 
each  such  factory,  mine,  plant,  or  part  thereof,  shall  be  kept  separate  and  distinct.  Any 
balance  of  such  moneys  not  used  as  part  of  such  revolving  fund  shall  be  paid  into  the 
Treasury  as  miscellaneous  receipts. 

SEC.  13.  That  whenever  the  President  finds  it  essential  in  order  to  prevent  undue  en- 
hancement, depression,  or  fluctuation  of  prices  of,  or  in  order  to  prevent  injurious  specu- 
lation in,  or  in  order  to  prevent  unjust  market  manipulation  or  unfair  and  misleading 
market  quotations  of  the  prices  of  necessaries,  hereafter  in  this  section  called  evil  prac- 
tices, he  is  authorized  to  prescribe  such  regulations  governing,  or  may  either  wholly  or 
partly  prohibit,  operations,  practices,  and  transactions  at,  on,  in,  or  under  the  rules  of 
any  exchange,  board  of  trade,  or  similar  institution  or  place  of  business  as  he  may  find 
essential  in  order  to  prevent,  correct,  or  remove  such  evil  practices.  Such  regulations 
may  require  all  persons  coming  within  their  provisions  to  keep  such  records  and  state- 
ments of  account,  and  may  require  such  persons  to  make  such  returns,  verified  under  oath 
or  otherwise,  as  will  fully  and  correctly  disclose  all  transactions  at,  in,  or  on,  or  under 
the  rules  of  any  such  exchange,  board  of  trade,  or  similar  institution  or  place  of  business, 
including  the  making,  execution,  settlement,  and  fulfillment  thereof.  He  may  also  require 
all  persons  acting  in  the  capacity  of  a  clearing  house,  clearing  association,  or  similar  insti- 
tution, for  the  purpose  of  clearing,  settling,  or  adjusting  transactions  at,  in,  or  on,  or 
under  the  rules  of  any  such  exchange,  board  of  trade,  or  similar  institution  or  place  of 
business,  to  keep  such  records  and  to  make  such  returns  as  will  fully  and  correctly  dis- 
close all  facts  in  their  possession  relating  to  such  transactions,  and  be  may  appoint  agents 


GOVERNMENT   REGULATIONS   RELATING   TO    PRICES.  573 

possible  and  approved  by  Mr.  W.  C.  Mullendore,  of  the  legal  section  of  the  Food 

to  conduct  the  investigations  necessary  to  enforce  the  provisions  of  this  section  and  all 
rules  and  regulations  made  by  him  in  pursuance  thereof,  and  may  fix  and  pay  the  com- 
pensation of  such  agents.  Any  person  who  willfully  violates  any  regulation  made  pur- 
suant to  this  section,  or  who  knowingly  engages  in  any  operation,  practice,  or  transaction 
prohibited  pursuant  to  this  section,  or  who  willfully  aids  or  abets  any  such  violation  or 
any  such  prohibited  operation,  practice,  or  transaction,  shall,  upon  conviction  thereof,  be 
punished  by  a  fine  not  exceeding  $30,000  or  by  imprisonment  for  not  more  than  four  years, 
or  both. 

SEC.  14.  That  whenever  the  President  shall  find  that  an  emergency  exists  requiring 
stimulation  of  the  production  of  wheat  and  that  it  is  essential  that  the  producers  of 
wheat,  produced  within  the  United  States,  shall  have  the  benefits  of  the  guaranty  pro- 
vided for  in  this  section,  he  is  authorized,  from  time  to  time,  seasonably  and  as  far  in 
advance  of  seeding  time  as  practicable,  to  determine  and  fix  and  to  give  public  notice  of 
what,  under  specified  conditions,  is  a  reasonable  guaranteed  price  for  wheat,  in  order  to 
assure  such  producers  a  reasonable  profit.  The  President  shall  thereupon  fix  such  guar- 
anteed price  for  each  of  the  official  grain  standards  for  wheat  as  established  under  the 
United  States  grain  standards  Act,  approved  August  eleventh,  nineteen  hundred  and  six- 
teen. The  President  shall  from  time  to  time  establish  and  promulgate  such  regulations 
as  he  shall  deem  wise  in  connection  with  such  guaranteed  prices,  and  in  particular  gov- 
erning conditions  of  delivery  and  payment,  and  differences  in  price  for  the  several  stand- 
ard grades  in  the  principal  primary  markets  of  the  United  States,  adopting  number  one 
northern  spring  or  its  equivalent  at  the  principal  interior  primary  markets  as  the  basis. 
Thereupon,  the  Government  of  the  United  States  hereby  guarantees  every  producer  of 
wheat  produced  within  the  United  States,  that,  upon  compliance  by  him  with  the  regula- 
tions prescribed,  he  shall  receive  for  any  wheat  produced  in  reliance  upon  this  guarantee 
within  the  period,  not  exceeding  eighteen  months,  prescribed  in  the  notice,  a  price  not 
less  than  the  guaranteed  price  therefor  as  fixed  pursuant  to  this  section.  In  such  regula- 
tions the  President  shall  prescribe  the  terms  and  conditions  upon  which  any  such  pro- 
ducer shall  be  entitled  to  the  benefits  of  such  guaranty.  The  guaranteed  prices  for  the 
several  standard  grades  of  wheat  for  the  crop  of  nineteen  hundred  and  eighteen,  shall  be 
based  upon  number  one  northern  spring  or  its  equivalent  at  not  less  than  $2  per  bushel  at 
the  principal  interior  primary  markets.  This  guaranty  shall  not  be  dependent  upon  the 
action  of  the  President  under  the  first  part  of  this  section,  but  is  hereby  made  absolute 
and  shall  be  binding  until  May  first,  nineteen  hundred  and  nineteen.  When  the  President 
finds  that  the  importation  into  the  United  States  of  any  wheat  produced  outside  of  the 
United  States  materially  enhances  or  is  likely  materially  to  enhance  the  liabilities  of  the 
United  States  under  guaranties  of  prices  therefor  made  pursuant  to  this  section,  and 
ascertains  what  rate  of  duty,  added  to  the  then  existing  rate  of  duty  on  wheat  and  to 
the  value  of  wheat  at  the  time  of  importation,  would  be  sufficient  to  bring  the  price 
thereof  at  which  imported  up  to  the  price  fixed  therefor  pursuant  to  the  foregoing  pro- 
visions of  this  section,  he  shall  proclaim  such  facts,  and  thereafter  there  shall  be  levied, 
collected,  and  paid  upon  wheat  when  imported  in  addition  to  the  then  existing  rate  of 
duty,  the  rate  of  duty  so  ascertained  ;  but  in  no  case  shall  any  such  rate  of  duty  be  fixed 
at  an  amount  which  will  effect  a  reduction  of  the  rate  of  duty  upon  wheat  under  any  then 
existing  tariff  law  of  the  United  States.  For  the  purpose  of  making  any  guaranteed  price 
effective  under  this  section,  or  whenever  he  deems  it  essential  in  order  to  protect  the 
Government  of  the  United  States  against  material  enhancement  of  its  liabilities  arising 
out  of  any  guaranty  under  this  section,  the  President  is  authorized  also,  in  his  discretion, 
to  purchase  any  wheat  for  which  a  guaranteed  price  shall  be  fixed  under  this  section, 
and  to  hold,  transport,  or  store  it,  or  to  sell,  dispose  of,  and  deliver  the  same  to  any 
citizen  of  the  United  States  or  to  any  Government  engaged  in  war  with  any  country  with 
which  the  Government  of  the  United  States  is  or  may  be  at  war  or  to  use  the  same  as 
supplies  for  any  department  or  agency  of  the  Government  of  the  United  States.  Any 
moneys  received  by  the  United  States  from  or  in  connection  with  the  sale  or  disposal  of 
wheat  under  this  section  may,  in  the  discretion  of  the  President,  be  used  as  a  revolving 
fund  for  further  carrying  out  the  purposes  of  this  section.  Any  balance  of  such  moneys 
not  used  as  part  of  such  revolving  fund  shall  be  covered  into  the  Treasury  as  miscel- 
laneous receipts. 

SEC.  15.  That  from  and  .after  thirty  days  from  the  date  of  the  approval  of  this  Act  no 
foods,  fruits,  food  materials,  or  feeds  shall  be  used  in  the  production  of  distilled  spirits  for 
beverage  purposes  :  Provided,  That  under  such  rules,  regulations,  and  bonds  as  the  Presi- 
dent may  prescribe,  such  materials  may  be  used  in  the  production  of  distilled  spirits 
exclusively  for  other  than  beverage  purposes,  or  for  the  fortification  of  pure  sweet  wines 
as  defined  by  the  Act  entitled  "An  Act  to  increase  the  revenue,  and  for  other  purposes," 
approved  September  eighth,  nineteen  hundred  and  sixteen.  Nor  shall  there  be  imported 


574  HISTORY   OF   PRICES   DURING   THE  WAR. 

Administration,  to  show  simply  the  rules  relating  directly  to  food  prices.     The 

into  the  United  States  any  distilled  spirits.  Whenever  the  President  shall  find  that  limi- 
tation, regulation,  or  prohibition  of  the  use  of  foods,  fruits,  food  materials,  or  feeds  in  the 
production  of  malt  or  vinous  liquors  for  beverage  purposes,  or  that  reduction  of  the  alco- 
holic content  of  any  such  malt  or  vinous  liquor,  is  essential,  in  order  to  assure  an  adequate 
and  continuous  supply  of  food,  or  that  the  national  security  and  defense  will  be  subserved 
thereby,  he  is  authorized,  from  time  to  time,  to  prescribe  and  give  public  notice  of  the 
extent  of  the  limitation,  regulation,  prohibition,  or  reduction  so  necessitated.  Whenever 
such  notice  shall  have  been  given  and  shall  remain  unrevoked  no  person  shall,  after  a 
reasonable  time  prescribed  in  such  notice,  use  any  foods,  fruits,  food  materials,  or  feeds  iu 
the  production  of  malt  or  vinous  liquors,  or  import  any  such  liquors  except  under  license- 
issued  by  the  President  and  in  compliance  with  rules  and  regulations  determined  by  him 
governing  the  production  and  importation  of  such  liquors  and  the  alcoholic  content  thereof. 
Any  person  who  willfully  violates  the  provisions  of  this  section,  or  who  shall  use  any 
foods,  fruits,  food  materials,  or  feeds  in  the  production  of  malt  or  vinous  liquors,  or  who 
shall  import  any  such  liquors,  without  first  obtaining  a  license  so  to  do  when  a  license  is 
required  under  this  section,  or  who  shall  violate  any  rule  or  regulation  made  under  thi  ? 
section,  shall  be  punished  by  a  fine  not  exceeding  $5,000,  or  by  imprisonment  for  not  xuoro 
than  two  years,  or  both  :  Provided  further,  That  nothing  in  this  section  shall  be  con- 
strued to  authorize  the  licensing  of  the  manufacture  of  vinous  or  malt  liquors  in  any 
State,  Territory,  or  the  District  of  Columbia,  or  any  civil  subdivision  thereof,  where  the 
manufacture  of  such  vinous  or  malt  liquor  is  prohibited. 

SEC.  16.  That  the  President  is  authorized  and  directed  to  commandeer  any  or  all  dis- 
tilled spirits  in  bond  or  in  stock  at  the  date  of  the  approval  of  this  Act  for  redistilla- 
tion, in  so  far  as  such  redistillation  may  be  necessary  to  meet  the  requirements  of  the 
Government  in  the  manufacture  of  munitions  and  other  military  and  hospital  supplies, 
or  in  so  far  as  such  redistillation  would  dispense  with  the  necessity  of  utilizing  products 
and  materials  suitable  for  foods  and  feeds  in  the  future  manufacture  of  distilled  spirits 
for  the  purposes  herein  enumerated.  The  President  shall  determine  and  pay  a  just 
compensation  for  the  distilled  spirits  so  commandeered ;  and  if  the  compensation  so 
determined  be  not  satisfactory  to  the  person  entitled  to  receive  the  same,  such  person 
shall  be  paid  seventy-five  per  centum  of  the  amount  so  determined  by  the  President  and 
shall  be  entitled  to  sue  the  United  States  to  recover  such  further  sum  as,  added  to  said 
seventy-five  per  centum,  will  make  up  such  amount  as  will  be  just  compensation  for  such 
spirits,  in  the  manner  provided  by  section  twenty-four,  paragraph  twenty,  and  section 
one  hundred  and  forty-five  of  the  Judicial  Code. 

SEC.  17.  That  every  person  who  willfully  assaults,  resists,  impedes,  or  interferes  with 
any  officer,  employee,  or  agent  of  the  United  States  in  the  execution  of  any  duty 
authorized  to  be  performed  by  or  pursuant  to  this  Act  shall  upon  conviction  thereof  be 
fined  not  exceeding  $1,000  or  be  imprisoned  for  not  more  than  one  year,  or  both. 

SBC.  18.  That  the  sum  of  $2,500,000  is  hereby  appropriated,  out  of  any  moneys  in  the 
Treasury  not  otherwise  appropriated,  to  be  available  until  June  thirtieth,  nineteen 
hundred  and  eighteen,  for  the  payment  of  such  rent,  the  expense,  including  postage,  of 
such  printing  and  publications,  the  purchase  of  such  material  and  equipment,  ana  tne 
employment  of  such  persons  and  means,  in  the  city  of  Washington  and  elsewhere,  as  the 
President  may  deem  essential. 

SBC.  19.  That  for  the  purposes  of  this  Act  the  sum  of  $150,000,000  is  hereby  appropri- 
ated, out  of  any  moneys  in  tne  Treasury  not  otherwise  appropriated,  to  be  available 
during  the  time  this  Act  is  in  effect:  Provided,  That  no  part  of  this  appropriation  shall 
be  expended  for  the  purposes  described  in  the  preceding  section :  Provided  furtlter,  That 
itemized  statements  covering  all  purchases  and  disbursements  under  this  and  the  pre- 
ceding section  shall  be  filed  with  the  Secretary  of  the  Senate  and  the  Clerk  of  tho 
House  of  Representatives  on  or  before  the  twenty-fifth  day  of  each  month  after  the 
taking  effect  of  this  Act,  covering  the  business  of  the  preceding  month,  and  said  state- 
ments shall  be  subject  to  public  inspection. 

SBC.  20.  That  the  employment  of  any  person  under  the  provisions  of  this  Act  shall  not 
exempt  any  such  person  from  military  service  under  the  provisions  of  the  selective  draft 
law  approved  May  eighteenth,  nineteen  hundred  and  seventeen. 

SEC.  21.  The  President  shall  cause  a  detailed  report  to  be  made  to  the  Congress  on  the 
first  day  of  January  each  year  of  all  proceedings  had  under  this  Act  during  the  year 
preceding.  Such  report  shall,  in  addition  to  other  matters,  contain  an  account  of  all 
persons  appointed  or  employed,  the  salary  or  compensation  paid  or  allowed  each,  the 
amount  of  the  different  kinds  of  property  purchased  or  requisitioned,  the  use 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  575 

original  issue  numbers  of  all  rules,  and  their  exact  headings,  have  been  retained, 
but  parts  not  relevant  to  prices  are  omitted. 

and  disposition  made  of  such  property,  and  a  statement  of  all  receipts,  payments,  and 
expenditures,  together  with  a  statement  showing  the  general  character,  and  estimated 
value  of  all  property  then  on  hand,  and  the  aggregate  amount  and  character  of  all  claims 
against  the  United  States  growing  out  of  this  Act. 

SEC.  22.  That  if  any  clause,  sentence,  paragraph,  or  part  of  this  Act  shall  for  any  reason 
be  adjudged  by  any  court  of  competent  jurisdiction  to  be  invalid,  such  judgment  shall  not 
affect,  impair,  or  invalidate  the  remainder  thereof,  but  shall  be  confined  in  its  operation 
to  the  clause,  sentence,  paragraph,  or  part  thereof,  directly  involved  in  the  controversy  in 
which  such  judgment  shall  have  been  rendered. 

SEC.  23.  That  words  used  in  this  Act  shall  be  construed  to  import  the  plural  or  the 
singular,  as  the  case  demands.  The  word  "person,"  wherever  used  in  this  Act,  shall 
include  individuals,  partnerships,  associations,  and  corporations.  When  construing  and 
enforcing  the  provisions  of  this  Act,  the  act,  omission,  or  failure  of  any  official,  agent,  or 
other  person  acting  for  or  employed  by  any  partnership,  association,  or  corporation  within 
the  scope  of  his  employment  or  office  shall,  in  every  case,  also  be  deemed  the  act,  omission, 
or  failure  of  such  partnership,  association,  or  corporation  as  well  as  that  of  the  person. 

SEC.  24.  That  the  provisions  of  this  Act  shall  cease  to  he  in  effect  when  the  existing 
state  of  war  between  the  United  States  and  Germany  shall  have  terminated,  and  the  fact 
and  date  of  such  termination  shall  be  ascertained  and  proclaimed  by  the  President ;  but 
the  termination  of  this  Act  shall  not  affect  any  act  done,  or  any  right  or  obligation  accru- 
ing or  accrued,  or  any  suit  or  proceeding  had  or  commenced  in  any  civil  case  before  the 
said  termination  pursuant  to  this  Act ;  but  all  rights  and  liabilities  under  this  Act  arising 
before  its  termination  shall  continue  and  may  be  enforced  in  the  same  manner  as  if  the  Act 
had  not  terminated.  Any  offense  committed  and  all  penalties,  forfeitures,  or  liabilities 
incurred  prior  to  such  termination  may  be  prosecuted  or  punished  in  the  same  manner  and 
with  the  same  effect  as  if  this  Act  had  not  been  terminated. 

SBC.  26.  That  any  person  carrying  on  or  employed  in  commerce  among  the  several 
States,  or  with  foreign  nations,  or  with  or  in  the  Territories  or  other  possessions  of  the 
United  States  in  any  article  suitable  for  human  food,  fuel,  or  other  necessaries  of  life, 
who,  either  in  his  individual  capacity  or  as  an  officer,  agent,  or  employee  of  a  corporation 
or  member  of  a  partnership  carrying  on  or  employed  in  such  trade,  shall  store,  acquire, 
or  hold,  or  who  shall  destroy  or  make  away  with  any  such  article  for  the  purpose  of 
limiting  the  supply  thereof  to  the  public  or  affecting  the  market  price  thereof  in  such 
commerce,  whether  temporarily  or  otherwise,  shall  be  deemed  guilty  of  a  felony  and, 
upon  conviction  thereof,  shall  be  punished  by  a  fine  of  not  more  than  $5,000  or  by 
imprisonment  for  not  more  than  two  years,  or  both  :  Provided,  That  any  storing  or 
holding  by  any  farmer,  gardner,  or  other  person  of  the  products  of  any  farm,  garden, 
or  other  land  cultivated  by  him  shall  not  be  deemed  to  be  a  storing  or  holding  within 
the  meaning  of  this  Act:  Provided  further,  That  farmers  and  fruit  growers,  cooperative 
and  other  exchanges,  or  societies  of  a  similar  character  shall  not  be  included  within  the 
provisions  of  this  section  :  Provided  further  That  this  section  shall  not  be  construed  to 
prohibit  the  holding  or  accumulating  of  any  such  article  by  any  such  person  in  a  quantity 
not  in  excess  of  the  reasonable  requirements  of  his  business  for  a  reasonable  time  or  in 
a  quantity  reasonably  required  to  furnish  said  articles  produced  in  surplus  quantities 
seasonally  throughout  the  period  of  scant  or  no  production.  Nothing  contained  in  this 
section  shall  be  construed  to  repeal  the  Act  entitled  "An  Act  to  protect  trade  and  eoin- 
•merce  against  unlawful  restraints  and  monopolies,''  approved  July  second,  eighteen  hun- 
dred and  ninety,  commonly  known  as  the  Sherman  Antitrust  Act. 

SEC.  27.  That  the  President  is  authorized  to  procure,  or  aid  in  procuring,  such  stocks? 
of  nitrate  of  soda  as  he  may  determine  to  bo  necesary,  and  find  available,  for  increasing 
agricultural  production  during  the  calendar  years  nineteen  hundred  and  seventeen  and 
eighteen,  and  to  dispose  of  the  same  for  cash  at  cost,  including  all  expenses  connected 
therewith.  For  carrying  out  the  purposes  of  this  section,  there  is  hereby  appropriated, 
out  of  any  moneys  in  the  Treasury  not  otherwise  appropriated,  available  immediately 
and  until  expended,  the  sum  of  $10,000,000,  or  so  much  thereof  as  may  be  n-ecessary,  and 
th-p  President  is  authorized  to  make  such  regulations,  and  to  use  such  means  and  nancies 
of  the  Government,  as,  in  his  discretion,  he  may  deem  best.  The  proceeds  arising  from 
the  disposition  of  the  nitrate  of  soda  shall  go  into  the  Treasury  as  miscellaneous  receipts. 

Approved,  August  10,  1917. 


576  HISTORY  OF  PRICES  DURING  THE  WARo 

GENERAL  REGULATIONS. 

The  following  general  rules  correspond  to  general  rules,  series  B,  which  became 
effective,  unless  otherwise  noted,  on  November  1,  1917 : 

Rule  1.  Reports  to  be  furnished. — It  shall  be  the  duty  of  each  licensee  to 
give  to  such  representative  as  may  be  designated  by  the  United  States  Food 
Administrator,  whenever  the  said  representative  shall  so  require,  any  informa- 
tion concerning  the  conditions  and  management  of  the  business  of  the  licensee. 
Reports,  when  requested  by  said  representative,  shall  be  made  on  such  blanks, 
to  be  furnished  by  the  United  States  Food  Administration,  as  the  United  States 
Food  Administrator  may  designate,  giving  complete  information  regarding  trans- 
actions in  any  commodities  imported,  manufactured,  refined,  packed,  purchased, 
contracted  for,  received,  sold,  stored,  shipped  or  otherwise  handled,  distributed 
or  dealt  with  by  the  licensee,  or  on  hand,  in  the  possession  or  under  the  control  of 
the  licensee,  and  any  other  information  concerning  the  business  of  the  licensee 
that  such  representative  may  require  from  time  to  time.  Whenever  the  said 
representative  shall  require  it,  the  licensee  shall  furnish  such  information  in 
writing  under  oath. 

Rule  2.  Property  and  records  to  be  open  to  inspection. — The  authorized  repre- 
sentative of  the  United  States  Food  Administrator  shall  be  at  full  liberty,  dur- 
ing ordinary  business  hours,  to  inspect  any  and  all  property  stored  or  held  in 
possession  or  under  the  control  of  the  licensee,  and  all  records  of  the  licensee. 
All  necessary  facilities  for  such  inspection  shall  be  extended  to  the  said  repre- 
sentative by  the  licensee,  its  agents  and  servants. 

Rule  3.  Must  keep  records. — The  licensee  shall  keep  such  records  of  his  busi- 
ness as  shall  make  practicable  the  verification  of  all  reports  rendered  to  the 
United  States  Food  Administration. 

NOTE. — Records  of  "  drop  shipments  "  are  to  be  included  in  the  records  of  the  whole- 
saler as  well  as  of  the  manufacturer  or  retailer. 

Rule  5.  Unreasonable  profits  prohibited. — The  licensee  shall  not  import,  manu- 
facture, store,  distribute,  sell,  or  otherwise  handle  any  food  commodities  on  an 
unjust,  exorbitant,  unreasonable,  discriminatory,  or  unfair  commission,  profit, 
or  storage  charge. 

NOTES. — Special  profit  regulations. — In  addition  to  this  general  rule  requiring  that 
profits  should  be  reasonable,  the  licensee  in  most  lines  of  business  will  find  special  rules 
dealing  more  explicitly  with  the  profits  permitted  in  his  business. 

Licensee  performing  two  functions. — In  cases  where  a  licensee,  in  addition  to  his  princi- 
pal business,  performs  another  function  customarily  performed  by  a  different  type  of 
licensee,  as  where  a  manufacturer  distributes  through  a  jobbing  department  directly  to  the 
retail  trade,  he  will  be  permitted  to  make  a  reasonable  charge  for  each  service,  provided — 

(a)  That  he  keeps  such  separate  accounts  of  his  operations  as  to  enable  him  to  make 
the  reports  required  of  persons  licensed  to  perform   that  function,   and  to  enable  such 
reports  to  be  verified  ;  and 

(b)  Conforms  to  the  regulations  of  the  Food  Administration  in  respect  to  the  supple- 
mentary function  which  he  performs. 

In  many  cases,  however,  the  licensee's  service  and  his  expense  of  operation  will  not  be 
as  great  as  that  of  persons  engaged  exclusively  in  a  similar  business,  and  in  such  case  he 
willnot  be  allowed  to  charge  as  great  a  margin  as  is  permitted  to  such  other  licensee. 

Cold-storage  warehouse  charges. — This  rule  prohibits  cold-storage  warehouse  licensees 
from  making  unreasonable  or  discriminatory  charges  in  handling  or  storing  food  com- 
modities. 

The  United  States  Food  Administration  recognizes  the  principle  that  up  to  a  certain 
point  it  ordinarily  costs  less  per  unit  to  handle  large  quantities  than  to  handle  small 
quantities,  and  large  lots  than  small  lots,  of  a  particular  commodity,  and  has  no  objection, 
to  licensees  charging  a  lesser  rate  per  unit  for  large  quantities  or  lots  than  for  small 
quantities  or  lots  if  the  diiferentiation  in  rates  is  based  on  variation  of  cost  in  handling  the 
particular  commodity. 

Hereafter,  the  above-mentioned  principle  must  be  applied  by  cold-storage  warehousemen 
in  arranging  any  variations  in  rates  or  discounts  for  quantity  contained  in  schedules  of 
rates  or  amendments  thereto  that  are  filed. 

With  respect  to  rate  schedules  now  on  file  in  which  lower  rates  for  large  lots  or 
discounts  for  quantity  are  stated,  no  objection  has  been  or  will  be  made  to  differentia- 
tions in  rates  unless  they  are  obviously  merely  arbitrary  or  discriminatory  or  in  effect 
constitute  a  preference  to  one  or  a  few  patrons,  cr  unless  upon  investigation  they  are 
found  to  be  without  reasonable  justification. 

All  rates  must  of  course  be  contained  in  the  schedule  required  to  be  filed  with  the 
United  States  Food  Administration  and  must  be  clear,  explicit,  well  defined,  and  intel- 
ligible. Every  patron  is  entitled  to  know  his  exact  classification  and  the  specific  rate  he 
is  to  be  charged. 

Application  of  maximum  margins  of  profits  to  ex-port  transactions. — All  sales  made 
in  the  United  States  are  governed  by  the  margins  of  profit  indicated  by  the  Food  Admin- 
istration except  sales  made  by  exporters  who  extend  credit  abroad  or  sell  on  letters  of 
credit  and  actually  ship  the  goods  abroad,  provided,  however,  that  where  a  manufacturer 
or  dealer  sells  to  an  exporter  for  shipment  on  the  exporter  s  own  account,  or  for  ship- 
ment as  an  agent  for  the  buyer,  such  sales  will  not  be  governed  by  the  margins  pre- 
scribed by  the  Food  Administration  for  domestic  sales  if  the  seller  can  show  that  the 
goods  are  shipped  abroad  without  any  storage  or  resale  in  1he  United  States.  (Opinion 
A-125,  Dec.  10,  1918.) 


GOVERNMENT  REGULATIONS   RELATING  TO   PRICES.  577 

Rule  6.  Resales  within  same  trade  prohibited,  when. — The  licensee,  in  selling 
food  commodities,  shall  keep  such  commodities  moving  to  the  consumer  in  as 
direct  a  line  as  practicable  and  without  unreasonable  delay.  Resales  within 
the  same  trade  without  reasonable  justification,  especially  if  tending  to  result 
in  a  higher  market  price  to  the  retailer  or  consumer,  will  be  dealt  with  as  an 
unfair  practice. 

NOTE. — Special  resale  regulations. — See  pamphlets  containing  special  regulations  for  ap- 
plication of  this  rule  to  particular  businesses  and  commodities. 

Dealers  in  nonperishable  commodities  will  find  a  full  statement  explaining  what  resales 
are  reasonable  in  their  business  in  the  special  license  regulations  applying  to  them  under 
Rule  A-6. 

Resales  in  poultry,  eggs,  butter,  cheese,  coffee,  and  rice  are  dealt  with  bv  special  regula- 
tion under  the  rules  applying  to  dealers  in  those  commodities. 

In  cases  of  resale,  any  broker  concerned  shares  the  same  responsibility  as  the  buyer  and 
seller. 

Resales  that  may  be  permitted  should  be  made  subject  to  such  measure  of  control  as  the 
Federal  food  administrator  in  the  particular  State  deems  it  necessary  to  exercise.  In 
some  States,  for  example,  the  administrator  has  required  the  parties  to  a  proposed  resale 
to  file  with  him  affidavits  or  other  evidence  sufficient  to  establish  the  fact  that  the  particu- 
lar lot  of  goods  being  resold  bears  but  one  wholesale  profit  between  the  manufacturer  and 
the  retailer.  A  similar  principle  applies  to  resales  between  retailers. 

Rule  7.  Speculation  prohibited. — No  broker  or  other  licensee  shall  buy  or  sell 
any  food  commodity  for  his  own  account  unless  he  is  also  regularly  engaged  in 
and  holds  himself  out  to  the  trade  as  conducting  the  business  of  distributing 
such  commodity  otherwise  than  on  a  commission  or  brokerage  basis,  or  unless 
he  uses  such  commodities  in  manufacturing,  provided  that  this  rule  shall  not 
apply  to  sales  on  an  exchange,  board  of  trade,  or  similar  institution. 

Rule  8.  Sales  to  speculators  forbidden. — No  licensee  shall  knowingly  sell  any 
food  commodity  to  a  broker  or  other  licensee  who  is  not  buying  for  personal 
consumption  or  engaged  in  using  such  commodity  in  manufacturing,  or  who 
is  not  regularly  engaged  in  and  holding  himself  out  to  the  trade  as  conducting 
the  business  of  distributing  such  commodity  otherwise  than  on  a  commission  or 
brokerage  basis,  provided  that  this  rule  shall  not  apply  to  sales  on  an  exchange, 
board  of  trade,  or  similar  institution. 

NOTE. — The  regulation  of  exchange  transactions  is  not  a  function  of  license  regulations, 
and  under  section  13  of  the  food-control  act  will  be  handled  by  special  regulation  from 
time  to  time. 

There  is  no  general  rule  9  in  the  present  series.  See  special  rules  applying  to  vour 
business. 

Rule  10.  Unfair  practices  forbidden. — The  licensee  shall  not  buy,  contract 
for,  sell,  store,  or  otherwise  handle  or  deal  in  any  food  commodities  for  the  pur- 
pose of  unreasonably  increasing  the  price  or  restricting  the  supply  of  such  corn- 
-modities,  or  of  monopolizing,  or  attempting  to  monopolize,  either  locally  or  gen- 
erally, any  of  such  commodities. 

Rule  18.  Secret  rebates  prohibited.— No  licensee  shall  make  any  allowance  or 
payment  to  the  agent  or  employee  of  any  exchange,  association,  or  other  person 
from  whom  he  buys,  or  to  whom  he  sells,  or  for  whom  he  handles  commodities 
on  commission  without  the  permission  of  the  principal  of  such  agent.  If  such 
permission  is  not  in  writing,  immediate  written  notice  shall  be  sent  to  the  prin- 
cipal by  the  licensee  on  the  account  sales  or  otherwise,  giving  the  amount  of 
the  payment  and  the  name  of  the  agent,  exchange,  or  association  to  whom  paid. 
( Rule  issued  Nov.  1,  1917,  prohibited  rebates  "  without  written  permission  of 
principal."  Amended  to  present  form  Apr.  4,  1918;  repealed  Dec.  16,  1918.) 

If  general  written  permission  is  given  by  the  principal  for  his  agent  to  receive  commis- 
sions from  a  particular  broker  or  other  person,  written  permission  or  notice  is  not  required 
in  case  of  each  individual  commission. 

.  Payments  or  allowances  to  an  agent  of  the  shipper  by  a  licensee  for  any  services  what- 
ever which  the  agent  renders  to  the  licensee  are  not  permissible  without  the  permission 
of  the  shipper. 

The  fact  that  a  broker  makes  no  charge  to  the  owner  for  forwarding  to  another  locality 
goods  that  he  can  not  sell  in  his  own  field  does  not  obviate  the  necessity  of  obtaining  the 
permission  of  the  owner  to  the  receipt  by  the  broker  of  an  allowance  or  payment  from 
the  new  consignee. 

Rule  19.  Market  quotations  must  not  be  misleading. — The  licensee  shall  not 
issue,  or  make  public,  market  quotations  or  make  any  statements  to  any  person 
regarding  the  price  at  which  food  commodities  are  being  sold,  which  quotations 
or  statements  can  not  be  verified  either  from  his  own  records  or  from  the  records 


125547°— 20 37 


578  HISTORY   OF  PRICES   DURING  THE   WAR. 

of  other  licensees,  and  shall  not  make  any  other  misleading  statements  which 
tend  to  enhance  the  price  of  any  food  commodities. 

NOTES. — This  rule  does  not  make  the  licensee  responsible  for  distributing  market  re- 
ports published  by  reputable  and  established  market  news  agencies  bearing  the  name  of 
the  publishers. 

It  is  not  necessary  to  inform  a  shipper  that  a  quotation  is  subject  to  a  charge  for  broker- 
age if  it  is  the  general  understanding  of  the  trade  that  such  a  quotation  is  subject  to 
such  a  charge. 

Rule  23  (as  amended  Dec.  3,  1918).  Combination  sales  prohibited. — No  licensee 
dealing  in  food  commodities  at  retail  shall  make  or  ofter  to  make  any  combina- 
tion sales  of  any  food  commodity. 

A  combination  sale  is  (1)  any  sale  or  delivery  of  two  or  more  commodities, 
or  of  two  or  more  kinds  or  sizes  of  the  same  commodity,  at  a  price  effective 
only  if  they  are  bought  at  the  same  time;  or  (2)  any  sale  or  delivery  of  a 
commodity  upon  condition  that  the  purchaser  shall  buy  some  other  commodity, 
or  some  other  kind  or  size  of  the  same  commodity.  (Rule  issued  Jan.  28,  19is! 
permitted  sales  of  sugar  with  corn  meal,  and  wheat  flour  with  substitutes. 
Changed  Sept.  1,  1918,  permitting  only  combination  sales  of  wheat  flour  with 
substitutes.  Dec.  3,  1918,  all  combination  sales  prohibited;  repealed  Feb  1 
1919.) 

SPECIAL  REGULATIONS. 
II.  WHEAT  MILLERS  AND  MANUFACTURERS  OF  MIXED  FLOURS. 

PROFITS,  PRICES,  AND  DIFFERENTIALS. 

Rule  M.  S.  11  (as  amended  Sept.  20,  1918).  Wheat  flour,  mixed  flour,  and  feed 
to  be  sold  at  reasonable  advance  over  cost  of  wheat  and  packages. — The  wheat 
miller  shall  sell  flour  and  feed  at  not  more  than  a  reasonable  advance  over 
the  average  purchase  price  of  the  wheat  from  which  it  is  manufactured,  plus 
the  cost  of  packages;  provided  that  if  any  such  miller  pays  more  for  wheat 
than  the  customary  market  price  in  that  locality,  as  evidenced  by  the  fail- 
guaranteed  price  basis  established  by  the  President's  proclamation  of  February 
21,  1918,  he  shall  not  be  permitted  to  include  in  his  average  purchase  price,  for 
the  purpose  of  this  rule,  the  excess  over  such  customary  market  price.  (Rule 
issued  Nov.  1,  1917,  allowed  a  profit  of  25  cents  per  barrel  on  flour  and  50 
cents  per  ton  on  feed.  Dec.  25,  1917,  differentials  on  various  w^heat  mill  feeds 
indicated.  May  2,  1918,  differentials  changed  on  wheat  mill  feed.  Changed  to 
present  form  July  22,  1918;  repealed  Dec.  19,  1918.) 

NOTE. — Fair  price  schedules. — The  United  States  Food  Administration  will  publish 
from  time  to  time  and  furnish  to  any  wheat  miller  a  maximum  fair  price  schedule  for 
flour  and  feed  established  with  relation  to  the  guaranteed  price  basis  for  wheat.  Any 
sales  of  wheat  flour,  mixed  flour,  whole  wheat  or  graham  flour,  or  wheat  mill  feed  in 
excess  of  this  fair  price  schedule  will  be  regarded  as  a  violation  of  the  above  rule,  and 
any  sale  at  a  price  at  or  below  the  fair  price  schedule  will  be  regarded  as  a  compliance 
with  the  above  rule. 

Mixed  -flours. — The  above  rule  and  fair  price  schedule  apply  to  "  mixed  flour  "  and 
whole  wheat  and  graham  flour,  as  well  as  to  wheat  flour.  Sales  of  mixed  flour,  whole 
wheat  and  graham  flour  will  be  considered  to  return  an  excessive  profit  if  made  at 'a 

Srice  in  excess  of  the  fair  price  schedule  or  of  the  licensee's  current  selling  price  of  wheat 
our. 

Soft  wheat  feeds. — The  Food  Administration  will  regard  as  reasonable  the  sale  of  soft 
winter  wheat  mill  feeds  at  a  price  not  more  than  $2  in  excess  of  the  maximum  fair  price 
schedule  for  other  wheat  mill  feeds ;  provided  that  all  shipments  or  deliveries  of  such 
mill  feeds  are  made  in  packages  which  are  plainly  marked  "  soft  winter  wheat." 

Interest  on  arrival  drafts. — Interest  on  arrival  drafts  on  sales  of  flour  and  feed  may  be 
included  in  invoices  as  a  separate  item,  and  is  chargeable  over  the  fair  price  schedules 
where  definite  arrangements  to  that  effect  are  made  between  buyer  and  seller. 

Self-rising  wheat  flour. — The  Food  Administration  will  regard  as  reasonable  the  sale 
of  self-rising  wheat  flour  at  a  price  not  more  than  50  cents  per  barrel  over  the  licensee's 
maximum  fair  price  schedule  for  100  per  cent  straight  grade  wheat  flour. 

Blenders. — The  Food  Administration  will  regard  as  reasonable  a  margin  of  25  cents  per 
barrel  over  average  cost  for  blending  wheat  flours  or  for  blending  wheat  flours  with  sub- 
stitutes, the  cost  to  be  considered  as  the  average  invoice  price  delivered  at  the  blending 
plant.  To  the  above  carload  basis  it  will  be  considered  reasonable  that  blenders  add  the 
selling  margins  covering  various  classes  of  sales,  as  per  rule  M.  S.  14. 

Wheat  screenings. — Any  sales  of  wheat  screenings  in  excess  of  the  fair  price  schedule 
for  bran  will  be  regarded  as  a  violation  of  rule  M.  S.  11  and  cause  for  revoking  the 
offender's  license.  (Aug.  24,  1918  ;  canceled  Dec.  3,  1918.) 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES. 


579 


Rule  M.  S.  12.  Package  charge. — In  arriving  at  the  per  barrel  package  cost 
for  the  purpose  of  rule  11  the  licensee  shall  use  the  current  cost  of  two  98-pound 
cotton  sacks  of  standard  size  and  grade  as  quoted  for  lots  of  1,000  bags,  plus 
any  freight  or  transportation  charges.  The  charge  for  any  other  size  or  style 
of  packages  as  furnished  by  mill  or  buyer  shall  be  calculated  on  the  basis  of 
such  98-pound  cotton  sacks,  plus  or  minus  the  differential  which  will  be  indi- 
cated from  time  to  time  by  the  United  States  Food  Administration.  (Differen- 
tials for  various  sizes  and  kinds  of  wheat  flour  packages  indicated  Dec.  25,  1917 ; 
differentials  changed  Mar.  23,  1918;  changed  to  present  form  July  22,  1918; 
repealed  Dec.  19,  1918.) 

Rule  M.  S.  13. — Flour  price  schedule  and  differentials  should  be  displayed  in 
mill.  The  wheat  miller  shall  cause  to  be  displayed  in  his  principal  place  of 
business  and  mills,  warehouses,  and  agencies  maintained,  controlled,  or  oper- 
ated by  him  such  flour  price  schedule  and  package  differentials  as  may  be  fur- 
nished to  him  from  time  to  time  by  the  United  States  Food  Administration,  and 
a  schedule  showing  cost  of  sacks  and  other  charges.  He  shall  furnish  copies  of 
any  such  documents  to  buyers  upon  request.  (Issued  July  22,  1918;  repealed 
Dec.  19,  1918.) 

PACKAGE  DIFFERENTIALS. 
[Basis,  98  pounds  cotton.] 


Weight. 

Kind. 

Charge  over 
bulk  price 
for  packing 
in  buyer's 
packages. 

196  wood 

$0  60  over  basis 

$0.05 
.15 
.05 
.05 
.05 
.05 
.10 
.10 
.10 
.10 
.15 
.15 
.15 
.20 
.25 
.25 
.35 
.35 
.35 
.50 
.10 
.10 
.12 
.12 
.18 
.18 
.20 
.25 
.30 
.30 
.45 
.45 
.45 
.75 

98  wood 

$1  35  over  basis 

98,  cotton 

Basis  (2  to  barre 
Same  as  basis 

1)  

140  jute 

98,  jute                      

$0.05  over  basis 
$0.20  under  basi 
$0.20  over  basis 
Same  as  basis  .  . 

2  to  barrel)  

96,  cotton 

3  (2  to  barrel)  .  .  . 

49  cotton 

4  to  barrel) 

48,  cotton            .          

24  £  cotton 

$0.45  over  basis 
$0.25  over  basis 
$0.80  over  basis 
$0.60  over  basis 
$1.20  over  basis 
$0.90  over  basis 
$1.10  over  basis 
$1.05  over  basis 
$1.70  over  basis 
$1.55  over  basis 
$1.70  over  basis 
$2.65  over  basis 
$0.05  under  basi 
$0.25  under  basi 
$0.05  over  basis 
$0.05  under  basi 
$0.25  over  basis 
$0.05  over  basis 
$0.50  over  basis 
$0.15  over  basis 
$0.40  over  basis 
$0.55  over  basis 
$0.70  over  basis 
$0.85  over  basis 
$0.95  over  basis 
$1.60  over  basis 

8  to  barrel)... 

24  cotton 

8  to  barrel) 

12J  ,  cotton                 

16  to  barrel)  

12  cotton 

16  to  barrel) 

10  cotton 

20  to  barrel) 

8,  cotton                    

24  to  barrel)  

7,  cotton 

28  to  barrel) 

6  cotton 

32  to  barrel) 

5,  cotton          .  .  .  .  

40  to  barrel)  

3J  cotton 

56  to  barrel) 

64  to  barrel) 

2,  cotton 

96  to  barrel)  .        .   . 

49  paper 

3  (4  to  barrel) 

48,  paper  

3  (4  to  barrel)  

24|  paper 

8  to  barrel) 

24,  paper  

3  (8  to  barren  

12J  ,  paper      .. 

16  to  barrel)  

12,  paDer 

16  to  barrel) 

10  paper 

20  to  barrel) 

8,  paper      .  . 

24  to  barrel)  

7,  paper 

28  to  barrel) 

6,  paper  

32  to  barrel)  

5,  paper    

40  to  barrel)  .... 

3i  paper 

56  to  barrel) 

3  ,  paper  

64  to  barrel)  

2,  paper 

'  96  to  barrel)  .  ..                           

Outside  jute  or  cotton  envelopes,  $0.60  per  barrel  additional,  10  cents. 

Outside  paper  envelopes,  $0.40  per  barrel  additional,  10  cents. 

All  sales  to  be  made  basis  98-pound  cotton. 

Where  flour  is  sold  on  basis  98-pound  cotton  sacks  and  delivery  is  made  In  buyer's 
sacks,  the  invoice  price  shall  be  arrived  at  by  deducting  from  the  selling  price  the  cur- 
rent cost  of  two  98-pound  cotton  sacks.  To  bulk  price  thus  obtained  shall  be  added 
charges  over  bulk  price  for  packing  flour  in  buyer's  sacks  as  named  above. 

Seller  or  buyer  may  not  have  option  of  shipping  flour  in  cotton  or  jute  sacks  where 
either  have  been  specified  at  time  of  sale,  except  as  may  be  agreed  to  by  buyer  and  seller 
at  time  of  shipment.  (Note  to  rule  12,  effective  Sept.  18,  1918.) 

Rule  M.  S.  14  (as  amended  Sept.  20,  1918).  Maximum  permissible  margins 
over  car-lot  bulk  on  various  classes  of  sales. — All  sales  of  wheat  flour  and  wheat 
mill  feed  shall  be  classified  as  follows,  and  the  wheat  miller  shall  not  charge 


580  HISTORY   OF   PRICES   DURING  THE  WAR. 

more  than  the  maximum  margins  indicated  for  each  class  over  his  car-lot  price, 
bulk,  mill,  cash,  or  draft  terms : 

Class  A.  Sales  to  any  buyer  in  carload  lots,  bulk,  mill,  cash,  or  draft  attached 
to  bill  of  lading.  Basis. 

Class  B.  Sales  to  any  buyer  in  mixed  carloads  of  wheat  flour,  wheat-flour  sub- 
stitutes, and  feeds :  Flour,  not  more  than  25  cents  per  barrel  over  basis.  Feed, 
not  more  than  50  cents  per  ton  over  basis. 

Class  C.  Sales  of  "  consigned  "  flour  to  wholesale  dealers  from  cars  or  docks, 
in  carload  lots  (not  delivered).  25  cents  per  barrel  over  basis. 

Class  D.  Sales  of  "  consigned  "  flour  to  wholesale  dealers,  from  cars  or  docks ; 
in  less  than  carload  lots  ( not  delivered ) ,  35  cents  per  barrel  over  basis. 

Class  E.  Sales  of  flour  to  any  buyer,  other  than  individual  consumer,  less  than 
carload  lots  (not  delivered)  and  excepting  sales  as  per  Schedules  "  C  "  and  "  D," 
not  more  than  50  cents  per  barrel  over  basis. 

Class  F.  Sales  of  flour  in  less  than  carload  lots  to  individual  consumers  (not 
including  bakers  or  public-eating  places)  :  Not  more  than  $1.20  per  barrel  over 
basis. 

Class  G.  Sales  of  feed  to  wholesale  dealers  in  less  than  carload  lots  and  not 
less  than  1  ton :  Not  more  than  $1  per  ton  over  basis. 

Class  H.  Sales  of  feed  to  retail  dealers  in  less  than  carload  lots  and  not  less 
than  1  ton :  Not  more  than  $2  per  ton  over  basis. 

Class  I.  Sales  of  feed  in  less  than  ton  lots  to  feed  dealers :  Not  more  than  $3 
per  ton  over  basis. 

Sales  of  feed  to  consumers. — Sales  of  feed  to  consumers  must  be  made  at  not 
more  than  a  reasonable  margin  over  basis.  The  Federal  food  administrator  of 
the  State  where  the  mill  is  located  will  indicate  what  margins  will  be  considered 
reasonable, 

NOTES. — Credit  and  delivery  on  flour. — Not  more  than  25  cents  per  barrel  for  delivery 
and  credit  may  be  charged  in  addition  to  the  above  margins  where  flour  is  delivered  to  the 
buyer's  door,  including  all  charges  for  credit,  if  credit  is  extended.  Where  credit  is  ex- 
tended without  delivery,  only  the  actual  interest  may  be  added. 

Brokerage. — Brokerage  may  not  be  added  to  the  fair  price  schedule  either  on  flour  or 
feed. 

Credit  and  delivery  charges  on  feed. — Not  more  than  a  reasonable  cartage  or  trucking 
charge  may  be  made  where  mill  feed  is  delivered  to  the  buyer's  door.  Where  credit  is 
extended  only  the  actual  interest  may  be  added. 

Cartage. — No  charge  for  cartage  or  trucking  on  flour  or  feed  to  a  station  or  dock  at  the 
town  where  the  mill  is  located  may  be  made. 

Only  one  margin  over  oasis  permitted. — Not  more  than  one  of  the  margins  over  basis,  as 
Indicated  above,  shall  be  added  by  the  wheat  miller  on  the  sale  of  any  lot  of  flour  or  feed. 

Rule  M.  S.  15.  Permissible  price  differential  for  farina,  purified  middlings, 
semolina,  or  special  granular  macaroni  flour. — Wheat-flour  millers  manufactur- 
ing farina,  purified  middlings,  semolina,  or  special  granular  macaroni  Hour. 
under  the  special  permission  of  the  United  States  Food  Administration,  flour 
milling  section,  Washington,  D,  C.,  may  charge  a  price  for  such  products  not  to 
exceed  40  cents  per  barrel  above  the  licensee's  fair  price  of  100  per  cent  straight- 
grade  flour  on  date  of  sale.  (Issued  July  22,  1918 ;  repealed  Dec.  19,  1918.) 

Rule  M.  S.  16.  Price  differential  on  table  bran.— Bran  intended  for  human 
consumption,  so-called  table  bran,  may  be  sold  at  a  reasonable  advance  over 
the  licensee's  fair  price  for  bran.  (Issued  July  22,  1918 ;  repealed  Dec.  19,  1918.) 

Rule  M.  S.  17,  Differentials  and  returns  on  wheat  mill  feed. — In  selling  wheat 
mill  feed  to  the  consumer  at  the  mill  door,  if  the  purchaser  desires  to  buy  wheat 
•mill  feed  in  bulk  and  the  sacks  are  emptied  and  left  at  the  mill  in  undamaged 
condition,  the  miller  shall  not  add  to  the  purchase  price  any  charge  for  sacks.  In 
selling  various  grades  of  wheat  mill  feeds  in  carload  lots,  on  terms  of  cash  or 
draft  attached  to  bill  of  lading,  the  miller  shall  sell  same  at  a  price  not  in  excess 
of  his  car-lot  price  for  mixed  feed,  bulk  mill,  plus  or  minus  the  following 
differentials : 

Shorts,  standard  middlings,  gray  shorts,  gray  middlings,  flour  middlings,  or 
red  dog,  with  or  without  screenings,  75  cents  per  ton  over  basis.  Bran,  with  or 
without  screenings,  $1.25  per  ton  under  basis. 

NOTE. — The  wheat  miller  may  make  such  separations  of  wheat  mill  feeds  as  his  trade 
may  demand,  but  if  the  total  returns  received  by  him  from  the  sale  of  wheat  mill  feed 
manufactured  from  any  given  wheat  exceeds  the  amount  which  the  Pood  Administration 
considers  to  return  a  reasonable  profit  on  an  equal  quantity  of  wheat  mixed  feed,  i.  e., 
the  entire  mill  run  of  wheat  mill  feed,  it  will  be  considered  that  the  miller  has  violated 
rule  M.  S.  11. 

Rule  M.  S.  19.  Differential  for  reconditioning  and  blending.— The  licensee  who 
blends  or  reconditions  flour  not  of  his  own  manufacture  shall  not  sell  such  flour 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


581 


in  carload  lots  at  more  than  25  cents  per  barrel  over  the  purchase  price ;  pro- 
vided that  in  making  sales  of  the  character  of  those  described  in  rule  14  under 
classes  B,  C,  D,  E,  and  F,  he  may  add  not  to  exceed  the  additional  margins  pre- 
scribed therein  for  such  sales.  (Issued  July  22,  1918 ;  repealed  Dec.  19,  1918.) 

NOTE. — This  rule  does  not  apply  to  wheat  millers  mixing  their  own  wheat  flour  with 
purchased  wheat  or  substitute  flours.  Such  mixed  flour  must  be  sold  at  not  more  than 
the  licensee's  price  for  wheat  flour,  in  accordance  with  rule  M.  S.  11. 

Rule  M.  S.  20  (as  amended  Sept.  20,  1918).  Custom  and  exchange  grinding.— 
The  wheat  miller  who  receives  wheat  from  farmers'  wagons  and  grinds  such 
wheat  on  a  toll  basis,  or  exchanges  such  wheat  for  flour  and  feed,  shall  charge 
not  to  exceed  35  cents  per  bushel  for  each  60  pounds  of  cleaned  wheat  so  received, 
and  on  such  basis  he  shall  return  to  the  farmer  flour  and  feed  in  accordance  with 
the  following  schedule : 


Test  weight  of 
of  wheat  per 
bushel. 

Number  pounds 
flour  returnable. 

Number  pounds 
hard-wheat  feed 
returnable. 

Number  pounds 
soft-  wheat  feed 
returnable. 

Pounds. 

158 

44 

15 

14 

57 

43  i 

56 

42| 

164 

15i 

55 

42 

17 

16 

54 

411 

161 

53 

40J 

17$ 

52 

m 

18J 

51 

39 

20 

19 

i  Or  heavier. 


(Rules  issued  Mar.  20,  1918,  limited  farmer  to  30  days'  supply,  and  if  sold 
without  substitutes  a  certificate  was  required  restricting  him  to  30  days'  supply 
to  be  used  only  for  human  consumption  by  his  own  household.  Changed  as 
noted  here  July  22,  except  that  millers  were  not  required  to  do  custom  and 
exchange  grinding.  Sept.  20,  1918,  millers  were  required  to  continue  such  grind- 
ing, as  noted  here.  Repealed  Dec.  3,  1918.) 

CONTRACTING  AND  SHIPPING. 

Rule  M.  S.  21  (as  amended  Sept.  20,  1918).  Uniform  contract  prescribed. — The 
wheat  miller  shall  not  sell  any  wheat  or  mixed  flour  in  quantities  of  more  than 
50  barrels,  or  wheat  mill  feed  in  quantities  of  more  than  5  tons,  except  by 
signet  contract  in  the  form  prescribed  below.  He  shall  not  contract  to  sell 
wheat  flour,  mixed  flour,  or  wheat  mill  feed  in  any  quantities  without  stipu- 
lating that  the  terms  of  the  uniform  Food  Administration  contract  shall  pre- 
vail. He  shall  fill  out  in  every  such  contract  covering  flour  the  flour  charge 
items  appearing  under  "  Method  of  calculating  maximum  delivered  fair  price," 
and  in  every  such  contract  covering  feed  the  feed  charge  items  appearing 
thereunder,  and  shall  print  under  the  item  "  Reasonable  price  schedule  "  the 
figures  furnished  to  the  miller  by  the  United  States  Food  Administration  for 
that  purpose. 

NOTE. — This  rule  requires  the  confirmation  by  written  contract  of  every  telegraphic 
or  other  order  for  flour  of  more  than  50  barrels  or  more  or  feed  of  more  than  5  tons,  even 
though  by  reason  of  shortage  in  time  the  flour  is  shipped  before  the  actual  signing  of 
the  contract.  Until  such,  contract  is  signed  it  shall  be  understood  that  the  trans- 
action is  subject  to  the  terms  and  conditions  of  the  United  States  Food  Administration 
contract. 

Orders  taken  by  salesmen  may  be  taken  on  regular  mill  contract  forms,  which  may 
not  show  all  details  as  listed  in  rule  M.  S.  21,  but  in  such  case  the  memoranda  forms  must 
bear  notation  as  follows  :  "  This  order  is  taken  subject  to  conditions  of  the  uniform  con- 
tract prescribed  by  the  United  States  Food  Administration,  and  buyer  and  seller  hereby 
agree  to  execute  such  contract  in  writing  on  the  United  States  Food  Administration 
contract  forms  and  with  all  prescribed  details  shown." 

Millers  who  have  had  their  contract  and  invoice  forms  printed  in  accordance  with  the 
regulations  issued  on  July  22,  1918,  may  use  such  contracts  and  invoices  until  ex- 
hausted, conforming  in  their  charges  to  the  minor  changes  now  made.  (Rule  of  Nov.  1, 
1917,  provided  contract  for  sales  of  25  barrels  or  more  of  wheat  or  rye.  July  22,  1918, 
same  provision  added  for  sales  of  5  tons  or  more  of  wheat  mill  feed.  Mixed  flour  added 
and  changed  to  50  barrels  as  noted  here,  Dec.  19,  1918.) 


582 


HISTORY   OF  PRICES   DURING  THE  WAR. 


Contract  No. 


CONTRACT  FORM   PRESCRIBED  BY   RULE   21. 

Date__ 


of  _.  sell(s),  and 


of buy(s),   the 

following  commodities,  on  the  terms  and  conditions  stated  below  : 

Timf.  of  /shipment  ) 

Time  ot  {delivery    / 

Destination : — 

Terms  of~payment - Draft,  through 

.Bank  of- 


Prices  named  in  this  contract  are  based  on   (a)   effective  price  schedule,   (b)   "  class  of 
sale,"   (c)  freight  charge,  and  (d)  package  charge,  as  specified  below  : 


Number 
packages. 

Size. 

Kind. 

Brand. 

B  ulk  price  f.o.b. 
mill. 

Deli  vered  price 
in  packages. 

METHOD  OF  CALCULATING  MAXIMUM  DELIVERED  FAIR  PRICE. 
[Flour  in  98-pound  cotton  sacks.] 


Flour  per 
barrel. 

Feed  per 
ton. 

(a)  Maximum  fair  price  bulk  mill  as  per  schedule  No.  —  

(6)  Maximum  differential  if  any  on  sale  of  class  — 

(c)  Freight  charge  (including  freight  tax)        .         

(d)  Cost  of  sacks  (98-  pound  cotton  for  flour) 

T0tai                                              

(The  schedules,  note,  and  detailed  terms  and  conditions  below  may  be  placed  on  reverse 

of  contract  form  if  desired.) 

MAXIMUM  PERMISSIBLE  MARGINS  OVER  BASIS  ON  VARIOUS  CLASSES  OF  SALES. 


Class 
of 
sale. 

Millsaleto— 

How  sold. 

Flour, 
per 
barrel. 

Feed, 
per 
ton. 

A 

Anyone            

Carload  lots,  bulk  mill,  cash  or  draft  at- 

None. 

None. 

tached  to  B/L. 

B 

Anyone         

Mixed  carloads  of  wheat  flour,  mixed  flour, 

$0.25 

$0.50 

wheat  flour  substitutes  and  feeds  . 

o 

Wholesale  dealers 

From  cars  or  docks,  car  lots  (not  delivered) 

.25 

where  flour  has  been  forwarded  "on  con- 
signment." 

j) 

From  cars  or  docks,  less  than  carload  (not 

.35 

delivered)  where  flour  has  been  forwarded 
'  '  on  consignment.  " 

E 

Less  carloads  (except  class  C  or  D  sales)  (not 

.50 

sumer. 

delivered). 

F 

Less  carloads 

1.20 

cept  bakers  and  public  eat- 
ing places). 

G  

Wholesale  feed  dealers  

Less  carloads  and  2,000  pounds  or  over 

1.00 

H 

Retail  feed  dealers 

Less  carloads  and  2,000  pounds  or  over 

2.00 

l 

All  feed  dealers 

Less  than  1  ton 

3.00 

GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  583 

Credit  and  delivery  on  flour.  —  Not  more  than  25  cents  per  barrel  may  be  charged  in 
addition  to  .the  above  margins  where  flour  is  delivered  to  the  buyer's  door,  including  all 
charges  for  credit,  if  credit  is  extended.  Where  credit  is  extended  without  delivery  only 
the  actual  interest  may  be  added. 

Brokerage.  —  Brokerage  may  not  be  added  to  the  fair-price  schedule  either  on  flour  or 
feed. 

Credit  and  delivery  on  feed.  —  Not  more  than  a  reasonable  cartage  or  trucking  charge 
may  be  made  where  mill  feed  is  delivered  to  the  buyer's  door.  Where  credit  is  extended 
only  the  actual  interest  may  be  added. 

Cartage.  —  No  charge  for  cartage  or  trucking  on  flour  or  feed  to  a  station  or  dock  at  the 
town  where  the  mill  is  located  may  be  made. 

Sales  of  feed  to  consumers  must  be  made  at  not  more  than  a  reasonable  margin  over 
basis.  The  Federal  food  administrator  of  the  State  where  the  mill  or  warehouse  is 
located  will  indicate  what  margin  will  be  considered  reasonable. 

Only  one  margin  over  carload  basis  permitted.  —  Not  more  than  one  of  the  margins  over 
carload  basis,  as  indicated  above,  shall  be  added  by  the  wheat  miller  on  the  sale  of  any 
lot  of  flour  or  feed. 

TERMS  AND  CONDITIONS. 


(2) 
is  sol 


It  is  understood  and  agreed-*— 

(1)   Food  Administration  regulations.  —  That  the  buyer  and  seller  shall  conform,  to  all 
regulations  promulgated  by  the  United  States  Food  Administration. 

)   Net  weights.  —  That  the  wheat  flour  and  wheat  mill  feed  covered  by  this  contract 
ld  on  the  basis  of  net  weights  when  packed,  and  the  determining  factor  as  to  weight 
shall  be  a  moisture  content  not  in  excess  of  Government  allowance. 

(3)  Contract  not  subject  to   change.  —  That  there  are  no   conditions,   representations, 
or  warrants,  oral  or  otherwise,  and  that  there   shall   be  no  assignment  or  cancellation 
of  this  contract  except  as  herein  stated,  and  that  no  agent  or  representative  has  authority 
to  modify  the  printed  terms  of  this  contract. 

(4)  Shipments  within  60  days.  —  That  the  above  order  shall  be  shipped  or  delivered  as 
specified  within  60  days  from  the  time  that  the  order  is  confirmed  by  the  seller  unless  a 
shorter  time  is  expressly  provided. 

(5)  Routing.  —  That  the  seller  shall  have  the  right  to  route  all  shipments  unless  other- 
wise stated  in  this  contract. 

(G)   Nonextension  of  time.  —  That  there  shall  be  no  extension  of  the  time  of  shipments 
or  delivery  under  this  contract  except  as  herein  specified. 

(7)  Buyer's  nonfulfillment  of  contract.  —  That  if  the  buyer  shall  fail  to  file  with  the 
seller  within  30  days  of  the  date  of  confirmation  of  this  contract  shipping  instructions 
permitting  the  seller  to  ship  at  his  option  within  the  remaining  period  of  the  contract, 
then  the  seller  may  cancel  this  contract  and  the  buyer  shall  pay  to  the  seller  an  entry 
charge  of  25  cents  per  barrel  on  tlour  and  50  cents  per  ton  on   feed,  plus  or  minus  the 
market  difference,  provided  that  if  such   shipping  instructions  are   received   before   the 
expiration  of  60  days  from  the  date  of  confirmation  of  this  contract,  and  prior  to  any 
cancellation   being   sent,    the    seller's    right    to    cancel    shall    cease.     If    the    buyer    shall 
refuse  to  accept  any  shipment  or  delivery  as  specified  hereunder  or  fail  to  perform  any 
of  the  otner  terms  of  this  agreement,  then  the  seller  may  cancel  this  contract,  and  the 
buyer  shall  pay  to  the  seller  the  entry  charge  above  provided,  plus  or  minus  the  market 
difference.     In  addition  thereto  the  seller  may  pursue  such  further  remedies  as  the  law 
may  provide. 

(8)  Seller's  nonfulfillment  of  contract.  —  That  if  the  seller  shall   fail  except   for    the 
reasons  specified  in  paragraph  9  of  this  contract  to  make  any  shipment  or  delivery  as 
specified,  then  the  buyer  may,  at  his  option,  cancel  this  contract  at  any  time  before  actual 


shipment,  and  the  seller  shall  pay  to  the  buyer  the  sum  jot  25  cents  per  barrel  on  flour 
and  50  cents  per  ton  on  feed,  plus  or  minus  the 
such  further  remedies  as  the  law  may  provide. 


and  50  cents  per  ton  on  feed,  plus  or  minus  the  market  difference.     The  buyer  may  pursue 


(9)  Exceptions  to  seller's  responsibilities. — That  if  this  contract  can  not  be  performed 
by  the  seller  within  the  time  specified,  because  of  Government  contracts  not  in  contem- 
plation at  the  time  of  the  contract,  or  because  of  fires,  strikes,  labor  difficulties,  acts  of 
carriers,  or  other  causes  beyond  the  control  of  the  seller,  and  if  the  seller  notifies  the 
buyer  of  such  inability,  stating  the  specific  cause,  as  soon  as  he  knows  that  such  inability 
will  prevent  performance,  and  in  any  event  on  or  before  the  date  of  shipment  or  delivery, 
the  seller  shall  not  be  responsible  for  failure  to  perform.     In  such  event  the  buyer  shall 
have  the  option  of  canceling  the  contract  at  the  market  difference,  provided  he  exercises 
such  option  within  24  hours  from  the  time  when  he  receives  notice  of  the  seller's  In- 
ability to  perform.     If  such  option  is  not  exercised,  the  contract  time  of  shipment  or 
delivery  shall  be  extended  until  a  reasonable  time  after  the  termination  of  seller's  in- 
ability is  removed,  but  not  to  exceed  30  days  beyond  the  original  date  of  shipment  or 
delivery.     At  the  end  of  such  additional  30  days'  period  the  buyer  shall  again  have  the 
right  to  cancel  as  above  provided,  or  the  contract  shall  be  similarly  extended. 

(10)  Buyer's  responsibility  for  final  payment. — That  where  buyer  specifies  the  bank 
through  which  draft  is  to  be  presented  and  to  whom   payment  is  to   be  made  by   the 
buyer,  the  buyer  shall  be  responsible  for  final  payment  to  the  seller. 

(11)  Package  differentials. — That  both  buyer  and  seller  agree  to  the  shipment  or  de- 
livery of  commodities  named  in  this  contract  on  the  basis  of  the  package  differentials  in 
effect  at  date  of  sale  as  promulgated  by  the  United  States  Food  Administration. 


Seller. 
By  - 


By 


584 


HISTORY   OF  PRICES  DURING  THE   WAR. 


Rule  M.  S.  22.  Uniform  invoice  prescribed. — The  wheat  miller  shall  invoice 
all  wheat  flour  and  wheat  mill  feed,  except  sales  to  individual  consumers,  and 
except  sales  of  15  barrels  or  less  of  flour  and  3  tons  or  less  of  mill  feed,  on  an 
invoice  form  on  the  front  or  back  of  which  shall  be  printed  all  information 
shown  in  this  rule  and  in  the  form  prescribed,  the  schedule  of  "  reasonable 
prices  "  to  be  in  accordance  with  schedule  which  will  be  furnished  any  miller. 
He  shall  fill  out  in  every  such  invoice  covering  flour,  the  flour  charge  items  ap- 
pearing under  "  Method  of  calculating  invoice  price,"  and  in  every  invoice  cover- 
ing feed  the  feed  charge  items  under  such  heading. 

The  following  items  shall  appear  on  front  or  back  of  every  invoice : 

REASONABLE    PRICE    SCHEDULE     (BULK    MILL). 


Schedule 
No. 

Flour. 

Bran. 

Wheat  mixed  feeds. 

Middlings,  shorts, 
red-dog. 

(Here  insert  figures  furnished  you  by  Food  Administration.) 

I  I  I 


Soft  wheat  feeds. — The  Food  Administration  will  regard  as  reasonable  the  sale  of  wheat 
mill  feeds  containing  not  less  than  90  per  cent  soft  winter  wheat  at  a  price  not  more  than 
$2  in  excess  of  the  maximum  fair-price  schedule  for  other  wheat  mill  feeds  ;  provided  that 
all  shipments  or  deliveries  of  such  mill  feeds  are  made  in  packages  which  are  plainly 
marked  "  Manufactured  from  soft  winter  wheat." 

NOTE. — The  schedule  of  prices  indicated  above  is  based  upon  a  determined  wheat  value 
as  indicated  by  the  Government  reasonable  price  guarantee  and  a  maximum  permissible 
miller's  charge.  Any  price  in  excess  of  that  based  on  the  schedules  printed  in  this  con- 
tract should  be  reported  to  the  Federal  food  administrator  for  your  State.  (Issued  July 
22,  1918;  repealed  Dec.  19,  1918.) 

MAXIMUM  PERMISSIBLE  MARGINS  OVER  BASIS  ON  VARIOUS  CLASSES  OF  SALES. 


Class  of 
sale. 

Mill  sale  to— 

How  sold. 

Flour 
per 
barrel. 

Feed 
per  ton. 

A  

Anyone  

Carload  lots,  bulk  mill,  cash  or  draft  attached 
to  B/L. 

Non& 

None. 

B 

Anvone  

Mixed  carloads  of  wheat  flour,  mixed  flour, 

$0.25 

$0.50 

wheat-flour  substitutes,  and  feeds. 

C 

Wholesale  dealers  

From  cars  or  docks,  car  lots  (not  delivered), 

.25 

where  flour  has  been  forwarded  "on  con- 
signment." 

D 

Wholesale  dealers 

From  cars  or  docks,  less  than  carload  (not 

.35 

delivered),  where  flour  has  been  forwarded 
"on  consignment." 

E 

Anyone  other  than  consumer 

Less  carloads  (except  class  C  or  D  sales)  (not 

.50 

delivered). 

F 

1.20 

cept   bakers  and   public 
eating  places). 

1  00 

H 

Less  carloads  and  2,000  pounds  or  over 

2.00 

I 

All  feed  dealers 

Less  than  1  ton 

3.00 

» 

Sales  of  feed  to  consumers  must  be  made  at  not  more  than  a  reasonable  margin  over 
basis.  The  Federal  food  administrator  of  the  State  where  the  mill  or  warehouse  is  located 
will  indicate  what  margin  will  be  considered  reasonable. 

Only  one  margin  over  carload  lasis  permitted. — Not  more  than  one  of  the  margins  over 
carload  basis,  as  indicated  above,  shall  be  added  by  the  wheat  miller  on  the  sale  of  any 
lot  of  flour  or  feed. 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  585 

Credit  and  delivery  on  flour. — Not  more  than  25  cents  per  barrel  may  be  charged  in 
addition  to  the  above  margins  where  flour  is  delivered  to  the  buyer's  door,  including  all 
charges  for  credit  if  credit  is  extended.  Where  credit  is  extended  without  delivery  only 
the  actual  interest  may  be  added. 

Brokerage. — Brokerage  may  not  be  added  to  the  fair  price  schedule  either  on  flour  or 
feed. 

Credit  and  delivery  charges  on  feed. — Not  more  than  a  reasonable  cartage  or  trucking 
charge  may  be  made  where  mill  feed  is  delivered  to  the  buyer's  door.  Where  credit  is 
extended  only  the  actual  interest  may  be  added. 

Cartage. — No  charge  for  cartage  or  trucking  on  flour  or  feed  to  a  station  or  dock  at  the 
town  where  the  mill  is  located  may  be  made. 

METHOD  OF  CALCULATING  MAXIMUM  FAIR  INVOICE  PRICE. 

[Flour,  basis  98-pound  cotton  sacks.] 


Flour 
per  barrel. 

Feed, 
per  ton. 

(a)  Maximum  fair  price  bulk  mill  as  per  Schedule  No.  —  .  .      .           

(b)  Maximum  differential,  if  any,  onlsale  of  class  — 

(d)  Cost  of  sacks  (98-pound  cotton  for  flour)  

Total 

Millers  who  have  had  their  contract  and  invoice  forms  printed  in  accordance  with  the 
regulations  issued  on  July  22,  1918,  may  use  such  contracts  and  invoices  until  exhausted, 
conforming  in  their  charges  to  the  minor  changes  now  made. 

Rule  M.  S.  23.  Change  in  destination  or  point  of  shipment.— The  wheat  miller, 
in  invoicing  where  change  in  destination  is  made  at  the  request  of  the  buyer  and 
such  change  results  in  a  freight  rate  other  than  that  specilied  in  the  original 
contract,  shall  charge  to  the  buyer  any  additional  freight  charge  over,  and  credit 
to  the  buyer  any  lesser  freight  charge  under,  that  specified  in  the  contract.  If 
the  wheat  miller  makes  a  change  in  point  of  shipment  from  that  originally 
named  in  the  contract,  such  change  of  point  of  shipment  shall  not  result  in 
change  of  delivered  cost  to  buyer.  In  such  case  the  bulk  mill  price  and  freight 
charge  shown  on  the  invoice  must  be  identical  with  similar  prices  and  charges 
shown  in  the  original  contract.  (Issued  July  22,  1918;  repealed  Dec.  19,  1918.) 

Rule  M.  S.  30  (as  amended  Nov.  12,  1918).  Contracts  must  provide  for  delivery 
in  60  days. — The  wheat  miller  shall  not  make  any  contract  for  the  sale  or 
delivery  of  wheat  flour,  mixed  flour,  or  wheat  mill  feed  for  shipment  or  delivery 
more  than  60  days  after  the  making  of  such  contract,  provided  that  this  rule  shall 
not  apply  to  contracts  with  the  Federal,  State,  county,  or  municipal  Govern- 
ments or  with  the  Government  of  any  nation  at  war  with  Germany.  (Rule  of 
Sept.  1,  1917,  limited  contracts  for  wheat  flour  to  30  days.  Changed  Sept.  1, 
1918,  to  30  days'  supply  of  wheat  flour  or  mixed  flour.  Changed  Sept.  20,  1918, 
to  include  wheat  mill  feed.  Changed  to  60  days  as  noted  here  Nov.  12,  1918 ;  re- 
pealed Dec.  19,  1918.) 

III.  WHEAT,  CORN,  OATS,  RYE,  AND  BARLEY. 

A.  SPECIAL  LICENSE  REGULATIONS  GOVERNING  OPERATORS  OF  ELE- 
VATORS WAREHOUSES,  OR  OTHER  PLACES  FOR  THE  STORAGE  OF 
WHEAT,  RYE,  CORN,  OATS,  AND  BARLEY,  AND  DEALERS  IN  WHEAT, 
RYE,  CORN,  OATS,  AND  BARLEY. 

Rules  1  to  3  relate  to  storage  only. 

Rules  4  to  8  relate  to  dealings  in  wheat  only. 

Rules  9  to  13  relate  to  dealings  in  corn,  oats,  barley,  and  rye. 

Rule  9.  Grain  to  be  sold  at  reasonable  advance  over  cost,  hedging-  considered. — 
The  licensee  shall  sell  corn,  oats,  rye,  and  barley  at  not  more  than  a  reasonable 
advance  over  the  average  cost  of  the  stock  of  such  commodity  on  hand  or  under 
the  control  of  the  licensee  not  at  that  time  contracted  to  be  sold.  In  arriving  at 
the  cost  thereof  he  shall  take  into  consideration  the  gain  or  loss  from  any  hedg- 
ing transaction  on  any  recognized  grain  exchange.  (Issued  Jan.  28,  1918.) 


586  HISTORY   OF  PRICES   DURING  THE   WAR. 

B.  SPECIAL  LICENSE  REGULATIONS  GOVERNING  LICENSEES  EN- 
GAGED IN  THE  BUSINESS  OF  MANUFACTURING  CORN,  OATS,  RYE, 
OR  BARLEY  PRODUCTS. 

The  manufacture  and  distribution  of  the  following:  corn,  oats,  rye,  and  barley 
products  are  licensed : 

Barley  flour.  Oerealine  flakes. 

Rye  flour.  Corn  oil. 

Oatmeal.  Corn  sirup. 

Rolled  oats.  Glucose. 

Hominy.  Corn  sugar. 

Corn  grits.  Products    and   by-products   of   shelled 

Corn  meal.  corn,  ear  corn,  oats,  rye,  and  barley 

Corn  flour.  for    use    as    feed,    including    grain 

Starch  from  corn.  screenings. 
Oat  flour. 

NOTE. — Any  corn,  oats,  or  barley  millers  who  resell  corn,  oats,  or  barley  without  milling 
them  must  have  a  license  to  deal  in  these  commodities  and  are  subject  to  rules  governing 
dealers  therein.  Any  corn,  oats,  or  barley  miller  buying  any  products  of  corn,  oats,  or 
barley  and  reselling  them  must  have  a  license  to  deal  therein,  and  are  subject  to  the  rules 
governing  jobbers  in  such  commodities. 

Rule  4.  Unreasonable  profits  prohibited. — The  licensee  shall  sell  edible  prod- 
ucts of  corn,  oats,  rye,  and  barley  at  not  more  than  a  reasonable  margin  over  the 
average  cost  to  him  of  the  corn,  oats,  rye,  or  barley  from  which  such  edible 
products  are  manufactured.  In  estimating  such  average  cost  he  shall  include 
all  grain  in  his  possession  or  under  his  control  by  contract  or  other  arrangement, 
but  he  shall  not  include  any  grain  which  he  has  contracted  to  sell  or  the 
products  of  which  he  has  contracted  to  sell.  Provided,  that  in  determining  the 
cost  of  such  grain  he  shall — 

(1)  Add  to  the  average  purchase  price  the  loss,  and  deduct  from  the  average 
purchase  price  the  gain,  resulting  from  any  hedging  transactions  on  an  estab- 
lished grain  exchange  in  which  the  transaction  is  finally  closed.     The  loss  or  gain 
on  such  transaction  shall  be  calculated  on  the  average  price  of  all  outstanding 
hedging  sales  or  purchases. 

(2)  He  shall  deduct  from  the  average  purchase  price  the  proceeds  from  the 
sale  of  feed  or  offal  created  in  the  milling  operation,  or,  if  not  sold,  he  shall 
deduct  its  current  market  value. 

Any  average  once  calculated  shall  be  taken  as  the  basis  for  such  averaged  grain 
in  all  subsequent  calculations. 

He  shall  keep  records  in  such  manner  as  to  show  how  all  averages  and  selling 
prices  have  been  determined.  (Rule  issued  Sept.  1,  1917,  provided  rye  or  rye 
products  should  not  be  handled  on  unjust  or  unreasonable  profit.  Rule  of  Nov. 
1,  1917,  provided  rye  flour  should  be  sold  at  not  more  than  reasonable  advance 
over  cost.  Issued  July  20,  1918,  as  noted  here ;  repealed  Feb.  1,  1919. ) 

Semiannual  profits. — The  Food  Administration  will  consider  a  net  earning  of  more 
than  6  per  cent  upon  the  gross  sales  of  any  edible  products  of  corn,  oats,  rye,  or  barley 
as  shown  at  the  end  of  any  semiannual  period,  to  be  prima  facie  evidence  of  a  violation 
of  the  rule  which  prohibits  the  taking  of  unreasonable  profits  (general  rule  5).  This 
limitation  does  not  modify  or  abrogate  the  general  principle  contained  in  the  Food  Admin- 
istration regulations  that  a  licensee  should  not  earn  more  than  a  reasonable  net  profit  on 
his  capital  invested,  nor  does  it  change  in  any  way  the  maximum  margins  which  have 
been  prescribed  on  individual  sales.  (Issued  Sept.  1,  1918.) 

(New,  Nov.  7,  1918.)  Semiannual  profits  of  wet  corn  millers. — The  Food  Administra-. 
tion  will  consider  a  net  earning  of  more  than  6  per  cent  upon  the  gross  sales  of  all  prod- 
ucts or  by-products  of  corn,  whether  such  products  or  by-products  are  sold,  pure  or  mixed 
with  other  commodities,  by  any  licensee  engaged  in  the  milling  of  corn  for  the  production 
of  starch  or  glucose  and  other  products  from  the  manufacture  of  starch,  to  be  prima  facie 
evidence  of  a  violation  of  the  rule  which  prohibits  the  taking  of  unreasonable  profits 
(general  rule  I — A — 5).  This  percentage  will  be  calculated  for  each  of  the  two  semi- 
annual periods  making  up  the  licensee's  fiscal  year.  The  Federal  income  and  excess-profits 
taxes  may  not  be  deducted  as  expenses  or  otherwise,  but  all  other  taxes  may  be  consid- 
ered as  expenses.  This  limitation  does  not"  modify  or  abrogate  the  general  principle  con- 
tained in  the  Food  Administration  regulations  that  a  licensee  should  not  earn  more  than  a 
reasonable  net  profit  on  its  capital  invested. 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES.  587 

Rule  5  (as  amended  Nov.  1,  1918).  Profits  on  feeds. — The  licensee  shall  not  sell 
hominy  feed,  hominy  meal,  hominy  chop,  gluten  feed,  oil-cake  meal,  or  other 
feed  by-product  of  corn,  hominy  feed,  rye  feed,  or  oat  feed,  produced  as  a  by- 
product of  the  manufacture  of  corn,  barley,  rye,  or  oat  products  at  a  price  per 
pound  in  excess  of  the  purchase  price  per  pound  of  the  grain  from  which  it  is 
manufactured.  (Rule  issued  July  20,  1918,  applied  to  hominy  feed,  hominy 
meal,  hominy  chop,  barley  feed,  rye  feed,  or  oat  feed.  Nov.  1,  1918,  commodities 
added  as  noted  here.  Repealed  Dec.  17,  1918. ) 

Rule  8.  Package  differentials  on  corn  meal. — The  licensee  shall  not  sell  corn 
meal,  corn  grits,  hominy,  corn  flour,  barley  flour,  or  rye  flour,  except  on  the  basis 
of  the  following  differentials  : 

Package  differentials. — The  following  package  differentials  apply  to  all  sales  of  buck- 
whe'at  flour  : 

Basis  of  100  pounds  cotton  or  jute  lags. 

Cents  per 
100  pounds. 

50  pounds  cotton 1 over  basis__     10 

25  pounds  cotton do 20 

10  pounds  cotton do 50 

5  pounds   cotton - do 75 

50  pounds  paper under  basis 10 

25  pounds  paper do 5 

10  pounds  paper over  basis 15 

5  pounds  paper do 30 

3  pounds  paper do 45 

Extra  charge  for  burlapping,  baling,  or  double  sacking,  35  cents  per  100  pounds. 

(Rule  issued  May  22,  1918.  fixed  differentials  for  corn  meal,  corn  grits, 
hominy.  July  20,  1918,  corn,  barley,  and  rye  flour  added  and  differentials 
changed  as  noted  here.  Repealed  Dec.  17,  1918.) 

C,  SPECIAL  LICENSE  REGULATIONS  GOVERNING  LICENSEES  EN- 
GAGED IN  THE  BUSINESS  OF  MANUFACTURING  BUCKWHEAT 
PRODUCTS. 

(Effective  Nov.  15,  1918.) 

Rule  1.  Unreasonable  profits  prohibited. — The  licensee  shall  sell  buckwheat 
flour  at  not  more  than  a  reasonable  margin  over  the  average  cost  to  him  of 
the  buckwheat  from  which  such  flour  is  manufactured.  In  estimating  such 
average  cost  he  shall  include  all  grain  in  his  possession  or  under  his  control 
by  contract  or  other  arrangement,  but  he  shall  not  include  any  grain  which  he 
has  contracted  to  sell  or  the  products  of  which  he  has  contracted  to  sell; 
provided,  That  in  determining  the  cost  of  such  grain  he  shall  deduct  from  the 
average  purchase  price  the  proceeds  from  the  sale  of  feed  or  offal  created  in 
the  milling  operation ;  or  if  not  sold,  he  shall  deduct  its  current  market  value. 
Any  average  once  calculated  shall  be  taken  as  the  basis  for  such  averaged 
grain  in  all  subsequent  calculations. 

He  shall  keep  records  in  such  manner  as  to  show  how  all  averages  and  selling 
prices  have  been  determined.  (Repealed  Jan.  10,  1919.) 

NOTE. — The  Food  Administration  has  determined  that  the  sale  of  buckwheat  flour  at 
a  gross  margin  in  excess  of  $1.25  per  100  pounds  bulk  product  over  the  cost  of  the 
buckwheat  is  unreasonable  and  excessive  under  the  foregoing  rule.  These  margins  may 
therefore  be  regarded  as  maximum  margins,  but  they  do  not  in  any  way  abrogate  or 
modify  the  general  rule  that  profits  must  not  be  excessive. 

The  Food  Administration  will  further  consider  a  net  earning  of  more  than  10  per  cent 
on  the  first  $25,000  of  gross  sales  of  buckwheat  products  and  8  per  cent  on  all  gross 
sales  over  $25,000  as  prima  facie  evidence  of  a  violation  of  the  rule  which  prohibits 
the  taking  of  unreasonable  profits  (general  rule  5).  This  limitation  does  not  modify  or 
abrogate  the  general  principle  that  a  licensee  should  not  earn  more  than  a  reasonable 
net  profit  on  capital  invested. 

Differentials  on  less  than  car-lot  sales. — The  following  additional  margins  over  the 
$1.25  maximum  will  be  considered  reasonable  by  the  Food  Administration  on  less  than 
car-lot  sales,  but  this  does  not  modify  in  any  way  the  10  per  cent  and  8  per  cent 
limitation  of  net  profits.  The  additional  margin  should  be  calculated  on  car-lot  price  in 
sacks  : 


Less  than  car  lots  to  wholesalers  or  flour  mixers,  not  more  than  4  per  cent. 
(&)    Less  than   car   lots   to   bakers,   hotels,   or   retailers,   not  to  exceed   10   to   12  i   per 
cent  in  packages  of  25  pounds  or  over  ;  not  to  exceed  12  to  15  per  cent  in  packages  less 


than  25  pounds. 

(Only  one  of  the  three  foregoing  additional  margins  may  be  added  on.  any  lot.) 


588  HISTORY  or  PRICES  DURING  THE  WAR. 

V.  RICE. 

A.  SPECIAL  REGULATIONS  GOVERNING  DEALERS  IN  ROUGH  RICE. 

Rule  1.  Maximum  margin  over  cost  fixed. — The  licensee  shall  not  sell  rough 
rice,  except  for  seed,  at  an  advance  over  the  actual  purchase  price  of  the  par- 
ticular rice  sold  in  excess  of  1  per  cent  of  such  purchase  price  plus  the  storage 
charge,  insurance,  and  interest  on  the  investment  at  the  rate  of  6  per  cent  per 
annum.  (Issued  Nov.  1,  1917;  repealed  Jan.  10,  1919.) 

Rule  2  (as  amended  Oct.  31,  1918). 'Brokers  and  commission  merchants'  charges 
limited. — The  licensee  in  acting  as  a  broker  in  rough  rice,  or  in  receiving  rough 
rice  on  consignment,  shall  not  charge  a  commission  of  more  than  1  per  cent  for 
selling  such  rice  to  any  person  except  for  seed  purposes. 

If  the  licensee  performs  additional  services  these  shall  be  included  as  separate 
items  on  the  account  sales,  and  a  separate  charge  shall  be  made  therefor,  in  no 
case  to  exceed  an  additional  1£  per  cent.  (Issued  July  29,  1918;  amended  Oct. 
31,  1918;  repealed  Jan.  10,  1919.) 

Rule  3.  Resales  prohibited. — The  licensee  shall  not  sell  rough  rice,  except  for 
seed,  to  any  person  other  than  a  rice  miller.  (Issued  July  29,  1918;  repealed 
Jan.  6,  1919.) 

Rule  4.  Amount  of  rough  rice  under  control  limited  to  60  days'  supply. — The 
licensee  shall  not  keep  on  hand  or  have  in  possession  or  under  control  by  con- 
tract or  other  arrangement  any  rough  rice,  except  for  seed  purposes,  in  a  quan- 
tity in  excess  of  his  reasonable  requirements  during  the  period  of  60  days. 
(Issued  Nov.  1,  1917,  as  to  "  any  food  commodities  " ;  repealed  Jan.  6,  1919.) 

Rule  5.  Contracts  must  provide  for  shipment  within  60  days. — The  licensee 
shall  not  make  any  contract  for  rough  rice  for  delivery  more  than  60  days  after 
the  making  of  the  contract,  except  for  seed.  (Issued  Nov.  1,  1917,  as  to  "any 
food  commodities  " ;  repealed  Jan.  6,  1919. ) 

B.    SPECIAL  REGULATIONS   GOVERNING   RICE  MILLERS  AND  MANU- 
FACTURERS  OF   RICE   FLOUR. 

Rule  3.  Clean  rice  not  to  be  sold  at  more  than  reasonable  advance  over  cost. — 
Any  licensee  engaged  in  the  business  of  milling  rice  shall  sell  cleaned  rice  at 
not  more  than  a  reasonable  advance  over  the  cost  of  such  rice  without  regard 
to  the  market  or  replacement  value  at  the  time  of  sale.  ( Issued  Nov.  1,  1917 ; 
repealed  June  16,  1919.) 

NOTE. — Brokers'  commissions. — Brokers  will  be  considered  by  the  Food  Administration 
as  making  an  unreasonable  and  exorbitant  charge  for  negotiating  the  sale  of  rice  or 
rice  products  in  any  case  where  the  brokerage  exceeds — 

(a)  Seven  cents  per  100  pounds  on  carload  orders,  except  brewer's  rice,  sold  in  the 
following  cities  :  New  York  ;  San  Francisco  ;  Charleston  ;  Savannah  ;  Jacksonville,  Fla. ; 
St.  Louis  ;  Chicago  ;  Kansas  City,  Mo.  ;  Galveston  and  Houston,  Tex. 

(6)  Six  cents  per  100  pounds  on  any  quantity  of  rice,  except  brewer's  rice,  sold  in  New 
Orleans. 

(o)  Eight  cents  per  100  pounds  for  carload  orders,  except  brewer's  rice,  sold  at  any 
othei  point  except  those  designated  in  (a)  and  (&). 

(d)  Six  cents  per  100  pounds  on  brewer's  rice  sold  at  any  point  and  in  any  quantity. 

(e)  Twenty-five  cents  per  ton   on   rice   bran  or  rice  polish  at  any   point  and  in  any 
quantity. 

(/)    Six  cents  per  100  pounds  on  rice  flour  sold  at  any  point  and  in  any  quantity. 

Rule  7.  Maximum  margins  governing  manufacturers  of  rice  flour. — The 
licensee  shall  not  sell  ri^e  flour  at  an  advance  of  more  than  75  cents  per  10(? 
pounds  over  the  purchase  price  of  brewer's  rice  or  screenings  delivered  at  the 
mill.  (Issued  July  29,  1918;  repealed  June  16,  1919.) 

VI.  SUGAR. 

A.  SPECIAL  REGULATIONS  APPLYING  TO  ALL  MANUFACTURERS  AND 
REFINERS  OF  CANE  SUGAR  AND  BEET  SUGAR. 

Rule  3.  Prices  shall  conform  to  price  list  furnished. — The  manufacturer  shall 
furnish  to  the  United  States  Food  Administrator,  Washington,  D.  C.,  and 
deliver  to  the  trade  a  price  list  showing  his  selling  price  and  all  selling  terms 
and  differentials  in  force.  After  such  price  list  or  any  subsequent  price  list  is 
issued  the  manufacturer  shall  make  no  sales  of  suger  except  at  the  price,  dif- 
ferentials, and. terms  shown  in  the  price  list  then  in  force  until  he  has  mailed  to 
the  United  States  Food  Administrator  a  new  price  list  showing  any  change  made 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  589 

in  said  price,  differentials,  or  terms  and  has  received  the  written  approval  of 
the  United  States  Food  Administrator  to  any  change  in  differentials  and  to  any 
addition  to  the  list  of  new  types  of  sugar  or  styles  of  packages:  Provided,  That 
every  price  list  and  contract  to  sell  sugar  shall  include  a  stipulation  that  in 
case  a  change  in  the  United  States  Food  Administration  regulations  authorizes 
a  higher  price  than  that  named  in  the  contract  or  price  list  before  the  arrival 
of  the  sugar  .at  destination,  the  refiner  shall  have  the  right  to  raise  his  price 
to  such  higher  price,  and  that  in  case  such  change  requires  sales  at  a  lower 
price  than  that  named  in  the  price  list  or  contract  before  the  arrival  of  the 
sugar  at  destination,  the  refiner  shall  be  required  to  reduce  his  price  to  such 
lower  price.  (Issued  Oct.  1, 1917 ;  added  to  July  1,  1918 ;  repealed  Jan.  26, 1919.) 

NOTE. — The  issuance  of  price  lists  by  manufacturers  of  beet  sugar  will  not  be  necessary 
until  August  1,  1918,  and  after  that  date  it  will  be  dispensed  with  in  cases  in  which 
{he  manufacturer  shall  have  entered  into  a  proposed  voluntary  agreement  with  the 
United  States  Food  Administrator  prescribing  other  methods  of  supplying  such  infor- 
mation. 

Rule  4.  Maximum  brokerage  fixed. — The  manufacturer  shall  not  pay  any 
broker  commissions  in  excess  of  one-fourth  of  1  per  cent  on  the  value  of  raw 
sugar  bought,  or  in  the  case  of  refined  or  semirefined  sugar  sold  in  excess  of  5 
cents  per  hundred  pounds,  excepting,  however  that  a  higher  commission  may 
be  paid  for  any  special  service  if  first  approved  by  the  United  States  Food  Ad- 
ministrator. (Rules  issued  Oct.  1,  1917;  limited  brokerage  on  beet  sugar  to  5 
cents  per  100  pounds  cane  sugar  as  noted  here.  Combined  June  15,  1918,  as 
noted  here;  repealed  Jan.  26,  1919.) 

Rule  5.  Double  brokerage  prohibited. — The  manufacturer  shall  not  allow  or 
pay  to  any  person  any  brokerage  or  commission  on  sugar  or  its  by-products  on 
which  he  knows  a  commission  or  brokerage  to  have  already  been  paid.  (Issued 
Oct.  1,  1917;  repealed  Jan.  26,  1919.) 

B.  SPECIAL  REGULATIONS  APPLYING  TO  REFINERS  OF  CANE  SUGAR. 

Rule  2.  Sugar  to  be  sold  at  reasonable  advance  over  cost. — The  manufacturer 
shall  sell  his  sugar  at  not  more  than  a  fair  and  reasonable  advance  over  cost. 
(Issued  Oct.  1,  1917;  repealed  Jan.  26,  1919.) 

NOTE. — The  United  States  Food  Administration  will  announce  from  time  to  time  what 
advance  it  considers  fair. 

Rule  3.  Price  of  sirups  and  molasses. — The  licensee  shall  not  sell  the  follow- 
ing products,  when  manufactured  from  imported  raw  cane  sugar,  at  prices  to 
exceed  those  named  below,  which  are  based  on  the  cost  of  imported  raw  sugar 
to  the  refiner.  (Issued  June  15,  1918 ;  repealed  Jan.  26,  1919.) 


Per  gallon, 
in  barrels. 

Per  gallon. 
in  bulk. 

Refiner's  sirups  highest  grade  (fancy  filtered). 

Cents. 
55 
40 
30 
23 

Cents. 
50 
35 

25 

18 

Refiner's  sirups,  medium  grade  (filtered)        

Refiner's  sirups  low  grade  (unflltered) 

Blackstrap  molasses    .                    .  .         

The  prices  named  are  f.  o.  b.  cars  at  primary  markets  or  port  of  entry,  for 
point  of  production  if  carrying  same  freight  rate  as  from  primary  markets, 
net  cash  in  10  days  without  discount,  and  shall  include  brokerage  and  any  profit 
taken  by  a  distributor  in  tank  cars  direct  from  the  refinery,  but  shall  not 
include  freight  or  tank-car  charges. 

NOTE. — Any  questions  in  regard  to  the  grading  of  fancy,  medium,  and  low-grade  sirups 
will  be  determined  by  the  United  States  Food  Administration  committee  on  sirup 
valuations. 

Preference  to  domestic  orders  for  sirup. — The  Food  Administration  urgently  requests 
that  in  accepting  and  filling  orders  for  refiners'  sirups  preference  be  given  domestic 
customers  over  exporters.  If  this  is  not  done  voluntarily,  it  will  be  necessary  to  consider 
regulations  limiting  the  export  of  such  shipments. 


590  HISTORY   OF  PRICES   DURING  THE   WAR. 

C.  SPECIAL  REGULATIONS  APPLYING  TO  PRODUCERS  OF  BEET 

SUGAR. 

Rule  2.  Unreasonable  profit  prohibited. — The  manufacturer  shall  sell  beet 
sugar,  beet  molasses,  and  beet  pulp  at  not  more  than  a  fair  and  reasonable  ad- 
vance over  cost.  (Issued  June  15,  1918 ;  repealed  Jan.  26,  1919.) 

NOTE. — The  United  States  Food  Administration  will  announce  from  time  to  time  what 
advance  it  considers  fair.  Until  further  notice  any  sales  of  beet  sugar  at  a  price  in  excess 
of  the  selling  price,  at  the  same  time  and  place  of  standard  granulated  sugar  made  from 
cane  produced  in  the  United  States  (including  insular  territories),  will  be  considered  evi- 
dence of  a  violation  of  this  rule. 

Beet  molasses. — Until  further  notice  any  sales  of  beet  molasses  at  a  price  in  excess  of 
18  cents  a  gallon  in  bulk  or  23  cents  a  gallon  in  barrels,  f.  o.  b.  factory  net  cash  in  10 
days  without  discount  wil).  be  considered  evidence  of  a.  violation  of  this  rule.  This  price 
shall  include  brokerage  and  any  profit  taken  by  a  distributor  in  tank  cars  direct  from  fac- 
tory, but  shall  not  include  freight  or  tank-ear  charges. 

Beet  pulp. — The  Food  Administration  will  regard  any  sales  of  beet  pulp  at  prices 
greater  than  those  named  below  as  a  violation  of  the  above  rule  : 

Beet  pulp  wet  from  factory  or  from  silo  within  first  30  days  after  manufacture,  80 
cents  per  ton. 

Beet  pulp  out  of  silo  after  30  days  therein,  $1.25  per  ton. 

Dried  pulp  sacked,  f.  o.  b.  factory,  $40  per  ton. 

D.  SPECIAL  LICENSE  REGULATIONS  APPLYING  TO  MANUFACTURERS 
OF  REFINED,  SEMIREFINED,  AND  RAW  SUGAR  PRODUCED  FROM 
SUGAR  CANE  GROWN  ON  THE  MAINLAND  OF  THE  UNITED  STATES 
AND  SOLD  FOR  DIRECT  CONSUMPTION. 

Kule  2.  Unreasonable  profits  prohibited. — The  manufacturer  shall  sell  his 
sugar  at  not  more  than  a  fair  and  reasonable  advance  over  cost.  (Issued  July 
31,  1918;  added  to  Oct.  21,  1918;  repealed  Jan.  26,  1919.) 

NOTB. — The  United  States  Food  Administration  will  consider  as  a  violation  of  the 
above  rule  any  sale  of  direct  consumption  sugar  at  a  price  in  excess  of  $9  per  100 
pounds  f.  o.  b.  seaboard  points  or  points  of  production  carrying  the  same  freight  rate 
as  seaboard  points,  with  the  customary  discounts,  terms,  and  conditions,  less  the  following 
differentials : 

Plantation   granulated No  differential. 

White  clarified __10  cents  per  hundredweight 

Off   plantation    granulated 10  cents  per  hundredweight. 

Off  white : 15  cents  per  hundredweight. 

Choice  yellow  clarified 15  cents  per  hundredweight 

Prime  yellow  clarified 20  cents  per  hundredweight. 

Kettle 20  cents  per  hundredweight. 

Off  yellow  clarified 30  cents  per  hundredweight. 

Seconds  and  thirds   (first  group) 80  cents  per  hundredweight. 

Seconds  and  thirds   (second  group) 90  cents  per  hundredweight. 

Seconds  and  thirds   (third  group) $1  per  hundredweight. 

Seconds  and  thirds  (fourth  group) $1.10  per  hundredweight. 

Seconds  and  thirds   (fifth  group) $1.20  per  hundredweight. 

The  differential  on  all  grades  of  semirefined  direct-consumption  sugars  not  listed 
above  shall  be  the  differential  indicated  for  sugars  of  equal  grade  ;  or  if  of  an  inter- 
mediate grade,  at  the  differential  of  the  listed  grade  next  below  ;  and  the  differential 
on  sugars,  the  grade  and  price  of  which  can  not  be  thus  determined,  shall  be  fixed  by 
the  said  sugar  committee.  The  above  grades  shall  be  determined  with  reference  to  the 
standard  samples  thereof  as  fixed  by  the  New  Orleans  Sugar  and  Rice  Exchange,  with 
the  approval  of  the  United  States  Food  Administration,  and  now  on  file  with  said  ex- 
change. In  case  of  dispute  regarding  the  grade,  the  final  decision  shall  be  made  by  the 
Louisiana  sugar  committee.  The  Food  Administration  will  further  consider  as  a  viola- 
tion of  the  above  rule  any  sale  of  raw  sugar  at  a  price  delivered  at  customary  Louisiana 
refining  points  in  excess  of  $7.28  per  100  pounds  for  96°  test,  and  any  sale  of  washed 
sugar  (which  is  defined  as  any  first  sugar  above  the  grade  of  raw  sugar  and  below  the 
grade  of  off  yellow  clarified,  and  having  a  color  test  of  not  less  than  22  Dutch  standard) 
at  a  price  in  excess  of  $7.68  per  100  pounds,  with  an  addition  of  one-sixteenth  cent  per 
pound  for  every  degree  or  fraction  thereof  above  96°  and  a  reduction  of  one-tenth  cent 
per  pound  for  every  degree  or  fraction  thereof  below  96°. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  591 

VII.  CANNERS  OF  PEAS,  TOMATOES,  CORN,  DRIED  BEANS,  SAL- 
MON, SARDINES,  AND  TUNA,  AND  MANUFACTURERS  OF  TOMATO 
CATSUP,  TOMATO  SOUP,  AND  OTHER  TOMATO  PRODUCTS;  CON- 
DENSED,  EVAPORATED,  OR  POWDERED  MILK. 

A.  SPECIAL  REGULATIONS  GOVERNING  LICENSEES  ENGAGED  IN  THE 
•BUSINESS  OF  CANNING  PEAS,  CORN,  TOMATOES,  DRIED  BEANS, 
SALMON,  SARDINES,  OR  TUNA,  OR  MANUFACTURING  TOMATO 
SOUP,  TOMATO  CATSUP,  OR  OTHER  TOMATO  PRODUCTS. 

(The  following  special  rules  correspond  to  series  B,  and  in  so  far  as  they 
apply  to  the  canning  of  peas,  corn,  tomatoes,  dried  beans,  salmon,  or  sardines 
became  effective  Nov.  1,  1917,  unless  otherwise  noted.  They  became  effective 
as  to  tomato  catsup  and  other  tomato  products  other  than  canned  tomatoes  on 
Feb.  28,  1918.  They  became  effective  as  to  canned  tuna  on  June  15,  1918. ) 

Rule  2.  Manufactured  products  must  be  sold  at  not  more  than  reasonable  ad- 
vance over  average  cost. — The  licensee  shall  sell  goods  manufactured  and  on 
hand  for  not  more  than  a  reasonable  advance  over  the  average  cost  of  the  sea- 
sou's  pack,  without  regard  to  the  market  or  replacement  value  at  the  time  of 
such  sale.  ( Issued  Nov.  1, 1917,  providing  for  sale  at  "  not  more  than  reasonable 
advance  over  cost  of  such  goods";  changed  Jan.  28,  1918,  to  present  form; 
repealed  Jan.  10,  1919.) 

The  canned-goods  division,  under  date  of  September  7,  1918,  issued  the  fol- 
lowing announcement : 

TO    CANNERS  AND   DISTRIBUTORS   OF   LICENSED   CANNED   VEGETABLES. 

In  order  to  make  clear  the  attitude  of  the  Food  Administration  in  regard  to  the  rules 
and  regulations  governing  canners  and  distributors  of  licensed  canned  vegetables,  the 
following  announcement  is  made  in  regard  to  canned  corn,  canned  tomatoes,  and  canned 
peas: 

1.  Future  sales. — Before  invoicing  goods  which  were  sold  for  future  delivery,  canners 
have  been  instructed  to  review  their  estimate  of  cost,  and  if  it  is  determined  at  the  time 
of  shipment  that  the  actual  cost  is  lower  than  the  estimated  cost,  prices  must  be  revised 
by  the  canner  so  that  the  margin  of  profit  will  not  exceed  the  maximums  announced  as 
reasonable. 

2.  Revision  of  prices. — Revision  of  prices   must  occur  before  invoicing.      It  would  be 
impracticable  to  rebate  throughout  the  channels  of  distribution  in  order  to  give  the  con- 

1  sumer  the  benefit  of  lower  prices ;  therefore  the  canner's  invoice  price  is  the  final  price, 
and  no  revision  after  invoicing  will  be  permitted,  with  this  exception : ' 

If  the  direct  customer  of  a  canner  will  agree  to  accept  delivery  and  withhold  the  goods 
from  distribution,  the  canner  will  be  permitted  to  bill  at  the  time  of  shipment  at  the 
future  contract  price,  pending  the  final  determination  of  his  cost  at  the  end  of  his  pack. 
In  this  case  the  purchaser  must  make  payment  on  the  basis  of  this  invoice  and  in  accord- 
ance with  its  terms  permitting  the  canner  to  make  final  adjustment,,  if  any,  in  the  form 
of  a  rebate.  The  purchaser  must  in  such  cases  await  the  canner's  final  price  before 
invoicing  these  goods. 

3.  Spot  sales. — Canners  who  have  made  delivery  in  good  faith  at  future  contract  prices 
and   later   find   their   costs   are   lower   than  anticipated   must   sell   the   balance   of  their 
pack  at  such  prices  as  to  insure  their  making  no  more  than  the  maximum  margins  on  the 
entire  season's  output.     In  these  cases  purchasers  who  have  already  received  shipments  at 
the  contract  price  must  be  given  the  opportunity  of  purchasing  such  surplus  at  the  lower 
price.     This  surplus  must  be  offered  to  such  purchasers  pro  rata  up  to  a  quantity  equal 
to  their  future  purchases. 


592  HISTOKY   OF   PRICES   DURING   THE   WAR. 

The  canned  foods  and  distribution  division  issued  the  following  announcement, 
under  date  of  October  22,  1918 : 

TO  CANNERS  AND  DISTRIBUTORS  OF  LICENSED  CANNED  VEGETABLES. 
(Statement  supplementing  announcement  of  Sept.  9,  1918 — Revision  of  contract  prices.) 

As  many  inquiries  have  been  received  with  reference  to  the  proper  construction  of  the 
announcement  made  September  9,  1918,  as  to  the  revision  of  contract  prices  of  canned 
corn,  canned  tomatoes,  and  canned  peas,  it  is  deemed  advisable-  to  make  the  following 
general  statement : 

Where  the  packer's  profits  prove  to  be  greater  than  those  permitted  by  the  rules  of  the 
Food  Administration,  he  shall  remit  the  excess  to  the  purchaser,  who  shall  credit  the 
amount  received  by  him  upon  the  average  cost  of  goods  of  the  same  grade  and  size  of  the 
same  commodity  then  in  his  possession  or  invoiced  to  him. 

Attention  is  called  to  the  fact  that  the  rules  permit,  but  do  not  require,  that  goods  of 
different  brands  be  averaged.  In  a  spirit  of  fairness  to  the  packer,  therefore,  the  pur- 
chaser should  apply  the  reduction  in  cost  first  to  goods  then  in  his  possession  under 
packers's  label,  up  to  an  amount  in  cents  per  dozen  equal  to  the  rebate,  before  applying 
the  reduction  in  cost  to  goods  under  other  labels. 

If  the  purchaser's  stock  of  such  goods  is  so  small  as  to  make  this  impracticable  or  the 
price  ridiculous,  he  shall  apply  to  the  wholesale  section  of  the  Food  Administration  for 
instructions. 

The  packer  shall  make  to  the  canned  foods  division  of  the  Food  Administration  a  state- 
ment giving  the  names  of  the  purchasers  to  whom  such  payments  are  made,  the  amount 
of  each  payment,  and  stating  the  grade  and  size  of  the  canned  goods  on  account  of  which 
each  payment  is  made. 

The  purchaser  shall  also  make  a  written  statement  to  the  wholesale  section  of  the  Food 
Administration  showing  the  amounts  so  received,  from  whom  received,  and  how  the  same 
were  credited. 

The  wholesaler  will  not  be  permitted  to  make  any  rebate  to  the  retailer  on  the  price 
of  any  goods  already  delivered  to  the  retailer. 

In  this  connection  attention  is  called  to  the  fact  that  the  wholesaler  can  not  sell  at  a 
price  which  will  enable  him  to  realize  more'  than  the  prescribed  margin  of  profit  over  the 
average  cost,  reduced  as  above  provided  for.  The  average  cost  is  to  be  determined  in  the 
manner  required  by  the  rules  and  regulations. 

(Rules  6  to  11  apply  to  the  canning  of  fresh  vegetables  and  fish  only.) 
Rule  6.  Quotations  or  sales  before  February  1  prohibited. — The  licensee  shall 
not  quote  for  future  packing  or  delivery  or  sell  any  canned  peas,  canned  corn, 
canned  tomatoes,  tomato  soup,  tomato  catsup,  or  other  tomato  products,  canned 
salmon,  canned  sardines,  or  canned  tuna  before  February  1  of  the  year  in  which 
such  products  are  to  be  canned  :  Provided,  That  this  rule  shall  not  apply  to  sales 
to  the  Government  of  the  United  States.  (Issued  Nov.  1,  1917 ;  repealed  Jan.  10, 
1919.) 

NOTE. — This  rule  corresponds  to  special  rule  1,  series  B,  governing  canners.  It  was 
amended  to  its  present  form  January  28,  1918.  "  Shall  not  quote  for  future  packing  or 
delivery  or  sell  "  includes  acceptance  of  orders  subject  to  approval  of  price  when  named. 
This  rule  prohibits. the  acceptance  of  conditional  orders  or  commitments  of  every  kind. 

Rule  9.  Licensee  must  not  buy  commodities  already  sold. — No  licensee  shall 
buy  or  contract  to  buy  any  of  the  vegetables  or  fish  required  for  the  above- 
mentioned  products  if  he  has  reason  to  believe  that  the  seller  has  already  con- 
tracted to  sell  the  said  materials  to  other  persons.  In  buying  vegetables  or  fish 
for  such  products  he  shall  require  the  seller  to  state  in  writing,  in  the  contract  or 
otherwise,  that  he  has  not  contracted  to  sell  said  vegetables  or  fish  to  others. 
(Issued  Nov.  1,  1917;  repealed  Dec.  3,  1918.) 

NOTE. — This  rule  corresponds  to  special  rule  5,  series  B,  governing  canners. 

The  canned  goods  division  issued  the  following  announcement  on  November  1, 
1918: 

The  Food  Administration  has  been  able  to  arrange  for  a  sufficient  quantity 
of  tin  plate  to  permit  the  packing  of  beans.  Permission  is  herewith  granted  to 
canners  of  beans  to  pack  during  the  months  of  November,  December,  and 
January  a  total  quantity  not  in  excess  of  a  normal  pack  for  these  three  months. 
Canners  may  use  up  all  odd-sized  tins  now  on  hand,  but  additional  purchases 
of  tins  smaller  than  No.  2  size  will  not  be  permitted.  It  is  still  necessary  for 
all  shippers  selling  beans  to  canners  to  secure  permits  before  making  sales. 
Canners  may  not,  however,  contract  for  more  than  a  three  months'  supply  of 
cans  or  beans. 


GOVERNMENT  REGULATIONS   RELATING  TO   PRICES. 
ESTABLISHED    PRICES— CANNED    GOODS    DIVISION. 


593 


The   canned   goods   division   has  prepared   the  following,   which   shows  what  has  been 
done  in  establishing  prices  on  commodities' under  its  supervision  : 

CANNED    SALMON. 

Conferences  were  held  with  the  State  food  administrators  and  fishermen  on  the  coast 
and  maximum  prices  were  adopted  which  were  as  follows  : 

RAW    FISH. 


Alaska  section. 

Kings 
(each). 

Reds 
(per  fish). 

Cohoes 
(each). 

Dogs 
(each). 

Pinks 

(each). 

Bristol  Bay 

$0  40 

$0.07 

SO.  07 

$0.04 

$0.  02 

Hcrendeen  Bay                .             

25 

.12* 

.121 

.08 

.04 

Central  Alaska 

50 

.12 

.12 

.05 

.04 

Yukutat: 

40 

Under  15  pounds 

15 

.12 

.12 

•  OH 

Southeast  \laska 

i  09 

.32 

.32 

.09 

.06 

Per  pound. 


Oregon  : 

Columbia  River — 
Chums   _ 


Chinooks__. 

Then    

Silversides 
Steelheads 
Rogue  River — 
All  grades 
Chinooks  _ 


Cents. 
J1  3J 

0! 


=r 


Washington  coast  streams. 

Prices  per  pound. 

Chinooks. 

Cohoes. 

Chums. 

Cents. 
6* 

9 
1 

Cents. 
6i 
<H 
5? 

i 

1 

toco  co  co  co  ' 

Willapa  Harbor 

Toholas  

Quccts  River 

After  reaching  a  basis  for  maximum  prices  to  be  paid  to  the  fishermen,  a  committeee 
consisting  of  three  State  food  administrators,  Mr.  Deming,  who  represented  the  division 
of  coordination  of  purchase,  and  Mr.  Warren,  who  represented  the  canned  foods  division, 
Investigated  packing  costs  in  Alaska  and  the  following  maximum  prices  on  the  different 
grades  were  established. 

CANNED   SALMON. 


Alaska  salmon. 

No.  1 
tails  (per 
dozen). 

No.  1 
flats  (per 
dozen). 

Halve  > 
flat  (per 
dozen). 

Reds                                                               

$2.35 

$2.50 

$1.65 

2.25 

2.40 

1.65 

Pinks                                                 

1.65 

1.80 

1.10 

Chums                                                                     

1.60 

1.75 

1.10 

*To  Sept.   10. 

2  To   Sept.   20. 

3  80  cents  per  box  to  be  paid  for  hauling  to  Noclips,  including  return  of  empty  boxes. 

125547°— 20 38 


594 


HISTORY   OF  PRICES   DURING  THE   WAR. 


Since  the  Alaska  prices  were  established  the  following  maximum  prices  have  been  estab- 
lished for  salmon  caught  in  Oregon  waters  and  salmon  caught  in  Washington  waters  : 

COLUMBIA    RIVER    AND    ORECfON    COAST    STREAMS. 


No.  1 

No.  1 

Halves 

tails  (per 

flats  (per 

(per 

dozen). 

dozen). 

dozen). 

Fancy  spring  chinooks  .                    

$3.15 
2.75 

$3.25 

2.85 

$2.00 
1.75 

Standard  spring  and  No.  1  fall  chinooks                                           .       ... 

Blue  backs 

2.00 

No.  2  fall  chinooks  

2.30 

2.40 

1.50 

Silver  sides 

2.40 

2.50 

1.60 

No  3  chinooks  and  chums 

1.75 

1.85 

1.10 

PUGET  SOUND    AND    WASHINGTON    COAST  STREAMS. 


1 

Tails 
(per 
dozen). 

Flats 
(per 
dozen). 

Halves 
(per 
dozen). 

Fancy  springs  or  chinooks 

$3.15 

$3.25 

$2.00 

Standard  springs  or  chinooks  .  .                                                       '  

2.75 

2.85 

1.75 

Cohoes 

2.40 

2.50 

1.60 

Chums  ...                                                                    

1.75 

1.85 

1.10 

CANNED    SARDINES. 

Eastern. — The  Maine  State  food  administrator  early  in  this  year  called  a  conference  of 
the  fishermen  heavily  interested,  and  a  price  of  $25  per  hogshead  for  raw  fish  was  estab- 
lished as  the  maximum  price  to  be  paid  by  the  packers. 

A  little  later  a  committee  representing  a  very  large  proportion  of  the  Maine  sardine 
packers  appeared  before  Mr.  Munn  and  a  voluntary  maximum  price  was  established  of 
$6.50  per  case  for  one-quarter  oil  canned  sardine.  Later  the  Canadian  authorities  adopted 
the  American  prices  as  maximum. 

Western. — The  sardine  situation  has  recently  been  handled  in  California  by  Mr.  Munn 
in  conferences  held  with  the  fishermen  and  packers,  and  the  basis  is  as  follows  : 

Maximum  prices  for  raw  sardines  :  Per  ton. 

Under   7J   inches $30 

Over   7|    inches 15 

Based  on  these  raw-fish  prices,  the  following  maximum  canned  sardine  prices  were 
approved  : 


Tomato 
(per 
case). 

Oil  (per 
case). 

Quarter  round  

$3.25 

$3.  35 

One-half  round 

4.00 

4.15 

Ones  round  

5.75 

6.00 

7  25 

One-half  oval 

5.50 

CANNED  TUNA. 

The  tuna  situation  was  handled  by  conferences  with  the  fishermen  at  which  the  maxi- 
mum prices  for  raw  tuna  were  established  as  follows  :  % 

One  hundred  and  ten  dollars  per  ton  for  Albacore  and  blue-fin  tuna,  and  $100  per  ton. 
for  all  other  tuna. 

Later  the  canners  were  gotten  together  and  the  prices  on  canned  tuna  were  established 
as  follows  : 

Per  doz. 

48/1's , $3.  37$ 

48/i's J 1.90 

48/1's 1.25 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES.  595 

CANNED    CORN,,    PEAS,    AND    TOMATOES. 

It  has  been  impossible  to  reach  the  grower.  The  canner,  however,  has  been  on  the 
basis  of  maximum  margins  of  profit  as  announced  in  Bulletin  No.  38,  issued  by  the  canned 
goods  division  on  Mny  1,  191S,  which  reads  as  follows: 

Based  on  the  views  of  the  Federal  Trade  Commission  of  reasonable  profit  and  the 
Food  Administration's  valuation  of  reasonable  crop  hazard  insurance,  the  following 
maximum  margins  in  cents  per  dozen  cans  are  announced  for  licensed  eanners  between 
cost  and  selling  price.  Excess  of  these  margins  will  be  considered  unreasonable  under  the 
food-control  act. 

Cost  shall  not  include  income  and  excess  profits  taxes,  interest  on  investment,  interest 
on  long-term  notes,  or  crop  hazards. 
Corn  (per  dozen  cans)  :  Cents. 

No.    2,    standard 19 

No.   2,  extra  standard 22 

No.   2,    fancy 30 

Peas  (per  dozen  cans)  : 

No.  2,  substandard   (average  all  sizes) 15 

No.  2,  standard   (average  all  sizes) 22 

No.  2,  fancy  (average  all  sizes) 31 

NOTE. — Greater  margins  on  smaller  sizes  of  peas,  offsetting  less  margins  on  larger 
sizes,  will  be  allowed,  provided  the  average  does  not  exceed  margin  announced. 

Tomatoes    (per  dozen  cans)  :  Cents. 

No.  2,  standard 18 

No.  2J,  standard 22 

No.  3,  standard _L 27 

No.    3,    fancy 31 

No.    10,    standard 90 

No.  10,  fancy , 100 

NOTE. — From  the  margins  on  standard  tomatoes  a  deduction  of  5  cents  per  dozen  on 
Nos.  2,  2i,  3,  and  of  15  cents  per  dozen  on  No.  10  shall  be  made  for  the  substandard  grade. 

While  profits  shall  be  reasonable,  the  Food  Administration  adopts  the  general  principle, 
applicable  to  all  important  producing  agencies,  that  profits  must  be  sufficient  to  encourage 
production. 

These  margins  are  believed  to  be  ample  to  provide  a  fair  stimulative  profit  to  the  ean- 
ners, with  due  consideration  to  labor  difficulties,  crop  hazards,  and  the  peculiar  uncer- 
tainties incident  to  this  industry. 

We  emphasize  the  fact  that  the  margins  are  maximum  margins  and  must  be  considered 
as  euides  only.  They  do  not  change  the  rules. 

This  industry,  like  all  others  subject  to  license,  should  be  guided  by  the  general  prin- 
ciple that  what  would  have  been  a  satisfactory  profit  in  the  prewar  period  on  an  even 
market,  under  freely  competitive  conditions,  should  be  the  standard  to-day,  and  no 
maximum  named  as  a  guide  should  be  accepted  as  an  invitation  to  exceed  this  former 
standard. 

The  practice  of  selling  the  pack,  or  a  large  proportion  of  it,  in  advance  of  its  produc- 
tion is  an  outgrowth  of  conditions  existing  in  this  industry.  It  is  a  safeguard,  both  for 
farmers  and  for  eanners,  and  the  practice,  properly  conducted  in  accordance  with  the 
rules  and  regulations  of  the  Food  Administration,  tends  strongly  to  remove  the  dangerous 
speculative  features  otherwise  incident  to  the  business. 

B.  SPECIAL  REGULATIONS  GOVERNING  LICENSEES  ENGAGED  IN  THE 
BUSINESS  OF  MANUFACTURING  CONDENSED,  EVAPORATED,  OR 
POWDERED  MILK. 

Rule  2.  Goods  must  be  sold  for  not  more  than  reasonable  advance  over  average 
cost. — The  licensee  shall  sell  condensed,  evaporated,  and  powdered  milk  for  not 
more  than  a  reasonable  advance  over  the  average  cost  of  the  season's  pack 
without  regard  to  the  market  or  replacement  value  at  the  time  of  such  sale. 
(Issued  Nov.  1.  1917,  providing  for  sale  at  "  not  more  than  reasonable  advance 
over  cost  of  such  goods."  Changed  to  present  form  Jan.  28,.  1918 ;  repealed  Jan. 
10,  1919.) 

VIII.  SPECIAL  REGULATIONS  GOVERNING  LICENSEES  ENGAGED 
IN  THE  BUSINESS  OF  PREPARING  OR  PACKING  DRIED  PEACHES, 
DRIED  APPLES,  DRIED  PRUNES,  OR  DRIED  RAISINS. 

Rule  2.  New-crop  fruits  not  to  be  bought  or  sold  before  July  15. — The 
licensee,  prior  to  July  15  of  the  year  in  which  new-crop  fruits  are  to  be  grown 
and  packed  shall  not  buy,  contract  to  buy,  offer  for  sale,  or  have  outstanding  any 
contract  of  sale  or  any  commitment  for  sale  of  new-crop  fruits  not  available  for 
spot  delivery.  A  commitment  shall  include  all  tentative  or  conditional  orders 


596  HISTORY   OF   PRICES   DURING   THE   WAR. 

whether  definite  prices  are  named  or  not.  (Rule  issued  Mar.  30,  1918,  forbade 
sales  before  May  1.  Changed  to  June  1  on  Apr.  30,  1918;  changed  to  July  15 
on  May  24,  1918;  repealed  Jan.  10,  1919.) 

Rule  4.  Dried  fruits  must  be  sold  at  not  more  than  a  reasonable  advance  over 
cost. — The  licensee  shall  sell  his  products  for  not  more  than  a  reasonable  ad- 
vance over  the  cost  of  said  products  and  without  regard  to  market  or  replace- 
ment value  at  the  time  of  said  sale.  (Issued  Mar.  30,  1918;  repealed  Jan.  10, 
1919. ) 

DRIED  FRUITS. 

Rule  VIII-A-2. — The  canned  goods  and  dried  fruits  division  has  prepared 
the  following,  which  shows  what  has  been  done  in  establishing  prices  on  dried 
fruits.  The  dried  fruit  situation  has  been  handled  largely  by  Mr.  Merritt, 
State  food  administrator  for  California,  and  his  conferees.  In  each  instance 
a  large  majority  of  the  representative  growers  have  been  brought  together  and 
voluntary  agreements  have  been  reached  covering  the  maximum  prices.  The 
dried  fruit  packers  were  then  handled  in  the  same  way  and  adopted  a  maximum 
of  profit  of  4  per  cent. 

The  prices  for  dried  fruits  in  California  are  as  follows : 

PEACHES. 

Maximum  price  to  grower,  11  cents,  which  includes  8  per  cent  gain  in  dip  already 
agreed  upon. 

Maximum  price  to  trade. 

Cents. 

Choice  yellow,  bulk  basis 111 

Fancy  yellow,  bulk  basis 12J 

Choice  muir,  bulk  basis 111 

Fancy  muir,  bulk  basis 121 

(Add  1  cent  per  pound  for  50's  and  1J  cents  for  25's.) 

RAISINS. 

Huijiti;/  j>rk-c  to  f/roira: 

Cents. 
Muscat ' 5J 

Selling  price  to  trade. 

Fancy   seeded $0.0962 

Choice  seeded ,  09125 

Bulk    seeded J .  08 

Loose  2  crown x .  075 

Loose  3  crown x  .  08 

PRUNES. 

Cents. 

40-50  bulk  basis 10 

50-60  bulk  basis 9 

70-80  bulk  basis L__  81 

The  Oregon  situation  was  handled  by  Mr.  Ayer.  The  Oregon  prices  on  prunes  are  as 
follows  : 

Cents. 

40-50  bulk  basis 10 

50-60  bulk  basis ,. 9 

60-70  bulk  basis 9 

70-80  bulk  basis 8| 

DRIED    APPLES. 

While  dried  apples  are  licensed,  it  has.  been  found  impossible  to  reach  any  general  vol- 
untary agreement  with  the  growers  owing  to  the  peculiar  production  feature,  in  that  they 
are  produced  practically  everywhere.  We  are,  however,  attempting  to  regulate  the  prof- 
its of  packers  on  the  4  per  cent  maximum  basis. 

1  Per  Ib.  in  25-lb.  boxes. 


GOVERNMENT  REGULATIONS  RELATING   TO   PRICES.  597 

Rule  VIII-A-2  is  not  to  be  construed  as  prohibiting  the  making  of  a  contract  whereby 
a  packer  or  association  agrees  with  a  grower  to  market  the  grower's  crop  at  the  price  pre- 
vailing when  the  crop  is  marketed  ;  nor  is  the  rule  to  be  construed  as  affecting  any  such 
contracts  that  are  already  outstanding.  (Opinion  A-106,  July  22,  1918.) 

Rule  5.  Price  lists  and  circulars  to  be  mailed  Food  Administration. — Licensees 
quoting  dried  fruits  for  shipment  in  carload  lots  shall  mail  promptly  to  the 
dried-fruit  division  of  the  United  States  Pood  Administration,  Washington,  D.  C., 
all  price  lists  and  circulars  relating  to  prices  on  dried  peaches,  apples,  prunes, 
or  raisins.  (Issued  Mar.  30,  1918;  repealed  Dec.  3,  1918.) 

NOTE. — Rules  2,  3,  4,  and  5  correspond  to  special  rules  1,  2,  3,  and  4,  series  B,  supple- 
ment 16,  effective  March  30,  1918.  Rules  4  and  5  were  amended  to  their  present  form 
May  24,  1918. 

IX.  DEALERS   AND   BROKERS   IN,   AND    IMPORTERS   OF   CERTAIN 
VEGETABLE  OILS  AND  THEIR  RAW  MATERIALS. 

A.  SPECIAL  REGULATIONS  GOVERNING  LICENSEES  DEALING  IN  COT- 
TON SEED  AND  PEANUTS,  BROKERS  IN  SUCH  COMMODITIES,  AND 
COTTON  GINNERS. 

Rule  3.  Licensee  must  not  pay  higher  prices  for  cotton  seed  *  or  peanuts  2  in 
one  market  than  in  another. — No  licensee  shall  pay  or  offer  to  pay  higher  prices 
for  cotton  seed  or  peanuts  in  one  market  than  he  pays  or  offers  to  pay  for  cotton 
seed  or  peanuts  of  the  same  quality  in  any  other  market:  Provided,  however, 
That  when  zones  are  established  as  mentioned  in  the  note  to  Rule  B-8,  he  may 
pay  varying  prices  in  the  several  zones,  but  must  pay  the  same  price  at  all 
points  in  the  same  zone  on  the  same  day  for  cotton  seed  or  peanuts  of  the  same 
quality.  (Issued  July  1,  1918.) 

Rule  5.  Cotton  seed1  or  peanuts2  to  be  sold  at  not  more  than  reasonable 
advance  over  cost. — The  licensee  shall  sell  cotton  seed  and  peanuts  at  not  more 
than  a  reasonable  advance  over  the  actual  cost  to  him  of  the  particular  cotton 
seed  or  peanuts,  sold  without  regard  to  the  market  or  replacement  value  at  the 
time  of  sale.  (Issued  Nov.  1,  1917,  making  exception  for  licensees  who  could 
not  keep  separate  the  purchase  and  manufacturing  costs  of  particular  com- 
modities, and  forbidding  averaging  costs,  etc.,  of  separate  mills  operated  by  a 
licensee.) 

NOTE. — Effective  July  1,  1918,  and  until  further  notice  the  United  States  Food  Ad- 
ministration will  regard  any  sale  of  cotton  seed  at  advances  greater  than  those  indicated 
below  over  the  prices  paid  for  such  cotton  seed  as  a  violation  of  the  above  rule  : 

(1)  Purchase   and    sale    of    cotton    seed    where    the    licensee    provides    the    necessary 
facilities  and   capital,   and   bears  the   expenses  and   risks   incident  to   the   business,    $3 
per  ton  (including  delivery  and  loading  of  seed  into  cars  at  mills). 

(2)  Purchase  and   sale  of  cotton   seed  where   the  licensee   operates  as  principal   but 
his  capital  is  furnished  by  another,  and  his  expenses  and  business  risks  and  facilities, 
in   whole   or   in   part,   are   borne   by  another,   or   where   the   licensee    operates   as   agent 
under  his  own  license  or  under  the  license  of  another,  $1.50  for  each  ton  of  cotton  seed 
negotiated  by  him.     The  remainder  of  the  margin  as  provided  for  in  paragraph  1  shall 
be  retained  by  the  party  or  parties  furnishing  the  capital   and  facilities  and  assuming 
the  risks  and  expenses,  in  whole  or  in  part. 

(3)  Any  margin  or  commission  in  excess  of  25  cents  per  ton  to  a  licensee  operating 
either  as  broker  or  as  dealer  who  buys  and  sells  cotton  seed  in  car  lots  will  be  regarded 
as  unreasonable.     Any  commission  must  be  paid  by  either  the  seller  or  final  buyer  out  of 
his  spread  or  margin,  and  if  any  dealer  in  car  lots  takes  a  margin  for  such  handling  the 
person  who  buys  from  him  shall  deduct  such  margin  from  his  own  permissible  spread  or 
margin  unless  it  has  already  been  deducted  by  the  original  seller. 

Rule  8.  Unreasonable  charges  by  ginners  prohibited. — No  licensee  owning, 
controlling,  or  operating  a  ginnery  shall  make  any  unreasonable  charge  for  the 
service  of  cleaning  seed  cotton  or  separating  the  seed  from  the  lint.  (Issued 
Nov.  1,  1917 ;  repealed  May  31,  1919.) 

NOTE. — The  United  States  Food  Administration  may  determine  and  announce  a  maxi- 
mum charge  that  may  be  made  by  licensees  for  performing  the  service  known  as  ginning. 

Ginners  shall  keep  a  correct  record  showing  the  name  and  address  of  each  party  for 
whom  they  gin  cotton,  the  amount  of  cotton  ginned  in  each  case,  and  the  actual  charge 
made  for  each  service.  They  must  also  keep  a  careful  record  showing  the  name  and 
address  of  each  party  from  whom  they  purchased  cotton  seed,  together  with  the  quantity 
and  price  paid  for  the  same.  They  must  at  all  times  be  prepared  to  furnish  detailed  in- 
formation to  the  United  States  Food  Administration. 

1  Repealed  May  31,  1919.  2  Repealed  Nov.  13,  1918. 


598  HISTORY  OF  PRICES  DURING  THE  WAR. 

The  charge  for  ginning  should  be  the  same  whether  or  not  the  cotton  or  the  cotton 
seed  is  purchased  by  the  ginner. 

Ginners  should  gin  as  rapidly  as  possible  consistent  with  good  work  all  dry  seed  cotton 
tendered  them,  and  upon  demand  they  should  return  to  the  owner  the  cotton  and  cotton 
seed  ginned  by  them.  If  cotton  seed  is  purchased  by  the  ginner,  he  becomes  a  dealer 
therein,  and  must  be  guided  by  the  margins  indicated  under  Rule  5,  above. 

Kule  9.  Maximum  buying  margin  below  carload  market  price  prescribed. — A 
licensee  who  buys  cotton  seed  in  less  than  carload  quantities  for  sale  or  ship- 
ment in  carload  quantities  shall  buy  at  a  gross  margin  below  the  carload  market 
price  at  railroad  points,  not  to  exceed  $3  per  ton.  The  cost  of  hauling  from 
distant  points  to  the  railroad  may  also  be  deducted.  (Rule  issued  Dec.  7,  1917, 
provided  "  No  licensee  shall  sell  any  cotton  seed  in  car  lots  at  more  than  $2  per 
ton,  exclusive  of  customary  loading  charge,  over  price  paid  for  said  cotton  seed." 
Rule  governing  1918  crop  issued  July  1, 1918,  given  here ;  repealed  May  31, 1919.) 

B.  SPECIAL  REGULATIONS  GOVERNING  LICENSEES  CRUSHING  COT- 
TON SEED,  PEANUTS,  SOYA  BEANS,  PALM  KERNELS,  OR  COPRA, 
AND  DEALERS  AND  BROKERS  IN  THE  RESULTING  OILS. 

Rule  8.  Commodities  must  be  sold  at  not  more  than  reasonable  advance  over 
cost. — The  licensee  shall  sell  the  products  of  cotton  seed,  peanuts,  and  soya 
beans  at  not  more  than  a  reasonable  advance  over  the  average  cost  to  the 
licensee  of  the  cotton  seed,  peanuts,  or  soya  beans  from  which  such  products  are 
manufactured.  A  licensee  who  operates  one  or  more  cotton  ginneries  or  crushing 
mills  shall  keep  separate  accounts  and  make  "reports  to  show  separately  the 
operations  of  each ;  for  the  purpose  of  this  rule  each  cotton  ginnery  or  crushing 
mill  shall  be  considered  as  a  unit  and  the  licensee  shall  not  be  permitted  to 
average  any  costs,  profits,  or,  losses  between  such  units. 

NOTE. — The  United  States  Food  Administration  will  divide  the  cotton-producing  terri- 
to/y  of  the  United  States  into  zones,  and  it  will  determine  and  announce  basic  yields  of 
oil,  meal,  linters,  and  hulls  from  cotton  seed  for  each  zone,  and  differentials  or  spreads 
to  represent  the  difference  between  the  price  paid  for  cotton  seed  and  the  total  amount 
any  licensee  engaged  in  the  business  of  crushing  cotton  seed  may  receive  from  the  sale 
of  the  manufactured  products  of  the  cotton  seed.  The  licensee  will  be  permitted  to 
sell  all  manufactured  products  in  excess  of  the  basic  yields  without  reference  to  the 
established  margin,  provided  that  the  price  charged  for  such  excess  products  shall  not 
exceed  the  average  price  that  will  be  indicated  for  the  other  products  in  said  yield. 
(Issued  Nov.  1,  1917;  repealed  May  31,  1919.) 

D.  SPECIAL  REGULATIONS  GOVERNING  REFINERS  OF  COTTONSEED 
OIL,  PEANUT  OIL,  SOYA-BEAN  OIL,  PALM-KERNEL  OIL,  PALM  OIL, 
AND  COPRA  OIL,  AND  DEALERS  AND  BROKERS  IN  SUCH  REFINED 
OIL. 

Rule  5.  Domestic  oil  to  be  sold  at  reasonable  advance  over  cost. — The  licensee 
shall  sell  cottonseed  oil,  peanut  oil  manufactured  from  domestic  peanuts,  and 
soya-bean  oil  manufactured  from  domestic  soya  beans  at  not  more  than  a 
reasonable  advance  over  the  average  cost  to  licensee  of  the  crude  oil  from  which 
such  oil  was  relined.1  (The  licensee  may  consider  all  refining  plants  operated 
by  or  controlled  by  such  licensees  as  a  single  unit.  Licensees  who  control  mills 
crushing  oleaginous  materials  must  credit  all  raw  materials  obtained  from  such 
crushing  mills  at  the  same  price  at  which,  they  could  purchase  the  same 
products  in  the  open  market  at  the  time  of  transfer.)  (Issued  Jan.  28,  1918; 
repealed  May  31,  1919.) 

NOTE. — The  United  States  Food  Administration  will  indicate  from  time  to  time  what 
margins  it  considers  fair. 

E.  MANUFACTURERS  AND  DEALERS  IN  LARD   SUBSTITUTES. 

(Issued  Jan.  28,  1918;  repealed  May  31,  1919.) 

Rule  2.  Licensees  engaged  in  the  manufacture  and  distribution  of  lard  substi- 
tutes may  consider  all  plants  for  the  manufacture  of  lard  substitutes  operated 
by,  belonging  to,  or  controlled  by  the  licensee  as  one  unit  for  the  purpose  of  deter- 
mining costs  and  profits. 

Rule  3.  Licensees  engaged  in  the  manufacture  of  lard  substitutes  who  own  or 
control  mills  crushing  cotton  seed,  peanuts,  or  other  oleaginous  materials  must 

1  Issued  July  1,  1918  ;  repealed  as  to  all  except  "  cotton  seed  "  Feb.  1,  1919. 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES.  599 

credit  all  raw  material  obtained  from  such  crushing  mills  at  the  same  price  at 
which  they  could  purchase  the  same  products  in  the  open  market  at  the  time  of 
transfer. 

Rule  4.  Licensees  engaged  in  the  manufacture  of  lard  substitutes  who  own  or 
control  plants  for  the  refining  of  vegetable  oils  must  credit  the  refined  oil  received 
from  said  refining  plants  at  the  same  price  at  which  they  could  obtain  the  same 
product  in  the  open  market  at  the  time  of  the  transfer. 

Rule  5.  Every  licensee  who  owns  or  controls  a  plant  for  the  manufacturing  of 
lard  substitutes  shall  be  subject  to  such  differentials  and  spreads  for  the  cost  of 
manufacture  of  crude  material  into  a  finished  product  as  may  from  time  to  time 
be  determined  and  announced  by  the  United  States  Pood  Administrator  to  return 
a  fair  profit  to  the  licensee. 

Rule  6.  No  manufacturer  engaged  in  the  manufacture  of  lard  substitutes  shall, 
without  the  written  permission  of  the  United  States  Food  Administrator,  sell  or 
offer  to  sell  lard  substitutes  at  higher  prices  in  one  market  than  he  is  selling  or 
offering  to  sell  the  same  quality  or  brand  in  any  other  market  on  the  same  day. 
The  price  for  sales  in  lots  of  5,000  pounds  or  more,  tierce  basis,  for  delivery  at 
one  time,  net  after  deducting  all  discounts  and  allowances,  shall  be  taken  as  the 
basis  in  making  comparisons  for  the  purpose  of  this  rule.  In  comparing  with 
this  the  selling  price  of  lots  of  less  than  5,000  pounds,  tierce  basis,  for  delivery 
at  one  time,  1£  cents  per  pound  will  be  deducted  from  the  price  actually  charged. 
In  comparing  the  price  of  package  and  case  goods,  stated  differentials  will  be 
determined  by  the  United  States  Food  Administrator  from  time  to  time  for  all 
manufacturers  of  lard  substitutes.  (Issued  Mar.  23,  1918.) 

X.  SPECIAL  REGULATIONS  GOVERNING  MANUFACTURERS  OF 
OLEOMARGARINE  AND  OTHER  BUTTER  SUBSTITUTES. 

Rule  1  (effective  Dec.  4,  1918).  Maximum  margins  for  manufacturers. — The 
manufacturer  shall  not  sell  oleomargarine  or  other  butter  substitutes  at  a  greater 
average  advance  over  the  cost  of  the  raw  material  (in  any  period  of  two  months 
beginning  Dec.  1)  than  the  sum  of  his  actual  manufacturing  cost  plus  a  profit 
not  to  exceed  10  per  cent  of  the  selling  price  to  the  wholesale  trade.  In  no  case 
shall  the  manufacturing  cost  be  figured  in  excess  of  $6.30  per  hundred  pounds. 
(Repealed  Jan.  26,  1919.) 

Manufacturing  costs  shall  include : 

1.  Labor. 

2.  Selling  expenses. 

3.  Advertising. 

4.  Administrative  expenses. 

5.  Depreciation. 

6.  Taxes,  not  including  excess-profits  tax  and  income  tax. 

7.  Miscellaneous  manufacturing  expenses,  not  including  interest  charges. 
The  cost  of  raw  materials  shall  mean  the  cost,  delivered,  at  plant  of  following : 
(a)  Oils. 

(6)  Milk. 

(c)  Salt. 

(d)  Package. 

(e)  Color. 

(f)  Stamps. 

(g)  Cartons  and  paper. 
(h)   Supplies. 

NOTEJ.^ — The  Food  Administration  does  not  recognize  $6.30  per  hundred  pounds  as  a 
normal,  reasonable  cost  of  manufacture,  nor  10  per  cent  net  profit  as  a  normal,  reasonable 
net  profit.  These  are  maximum  margins  to  cover  the  most  expensive  legitimate  methods 
of  operation. 

XL  WHOLESALERS,   JOBBERS,    IMPORTERS,   RETAILERS. 

A    SPECIAL  RULES  APPLYING  TO  LICENSED  NONPERISHABLE  FOOD 

COMMODITIES. 

Rule  5  (as  amended  Dec.  31,  1918).  Must  sell  at  reasonable  advance  over 
average  purchase  price. — The  licensee,  without  regard  to  market  or  replace- 
ment value  at  the  time  of  such  sale,  shall  sell  the  following  commodities  at  not 
more  than  a  reasonable  advance  over  the  average  purchase  price  of  all  lots  of 


600  HISTORY   OF  PRICES  DURING  THE  WAR. 

the  same  grade  and  size  of  the  same  commodity  in  Iris  possession  or  invoiced  to 
him  not  contracted  to  be  sold : 

Self-rising  flour.  '  Dried  raisins. 

1  Cleaned  rice.  *  Dried  beans. 

1  Rice  flour.  1  Dried  peas. 

1  Oleomargarine.  J  Rye  flour. 

1  Lard.  *  Barley  flour. 

1  Lard  substitutes.  *  Oatmeal. 

*Oleo  oil.  J  Rolled  oats. 

1  Cooking  fats.  1  Corn  grits. 
1  Condensed,  evaporated,   or  powdered     *  Corn  meal. 

milk.  1  Hominy. 
1  Canned  or  cured  beef,  pork,  or  mut-     1Corn  flour. 

ton.  ,  a  Corn  starch. 

1  Canned  peas.  *  Corn  oil. 

1  Canned  dried  beans.  *  Corn  sirup. 

1  Canned  tomatoes.  *  Glucose. 

1  Canned  corn.  *  Sirups. 

1  Canned  salmon.  *  Molasses. 
1  Canned  sardines.  Maple  sugar. 

1  Dried  prunes.  Maple  compounds. 

1  Dried  apples.  Clarified,      plantation- washed,      and 
1  Dried  peaches.  open-kettle  sugars. 

The  licensee  shall  keep  a  record  of  the  manner  in  which  such  average  has  been 
arrived  at,  and  he  shall  take  as  the  cost  of  all  stock  remaining  on  hand  from 
lots  already  averaged  the  average  cost  previously  arrived  at. 

In  selling  commodities  not  yet  invoiced  to  him  he  shall  sell  at  not  more  than 
a  reasonable  advance  over  the  actual  purchase  price  to  him  of  all  lots  of  the  same 
grade  and  size  of  the  same  commodity  purchased  by  him  but  not  yet  invoiced 
to  him. 

(This  rule  corresponds  to  special  rules  1  and  2,  series  B,  governing  -wholesalers  and 
retailers.  See  special  rules  H,  following,  for  green  coffee.) 

EXPLANATION. 

NOTE. — This  rule  prohibits  speculation  in  licensed  commodities. 

The  following  is  an  example  of  the  method  by  which  the  average  cost  shall  be  deter- 
mined, taking  flour  as  an  example : 

Cost  per 

Barrels,  barrel.            Total. 

Lot    A__                                                               20  $10.  50          $210.  00 

Lot     B 30  11.  00            330.  00 

Lot     C 25  10.  75            268.  75 

75  808.  75 


Average    cost   per   barrel 10.  78 

Reasonable    advance .  50 

11.  28 

Suppose  that  35  barrels  are  then  sold  at  $11.28  and  15  barrels  purchased  at  $11.     The 
calculation  for  further  sales  will  then  be  made  as  follows  : 

Cost  per 
Barrels,     barrel.  Total. 

Barrels  remaining  on  hand  from  lot  previously  averaged 40          $10.  78          $431.  20 

Lot   D    (new   purchase) 15  11.00  165.00 

55  596.  20 


Average   cost   per  barrel 10.84 

Reasonable    advance .  50 


Sellng    price 11.34 

1  Rule  providing  for  sale  of  these  commodities  4<  at  not  more  than  reasonable  advance 
over  actual  purchase  price  of  particular  goods  sold,"  issued  Nov.  1,  1917.  Wheat  flour 
and  mixed  flour  and  other  commodities  listed  in  rule  issued  June  15,  1918.  Repealed  as 
to  wheat  flour  and  mixed  flour  Dec.  31,  1918.  Repealed  as  to  all  commodities,  except  lard 
and  lard  substitutes  made  from  cotton  seed,  Jan.  10,  1919.  Repealed  as  to  lard  Apr.  1, 
1919.  Repealed  May  31,  1919,  as  to  lard  substitutes  made  from  cotton  seed. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  601 

Neither  the  Food  Administration  nor  any  other  branch  of  the  Government  has  pre- 
scribed uniform  cost  accounting-  systems  for  either  wholesale  or  retail  food  distributors. 
The  Government  has  not,  therefore,  indicated  how  the  licensee,  in  dealing  with  a  com- 
modity covered  by  the  reasonable  profit  rule,  shall  dispose  of  cartage,  interest,  or  other 
special  charges,  but  it  does  expressly  forbid  the  employment  of  such  charges  with  the  pur- 
pose, or  with  the  effect,  of  increasing  the  licensee's  profit  above  his  own  reasonable  pre- 
war level. 

The  licensee  shall  not,  in  calculating  cost,  include  accruals  or  payments  of  Federal  in- 
come, corporation  or  excess  profits  taxes. 

A  wholesaler  who  also  does  a  retail  business  is  not  required  to  sell  to  both  classes  of 
customers  at  the  same  price ;  and  a  merchant,  if  he  desires,  may  make  prices  in  the  case 
of  cash  sales,  or  sales  upon  which  he  does  not  have  to  perform  the  delivery  service,  differ- 
ent from  his-  prices  when  credit  is  given  or  delivery  made.  The  test  is,  Are  the  commodi- 
ties being  sold  at  not  more  than  a  reasonable  advance  over  the  average  price. 

Regarding  special  discounts  to  favored  customers,  see  General  License  Regulations  No. 
I,  rule  5,  relating  to  discriminatory  charges.  If  the  consumer  does  not  get  the  benefit  of 
the  discount  and  the  retailer  retains  it  in  addition  to  his  allowed  profit,  then  the  retailer 
is  selling  at,  an  unreasonable  advance.  The  giving  of  special  discounts  to  favored  cus- 
tomers! by  wholesalers  at  least  tends  to  cause  the  wholesaler  to  sell  to  other  customers 
at  a  greater  advance  than  he  would  if  no  special  discounts  to  favored  customers  were 
given.  The  United  States  Food  Administration  intends  to  scrutinize  all  transactions  in- 
volving special  discounts  and  rebates  of  every  kind  given  by  licensees. 

Under  Rule  XI-A-5  the  licensee  is  not  required  to  average  the  purchase  price 
of  commodities  of  different  brands  that  are  of  a  proprietary  nature,  even  though 
the  grade  and  size  are  the  same.  He  may  average,  however,  if  he  desires. 
(Opinion  A-108,  July  23,  1918.) 

A  wholesaler  or  jobber  in  the  commodities  mentioned  \a  rule  A-5,  Special 
License  Regulations  XI,  who  conducts  branches  in  one  or  more  localities  should 
calculate  his  costs  according  to  each  locality  and  sell  at  not  more  than  the 
maximum  margins  over  delivered  costs  in  each  particular  vicinity.  (Opinion 
A-117,  Aug.  26,  1918.) 

The  Food  Administration  has  determined,  after  careful  consideration,  that  it 
will  at  present  issue  no  regulations  prohibiting  the  sale  of  foodstuffs  at  less  than 
cost.  Action  will  be  taken,  however,  in  cases  where  wholesalers  or  retailers  are 
selling  licensed  foods  at  less  than  their  purchase  price  plus  railroad  transporta- 
tion charges,  with  the  result  of  stimulating  the  consumption  of  such  foodstuffs 
and  increasing  the  margin  which  the  dealer  can  charge  for  other  goods.  Each 
case  will  be  considered  on  its  individual  merits.  It  is  considered  most  inadvis- 
able to  attempt  to  limit  sales  at  less  than  "  cost,"  as  ordinarily  defined  in  busi- 
ness, because  of  the  difficulty  of  calculating  overhead  expense  per  unit.  The 
purchase  price  forms  a  simple  test  where  the  other  elements  of  stimulating  con- 
sumption and  increasing  profits  in  other  licensed  foodstuffs  are  present. 

It  has  been  pointed  out  that  there  are  many  instances  in  which  dealers  may  be 
compelled  by  the  condition  of  the  market  or  of  the  goods  to  sell  at  considerably 
less  than  cost,  especially  in  the  case  of  perishables,  and  the  Food  Administration 
does  not  regard  the  practice  in  such  case  as  unfair  (Oct.  10, 1918). 

MAXIMUM  MARGINS   ON  SALES  BY  WHOLESALERS  TO  RETAILERS. 

Commodities.  Maximum  margins. 

Sugar__      15-35  cents  per  100  pounds. 

Wheat   flour.  _  50-75  cents  per  barrel. 

Lard,  lard  substitutes,  bulk  (packages  of  50  pounds  or  over) l$-2  cents  per  pound. 

Standard    hams,    bacon 1-2  cents  per  pound. 

All  flours   (except  wheat) 1 

Lard  and  lard  substitutes,  in  packages  (less  than  50  pounds) __ 

Condensed,  evaporated  milk -..f8-  °  per  cent" 

Blackstrap  molasses  in  barrels J 

Rice,  hominy,  grits,  oatmeal,  rolled  oats,  corn  meal,  beans,  in 

bulk   (packages  of  25  pounds  or  over) 10-12J  per  cent. 

Rice,  corn   meal,   hominy,  grits,  oatmeal,   self-rising  and   pre- ' 
pared  flour,  and  rolled  oats,  all  in  packages 

Corn  oil,  corn  sirup,  sugarhouse  sirup,  mixed  sugar  and  corn 

sirup,    and   cottonseed    oil U*>-15  uer  cent 

Standard  and  extra  standard  licensed  canned  peas,  tomatoes,  ' 
corn,  and  canned  dried  beans,  and  pink,  chum,  and  red  sal- 
mon, and  all  domestic  sardines 

All  licensed  dried  prunes,  apples,  peaches,  raisins 

NOTE. — Percentages  should  be  figm-ed  on  the  wholesaler's  selling  price.  The  maximum 
margin  on  sugar  has  been  increased  to  35  cents  per  100  pounds  for  wholesale  grocers 
and  food  jobbers  who  actually  perform,  as  to  substantially  all  the  sugar  handled  by 
them,  the  functions  of  buying,  warehousing,  selling,  and  distributing.  But  this  maximum 
margin  is  not  allowed  where  such  service  is  not  performed.  Margins  for  sugar  dealers 


602  HISTORY   OF   PRICES   DURING   THE   WAR. 

are  not  changed.  Rye  flour  has  been  transferred  to  the  8-10  per  cent  classification. 
Prepared  flours,  sugarhouse  sirup,  and  mixed  sugar  and  corn  sirup,  have  been  placed 
in  the  12-15  per  cent  classification.  All  domestic  sardines  and  all  grades  of  licensed 
dried  fruits  are  now  included  within  the  12-15  per  cent  classification. 

Any  gross  margins  above  delivered  cost  upon  sales  in  unbroken  cases  to  retailers  in 
excess  of  the  foregoing  margins  will  be  regarded  as  prima  facie  evidence  of  a  violation 
of  the  statute  and  the  regulations. 

In  case  the  licensee  breaks  original  packages  he  may  add  to  his  cost  the  actual  cost 
of  such  repacking,  in  no  case  to  exceed  5  per  cent  ^ 

It  should  be  noted  that  the  above  differentials  are  maximum  margins,  which  must 
not  be  exceeded  by  the  wholesaler. 

Licensed  commodities  not  covered  by  the  above  margins  shall  not  be  sold  at  a  margin 
above  delivered  cost  to  the  wholesaler — average  purchase  price  plus  freight  to  public 
railway  terminal  in  jobber's  city  or  town — of  the  particular  goods  sold  which  will  yield 
any  greater  profit  than  the  dealer  customarily  enjoyed  on  the  same  commodity  in  the 
prewar  period  on  an  even  market  under  freely  competitive  conditions. 

High  margins,  even  if  customary  during  prewar  period,  are  not  justifiable  now.  Un- 
reasonable margins  are  not  excused  by  lower  margins  on  other  transactions  in  the 
same  commodity  or  in  other  commodities. 

The  margins  named  are  ample  to  include  all  ordinary  carrying  charges.  If  general  con- 
ditions should  later  necessitate  the  carrying  of  goods  for  a  longer  period  than  usual, 
further  consideration  will  be  given  to  this  feature.  In  determining  the  cost  of  dried 
fruit,  the  licensee  may  add  to  his  purchase  price  not  more  than  one-eighth  cent  per 
pound  per  month  on  dried  fruit,  actually  carried  in  cold  storage  between  May  1  and 
November  1,  not  to  exceed  three-fourths  cent  per  pound,  on  any  particular  lot  of  goods. 

Any  change  from  the  prewar  custom  in  cash  discount  terms,  cartage,  or  other  charges, 
which  tends  to  or  results  in  increasing  the  margin  of  profit  allowed,  will  be  dealt  with 
as  an  unfair  practice. 

WHAT    RESALES    ARE    JUSTIFIABLE. 

(The  following  applies  to  all  licenses  governed  by  the  rules  contained  in  this 
pamphlet.) 

General  rule  6  reads  as  follows :  "  The  licensee,  in  selling  food  commodities,  shall 
keep  such  commodities  moving  to  the  consumer  in  as  direct  a  line  as  practicable  and 
without  unreasonable  delay.  Resales  within  the  same  trade  without  reasonable  justifi- 
cation, especially  if  tending  to  result  in  a  higher  market  price  to  the  retailer  or  con- 
sumer, will  be  dealt  with  as  an  unfair  practice." 

Service. — Any  transactions  that  savor  of  trading  in  which  a  profit  accrues  to  the 
dealer  without  corresponding  service,  are  clear  violations  of  the  rule  and  will  subject 
the  offender  to  revocation  of  his  license  and  to  such  other  penalty  as  the  law  provides. 
A  resale  that  is  in  keeping  with  one  of  the  following  principles  will  be  considered  lawful 
under  general  rule  6 : 

A.  Continuous    service. — The   seller    may    customarily    and    continuously    serve    in    less 
than  carload  lots  wholesale  grocers  who  are  serving  retail  grocers,  but  who  are  unable 
for  some  sufficient  and  legitimate  reason  to  purchase  direct  from  the  source  of  supply. 

B.  Carload   buying. — A   wholesaler   or  jobber   may   enjoy   the   benefit   of   carload   rates 
from   distant  points  and  sell   to   smaller   wholesale   grocers  who   are  unable   to   buy   the 
commodity  in  carload  lots. 

C.  Warehousing. — A   wholesaler   or   jobber   may   continuously   and   customarily    furnish 
cold  storage  or  other  warehousing  service  and   sell   to  wholesale  grocers  who  have  not 
adequate  facilities  of  that  character. 

D.  Surplus    stocks. — A    wholesaler    may    dispose    of    surplus    stocks    bought,    not    for 
speculation,  but  in  good  faith  for  the  reasonably  anticipated  requirements   of  his  busi- 
ness  under  the  rules  and   regulations  and   which   he  finds  himself  unable  to   dispose  of 
to  his  regular  customers.     The  fact  that  such  goods  have  not  been  warehoused  by  such 
wholesaler  will  be  regarded  as  prima  facie  evidence  that  they  were  not  bought  in  good 
faith. 

Only  one  resale  permitted. — The  distributor  who  purchases  from  a  wholesaler  or 
jobber  must  not,  under  any  circumstances,  resell  the  goods  in  question  to  a  wholesaler 
or  jobber,  but  must  distribute  directly  to  retailers  or  consumers. 

MAXIMUM    MARGINS    ON   RESALES    JUSTIFIED    BY    PERFORMANCE    OF   ACTUAL 
SERVICE  SPECIFIED  IN  A,  B,  C,  AND  D,  ABOVE. 

1.  Seller's  margins. — The  margin  of  profit  enjoyed  by  the  wholesaler  or  jobber  selling 
to  another  wholesaler  or  jobber  shall  in  no  case  exceed  one-half  of  the  maximum  margin 
named  for  the  particular  commodity  in  the  wholesaler's  list  above.     These  margins  shall 
include  all  cartage,  storage,  interest,  and  other  charges. 

2.  Purchaser's   margins. — The   distributor    who   has   thus   purchased    within    the    trade 
shall   sell  the  goods  so  purchased  at  not  more  than  the  lower  margin   indicated   in   the 
list  above. 

MAXIMUM    MARGIN    ON    OTHER    RESALES. 

3.  On  all  other  resales,   such  as  accommodation  sales,   commonly  known  in   the  trade 
as  "  pick-ups,"  only  one  wholesale  profit   (as  indicated  by  the  above  maximum  margins) 
is  allowed,  but  this  one  allowable  profit  may  be  divided  between  the  wholesalers  as  they 
determine. 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES.  603 

MARGINS   FOR  CLEAN  RICE   DEALERS   IN   SELLING  TO   WHOLESALERS. 

(As  amended  Nov.  25,  1918.) 

Where  a  rice  dealer's  business  was  established  prior  to  August  10,  1917,  the  Food 
Administration  will  permit  one  such  dealer  to  handle  rice  between  the  miller  and  the 
wholesale  grocer,  but  no  resale  of  rice  between  such  dealers  will  be  permitted.  Except 
in  the  case  of  such  established  business,  it  is  considered  that  rice  should  be  on  the 
same  basis  as  other  manufactured  cereal  products  so  far  as  resale  within  the  trade  is 
concerned.  All  sales  of  rice  made  through  any  distributing  company  in  which  the  mill 
is  interested  must  be  made  at  the  original  mill  price  except  as  specifically  provided 
below  for  millers'  selling  agencies. 

Sales  by  established  dealers  referred  to  above  at  margins  over  cost  greater  than  the 
following  maximum  margins  will  be  considered  a  violation  of  the  regulations  : 

MAXIMUM  MARGINS. 

1.  Carload  lots,  including  mixed  cars,  shipment  direct  from  mill  or  reconsigned  without 
unloading — not  to  exceed  2J  per  cent. 

2.  Pooled  cars,   shipment  direct  from   mill  or   reconsigned  without  unloading — not  to 
exceed  4  per  cent. 

3.  Carload   lots,   including   mixed   cars,   where   dealer  unloads  and   handles  through  a 
warehouse — not  to  exceed  4  per  cent. 

4.  Less  than  car  lots,  including  pooled  cars,  where  dealer  unloads  and  handles  through, 
a  warehouse — not  to  exceed  6|  per  cent. 

In  the  first  three  cases  mentioned  any  wholesale  grocer  buying  from  a  dealer  may 
take  the^same  margin  as  if  he  had  bought  direct  from  the  mill.  In  the  fourth  case  the 
wholesaler  is  limited  to  a  10  per  cent  margin  and  may  not  resell  to  another  wholesaler. 

MILLERS'   SELLING  AGENCIES. 

A  company  acting  as  a  dealer  which  was  established  prior  to  August  10,  1917,  may 
carry  on  its  own  business  in  accordance  with  the  margins  indicated  above,  although  it 
is  owned  or  controlled  by  a  rice  miller,  provided  that  no  larger  proportion  of  rice  Is 
sold  by  the  miller  through  such  company  than  the  average  proportion  so  sold  during 
the  next  three  preceding  years. 

Where  a  miller  maintains  a  branch  office  which  receives  rice  in  car  lots  on  consign- 
ments from  the  mill,  warehouses  this  rice,  and  distributes  it  in  less  than  car  lots  to 
wholesale  grocers,  such  branch  office  shall  be  permitted  to  add  to  the  miller's  maximum 
prices  not  more  than  3  per  cent  for  the  service  performed,  provided  that  no  larger 
proportion  of  the  mill's  product  is  thus  sold  through  such  branch  house  than  the  average 
proportion  so  sold  during  the  next  three  preceding  years. 

NOTE. — Where  a  selling  company  owned  or  controlled  by  a  miller  sells  directly  to 
retailers  in  less  than  car  lots,  it  may  add  a  margin  not  greater  than  that  added  by  other 
licensees  performing  similar  services. 

(New,  Nov.  16,  1918.)  The  maximum  margin  of  from  8  to  10  per  cent  upon  the  sale 
of  condensed  evaporated  milk  does  not  apply  to  such  milk  when  packed  in  barrels. 

Nom — Resales  of  cornstarch. — Issued  October  31,  1918.  The  attention  of  the  Food 
Administration  has;  been  called  to  speculation  and  intertrading  in  bulk  cornstarch.  Atten- 
tion is  called  to  the  fact  that  the  resale  regulations  applying  to  wholesalers  of  other 
groceries  apply  in  full  to  cornstarch  in  bulk  or  in  packages  (see  Rule  XI-A-5  Note). 
Under  general  rule  6  the  Food  Administration  considers  that  a  dealer  in  cornstarch 
should  only  sell  cornstarch : 

1.  To  a   manufacturer   using   cornstarch   in  his   manufacture    (including   confectioners 
and  bakers). 

2.  To  retail  grocers  and  consumers. 

3.  To  smaller  wholesale  grocers  under  one  of  the  following  circumstances : 

A.  Continuous  service. — The  dealer   may   customarily  and   continuously   serve  in   less- 
than-carload  lots  wholesale  grocers  who  are  serving  retail   grocers  but  who  are  unable 
for  some  sufficient  and  legitimate  reason  to  purchase  direct  from  the  source  of  supply. 

B.  Carload   buying. — A   dealer   may   enjoy   the  benefit   of  carload    rates   from    distant 
points  and   sell  to  smaller  wholesale  grocers  who  are  unable  to  buy  /he  commodity   in 
carload  lots. 

C.  Warehousing. — A  dealer  may  continuously  and  customarily  furnish  cold  storage  or 
other  warehousing  service  and  sell  to  wholesale  grocers;  who  have  not  adequate  facilities 
of  that  character. 

D.  Surplus  stocks. — A  dealer  may  dispose  of  surplus  stocks  bought,  not  for  speculation, 
but  in  good  faith  for  the  reasonably  anticipated  requirements  of  his  business  under  the 
rules  and   regulations  and   which   he  finds  himself   unable   to   dispose  of  to   his   regular 
customers.     The  fact  that  such  goods  have  not  been  warehoused  by  such  dealer  will  be 
regarded  as  prima  facie  evidence  that  they  were  not  bought  in  good  faith. 

Where  cornstarch  is  used  by  manufacturers  in  any  quantity  there  should  be  not  more 
than  one  dealer  between  the  cornstarch  manufacturer  and  the  manufacturer  using  corn- 


604  HISTORY   OF   PRICES   DURING  THE  WAR. 

starch.  The  greater  number  of  such  sales  should  he  made  direct  without  the  interposition 
of  any  dealer.  No  manufacturer  who  purchases  cornstarch  can  resell  the  same  without 
the  written  permission  of  the  United  States  Food  Administrator,  which  will  be  given  in 
proper  cases  on  the  condition  that,  the  purchaser  is  not  required  to  pay  a  total  margin 
over  the  cornstarch  manufacturer's  price  greater  than  that  permitted  to  a  single  dealer 
plus  actual  freight. 

Margins  and  profits. — Under  Rule  XI-A-5  the  Food  Administration  will  consider  any 
gross  margins  above  delivered  cost  in  excess  of  those  listed  below  as  prima  facie  evidence 
of  a  violation  of  the  statute  and  regulations,  and  cause  for  revocation  of  a  dealer's 
license. 

A.  Where  cornstarch  is  sold  in  car  lots  without  warehousing,  not  to  exceed  4  per  cent. 

B.  Where  cornstarch   is  sold   in   less  than  car   lots  to  bakers,   mixers,   manufacturers, 
or  retailers,  not  to  exceed  8  to  10  per  cent,  in  bulk  or  barrels,  not   to  exceed   12   to   15 
per  cent  in  packages. 

C.  Where  cornstarch  is  sold  to  a  smaller  wholesale  grocer  under  the  resale  provisions 
given  above  in  less  than  car  lots,  not  to  exceed  7!  per  cent  in  bulk. 

D.  Where  the  dealer  breaks  original  packages  he  may  add  to  his;  cost  the  cost  of  the 
new  package  plus  actual  cost  of  repacking,  in  no  case  to  exceed  5  per  cent. 

Sale  of  lard  substitutes. — The  following  ruling  has  been  made  by  the  law  department 
in  reply  to  an  inquiry  regarding  jobbers'  margins  on  lard  substitute : 

"  We  beg  to  acknowledge  your  letter  of  September  28  in  which  you  inquire  whether  it 
is  against  the  Food  Administration  regulations  for  a  wholesale  jobber  to  sell  lard  sub- 
stitute at  less  than  24  J  cents,  tierce  basis,  which  under  the  stabilized  program  he  pur- 
chases at  23  cents.  The  Food  Administration  regulations  provide  a  maximum  margin 
for  the  wholesaler  of  li  to  2  cents  per  pound  over  the  purchase  price  delivered  at  rail- 
road station.  A  general  stabilization  program  affecting  lard  substitutes  and  other  cotton- 
seed products  has  now  been  adopted  by  the  Food  Administration  for  the  purpose  of 
eliminating  speculation  and  reducing  the  margin  between  the  producer  of  cotton  seed  and 
the  consumer  of  lard  substitutes,  and  this  program  has  been  approved  by  representatives 
of  all  interests  concerned,  wTho  have  expressed  their  desire  to  cooperate.  In  view  of  the 
circumstances  surrounding  this  program,  it  will  hereafter  be  considered  an  unfair  practice 
for  any  jobber  to  sell  lard  substitutes  or  lard  compound  in  lots  of  less  than  5,000  pounds 
at  a  margin  over  his  delivered  purchase  price  less  than  li  cents  or  1J  cents  where  the 
jobber  purchases  in  lots  of  30,000  pounds  or  more  and  receives  a  concession  of  \  cent. 

"  It  should  be  pointed  out  that  this  action  rests  solely  on  the  peculiar  circumstances 
surrounding  the  cottonseed  program.  The  reasons  applying  to  lard  substitutes  do  not 
apply  to  any  other  commodity  handled  by  wholesale  grocers  ;  and  the  policy  of  the  Food 
Administration  and  its  distribution  division  is  decidedly  opposed  to  the  application  of 
any  similar  principle  to  other  commodities. 

"  It  should  further  be  pointed  out  that  the  2  cent  maximum  margin  for  jobbers  applies 
on  the  actual  purchase  price.  The  jobber  who  purchases  in  lots  of  30,000  pounds  at  22| 
cents  must  sell  at  not  to  exceed  24|  cents." 

The  maximum  margins  permitted  on  sales  of  nonperishables  by  wholesalers  to  retailers 
prescribed  in  the  announcement  of  June  6,  1918,  and  in  the  note  to  Rule  XI— A— 5  include 
local  cartage,  but  does  not  include  delivery  charges  incurred  by  the  wholesaler  in  de- 
livering by  truck  to  points  to  which  shipment  might  be  made  by  rail.  The  actual  ex- 
pense of  making  such  deliveries  by  truck  may  be  charged  by  the  seller  to  the  parties  to 
whom  the  sale  is  made  after  the  price  has  been  fixed  by  the  seller  in  conformity  with 
said  rule  A— 5  and  announcement  of  June  6.  In  no  case,  however,  shall  the  added  charge 
be  in  excess  of  the  freight  charge.  (Opinion  A-113,  July  26,  1918.) 

A  brokerage  may  be  paid  to  a  broker  in  a  permissible  resale  from  one  jobber  or 
wholesaler  to  another ;  the  brokerage  must,  however,  be  deducted  from  the  profit  of 
either  the  buyer  or  seller  so  that  the  price  of  goods  in  the  course  of  further  distribution 
shall  not  bear  such  brokerage.  (Opinion  A-118,  Aug.  26,  1918.) 

MAXIMUM   MARGINS    ON    SALES   BY    RETAILERS   TO    CONSUMERS. 

(Issued   Nov.    7,    1918.) 

The  Food  Administration  has  determined  that  any  sales  of  food  commodities  at  a 
gross  margin  above  delivered  cost  in  excess  of  those  indicated  below  are  unreasonable, 
and  will  be  regarded  as  prima  facie  evidence  of  a  violation  of  the  statute  and  of  the 
above  regulation.  Percentage  may  be  calculated  on  the  selling  price.  Delivered  cost 
shall  mean  the  cost  at  the  railroad,  steamboat,  or  other  terminal  in  the  retailer's 
town.  Where  the  retailer  is  not  located  in  a  railroad  or  steamboat  town  he  may  include 
any  hauling  charge  in  the  delivered  cost. 

The  lesser  margin  indicated  is  not  a  minimum  margin,  but  is  a  maximum  margin 
for  those  whose  cost  of  doing  business  is  less,  such  as  stores  which  do  not  perform 
the  services  of  credit  and  delivery.  Any  change  from  the  prewar  practice  in  cash 
discount  terms  or  other  changes  which  tend  to  or  result  in  increasing  the  margin  of 
profit  allowed  will  be  dealt  with  as  an  unfair  practice. 

The  retailer  may  have  the  benefit  of  fractional  costs  on  each  transaction ;  that  is, 
he  may^  calculate  the  total  charge  to  a  customer  on  any  transaction  as  if  fractional 
costs  were  not  allowed,  and  if  the  result  is  a  fraction,  he  may  add  thereto  such  fraction 
of  a  cent  as  may  be  necessary  to  make  a  price  in  even  cents.  The  following  table 
gives  an  example  in  the  case  of  eggs,  using  the  cash  and  carry  margin  of  7  cents 
per  dozen : 


GOVERNMENT   REGULATIONS   RELATING -TO   PRICES. 


605 


Amount  of  sale. 


Cost. 


Margin 
(cents). 


Total. 


Fraction 
added. 


Maximum 
selling 
price. 


1  dozen J0.46J                     7            $0.  53i  |§.54 

2  dozen .92|                   14              1.06J  1.07 

Sdozen \           1.38f                   21              1.59f  1.60 

| 

MAXIMUM    MARGINS. 

Barley   flour,    original    mill    packages _: 18  to  22  per  cent. 

Barley   flour,   broken    mill   packages          1 0.01J   per  pound. 

Rye  flour,   original   mill   packages 18  to  22  per  cent. 

Rye   floifr,   broken   mill  packages 0.01J   per  pound. 

Corn   flour,   original    mill   packages 18  to  22  per  cent. 

Corn   flour,   broken   mill   packages O.G1J   per  pound. 

Rice    flour 18  to  22  per  cent. 

Corn   meal,   bulk * O.Oli  per  pound. 

Corn   meal,  original  mill   packages 18  to  22  per  cent. 

Hominy 18  to  22  per  cent. 

Sugar,  all  kinds  in  bulk 0.01|   per  pound. 

Sugar,   all   kinds  in   refiners'   original   packages 0.01  per  pound. 

Evaporated    milk,    unsweetened ! 18  to  22  per  cent. 

Oatmeal-and  rolled  oats,  bulk . O.Oli   per  pound. 

Oatmeal  and  rolled  oats,  original  mill  packages 20  to  25  per  cent. 

Rice__  20  to  25  per  cent. 

Beans,   white  or   colored 2O  to  25  per  cent. 

Starch,    edible 20  to  25  per  cent. 

Corn   sirup,   tins 20  to  25  per  cent. 

Canned   corn,  peas,   and  tomatoes,   standard  grades 25  to  30  per  cent. 

Canned  salmon  chums,  pink,  and  red 25  to  30  per  cent. 

Canned  sardines,    domestic 25  to  30  per  cent. 

Dried    fruit,    raisins,    prunes,    and    peaches 25  to  30  per  cent. 

Lard,    pure   leaf,   bulk 5  to  6  cents  per  pound. 

Lard,    pure    leaf,    tins 18  to  22  per  cent. 

Lard,    substitutes,    bulk 5  to  6  cents  per  pound. 

Lard,    substitutes,    tins 18  to  22  per  cent. 

Breakfast   bacon,   whole   pieces 6  to  7  cents  per  pound. 

Heavy   bacon,    whole   pieces 5  to  6  cents  per  pound. 

Hams,     smoked,    whole 6  to  7  cents  per  pound. 

In  quoting  sliced  ham  and  bacon  add  usual  differential  to  cover  actual  shrinkage. 

"  Original  mill  packages "  as  used  above  means  where  retailer  sells  product  in  the 
same  mill  container  as  received  by  him. 

"  Broken  mill  packages  "  means  when  retailer  removes  contents  from  original  pack- 
ages and  sells  in  smaller  quantities. 

By  other  special  regulations  the  retailer's  maximum  margins  have  also  been  fixed 
in  accordance  with  the  following  list : 

Potatoes,   white   or    Irish 25  to  30  per  cent. 

Onions : 25  to  30  per  cent. 

Eggs    (whether   sold   in   carton   or   not) 7  to  8  cents   per   dozen. 

Cold-storage   butter 6  to  7  cents  per'pound. 

Butter  substitutes,  oleomargerine,   nutmargerine,  etc 5  to  6  cents  per  pound. 

NOTE. — The  maximum  margins  on  wheat  flour  and  mixed  flour  were  removed  December 
31,  1918. 

B.  REFINED  SUGAR. 

Rule  1.  Profit  on  sugar  purchased  from  refiner. — No  wholesale  dealer  in 
refined  sugar  who  purchases  such  sugar  from  the  producer  or  refiner,  direct 
or  through  a  broker,  shall  sell  such  sugar  at  an  advance  over  the  refiner's  list 
price  at  which  he  purchased  sugar  greater  than  the  normal  margin  charged 
by  wholesale  dealers  in  refined  sugar  in  the  same  locality,  or  such  margin  as 
may  hereafter  be  established  by  the  Food  Administration.  (Issued  Nov.  1, 
1917;  repealed  Feb.  1,  1919.) 

(This  rule  corresponds  to  special  rule  1,  series  B,  Governing  Wholesale  Dealers  in 
Sugar.) 

NOTR. — This  rule  applies  to  plantation  granulated  sugar. 


606  HISTORY  OF  PRICES   DURING  THE  WAR. 

Rule  2.  Profit  on  sugar  obtained  from  other  than  refiner. — It  will  be  con- 
sidered an  unreasonable  practice  if  two  or  more  wholesale  dealers  handle  the 
same  sugar  at  a  greater  total  margin  than  that  prescribed  by  rule  1.  No  whole- 
sale dealer  or  other  licensee  who  purchases  refined  sugar  from  any  person  other 
than  the  producer  or  refiner  shall  sell  such  sugar  to  a  retailer  or  to  a  person 
using  such  sugar  in  manufacturing  at  a  price  representing  an  advance  over 
the  producer's  or  refiner's  list  price  on  the  day  of  such  sale  greater  than  the 
advance  allowed  by  the  preceding  rule  to  a  wholesale  dealer  in  the  locality 
where  such  sale  occurs.  (Issued  Nov.  1,  1917;  added  to  June  15,  1918;  re- 
pealed Feb.  1,  1919.) 

(This  rule  corresponds  to  special  rule  2,  series  B,  Governing  Wholesale  Dealers  in 
Sugar.) 

Rule  3.  Retail  sales  must  be  made  at  not  more  than  reasonable  advance  over 
cost. — The  licensee  shall  sell  sugar  at  retail  at  not  more  than  a  reasonable 
advance  over  the  actual  purchase  price  of  the  particular  goods  sold,  without 
regard  to  the  market  or  replacement  value  at  the  time  of  such  sale.  (Issued 
Nov.  1,  1917;  repealed  Feb.  1,  1919.) 

E.  DRIED  BEANS  AND  DRIED  PEAS. 

Rule  1  (as  amended  July  24,  1918).  Future  dealing  in  new  crop  beans 
prohibited. — The  licensee  shall  not  buy  or  sell  new  crop  dried  beans  except  for 
seed,  or  for  the  Federal,  State,  county,  or  municipal  governments  or  for  the 
Government  of  any  nation  at  war  with  Germany,  before  September  1  of  the 
year  covering  such  new  crop  if  grown  in  the  United  States  of  America,  Japan, 
Manchuria,  China,  or  Asiatic  countries,  or  before  June  1  if  grown  in  South 
America,  Porto  Rico,  or  Mexico.  (Rule  issued  Nov.  1,  1917,  limited  dealing  in 
beans  grown  in  "the  United  States  changed  July  24,  1918,  to  include  beans 
grown  in  countries  noted  here ;  repealed  Dec.  3,  1918. ) 

NOTE. — This  rule  does  not  prohibit  a  licensee  from  guaranteeing  a  certain  price  for  a 
crop  to  be  planted  ;  however,  sales  against  such  an  arrangement  can  not  be  made  before 
September  1. 

Rule  2  (as  amended  July  24,  1918).  Future  dealing  in  new  crop  peas  pro- 
hibited.— The  licensee  shall  not  buy  or  sell  new  crop  dried  peas  grown  in  the 
United  States  of  America,  Japan,  Manchuria,  China,  or  Asiatic  countries, 
except  for  seed,  or  for  the  Federal,  State,  county,  or  municipal  governments 
or  for  the  Government  of  any  nation  at  war  with  Germany,  before  July  1  of 
the  year  covering  such  new  crop.  If  grown  in  South  America,  Porto  Rico,  or 
Mexico  such  new  crop  shall  not  be  sold  before  April.  1.  (Rule  issued  Nov.  1, 
1917,  limited  dealing  in  peas  grown  in  the  United  States,  changed  July  24,  1918, 
to  include  peas  grown  in  countries  noted  here ;  repealed  Dec.  3,  1918. ) 

NOTE. — While  this  rule  permits  the  guaranteeing  of  a  price  for  a  crop,  no  sales  can  be 
made  by  the  licensee  before  July  1. 

MAXIMUM  MARGINS. 

Under  Special  Rule  XI-A-5  speculation  in  dried  beans  or  dried  peas  is  prohibited. 

(Effective  Aug.  20,  1918.)  The  Food  Administration  will  regard  any  sales  of  dried 
beans  or  dried  peas  at  a  gross  margin  above  delivered  cost  (purchase  price  plus  freight) 
in  exc«ss  of  the  margins  indicated  in  the  following  table  as  prima  facie  evidence  of  a 
violation  of  the  statute  and  the  rules. 

These  margins  are  guides  only.  They  do  not  change  the  rules.  The  margins  of  profit 
are  still  limited  to  a  reasonable  advance  over  the  average  purchase  price  of  the  goods 
sold  without  regard  to  the  market  or  replacement  value,  and  a  smaller  margin  may  be 
considered  reasonable  where  the  licensee  has  a  lower  cost  than  customary  by  reason  of 
his  failure  to  perform  any  part  of  the  services  customarily  performed  by  dealers  of 
that  class. 

High  margins,  even  if  customary  during  prewar  periods,  are  not  justifiable  now. 
Unreasonable  margins  are  not  excused  by  lower  margins  on  other  transactions  in  the 
same  commodity  or  in  other  commodities. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


607 


Class. 

Services  rendered. 

Maxi- 
mum 
margin. 

Interpretations. 

1.  Importer 

Furnishes  letter  of  credit  and 

Per  cent. 
10 

Importers  who  buy  on  c.  i.  f.  terms  or 

2.  Elevator  or  clean- 
ing warehouse. 

3.  Bean  factor... 

buys  direct  for  import. 

Buys  from  grower,  elevates, 
cleans,  handpicks,  and  sacks. 

Buys  from  grower,  elevates,  re- 
cleans  and  sacks;  does  not 
handpick. 

Buvs  from  retail  elevator  (or 

12 
10 
5 

bank   guarantee   of  payment   after 
arrival  of  shipment,  or  who  do  not 
assume  the  direct  risk  of  buying  in 
foreign  countries,  fall  in  class  3  and 
are  entitled  only  to  maximum  margin 
of  profit  for  that  class. 
The  difference  between  the  selling  price 
and  the  actual  cost  on  a  handpicked 
or  recleaned  basis  should  be  used  in 
arriving  at  these  margins. 
These  margins  have  been  determined 
by  taking  the  average  cost  and  ex- 
pense of  operating  in  different  sec- 
tions of  the  country. 
Elevators  and  warehouses  which  buy 

importer)  and  finances  to 
destination. 
Buys  from  grower  and  has  re- 
cleaned  by  railroad  or  public 
warehouse. 

7 

as  agents  for  larger  concerns  and  do 
not  prepare  for  the  market,  are  not 
entitled  to  more  than  a  reasonable 
commission  for  the  services  rendered, 
which  must  be  included  in  the 
allowed  margin  of  his  principal. 

WHAT  RESALES  ARE  JUSTIFIABLE. 

General  rule  6. — The  licensee  in  selling  food  commodities,  shall  keep  such 
commodities  moving  to  the  consumer  in  as  direct  line  as  practicable  and  with- 
out unreasonable  delay.  Resales  within  the  same  trade  without  reasonable 
justification,  especially  if  tending  to  result  in  a  higher  market  price  to  the 
retailer  or  consumer,  will  be  dealt  with  as  an  unfair  practice. 

Service. — Any  transactions  that  savor  of  trading  in  which  a  profit  accrues 
to  the  dealer  without  corresponding  service  are  clear  violations  of  the  rule  and 
will  subject  the  offender  to  revocation  of  this  license  and  to  such  other  penalty 
as  the  law  provides. 

The  handling  of  dried  beans  and  dried  peas  by  wholesale  grocers,  including 
those  sometimes  referred  to  as  "  bean  jobbers  "  when  such  jobbers  are  not  lo- 
cated in  the  bean-producing  sections,  and  do  not  buy  from  or  finance  retail  ele- 
vators, is  dealt  with  in  the  circular  of  June  6,  1918,  on  "  Maximum  margins  on 
sales  by  wholesalers  to  retailers  and  by  merchandise  brokers;  and  justifiable 
resales  for  such  dealers."  The  contents  of  this  circular  are  also  to  be  found  in 
the  note  to  Rule  XI-A-5,  effective  June  15.  The  provisions  regarding  importers 
of  beans  in  the  circular  of  June  6  are  superseded  by  this  circular. 

Resales  between  bean  factors,  commonly  known  as  bean  jobbers,  located  in 
the  bean-producing  sections  who  buy  from  the  retail  elevators  and  finance  such 
stock  to  destination  are  prohibited  unless  the  sum  of  the  gross  profits  obtained 
by  such  factors  does  not  exceed  the  maximum  reasonable  profit  for  that  group. 

Resales  between  elevators  or  cleaning  warehouses  are  also  prohibited  unless 
the  sum  of  the  gross  profits  obtained  by  such  warehouse  does  not  exceed  the 
maximum  reasonable  profit  for  that  group. 

Elevators  and  importers  may  resell  to  bean  factors,  but  the  effect  of  the  re- 
sale rule  is : 

(1)  That  imported  beans  shall  in  no  event  reach  the  wholesaler  or  mer- 
chandise broker  class  dealt  with  in  the  circular  of  June  6  at  an  advance  of 
more  than  5  per  cent  over  the  price  received  by  the  importer,  plus  freight. 

(2)  That  domestic  beans  shall  reach  the  wholesaler  or  merchandise  broker 
class  dealt  with  in  the  circular  of  June  6  at  an  advance  of  not  more  than  5  per 
cent  (or  7  per  cent  as  the  case  may  be),  plus  freight,  over  the  price  received 
by  the  elevator. 

It  may  be  noted  that  by  the  provisions  of  the  circular  of  June  6,  after  the 
beans  reach  the  wholesale  grocery  or  merchandise  broker  class,  they  must  be 
sold  direct  to  retailers,  except  in  certain  specified  cases  where  one  resale  at  a 
small  margin  is  permitted. 

F.  DRIED   FRUITS. 

Rule  1.  New-crop  fruits  that  are  not  available  for  spot  delivery  not  to  be 
bought  or  sold  before  July  15. — The  licensee,  prior  to  July  15  of  the  year  in 


608  HISTORY   OF   PRICES   DURING  THE   WAR. 

which  new-crop  fruits  are  to  be  grown  and  packed,  shall  not  buy,  contract  to 
buy,  offer  for  sale,  or  have  outstanding  any  contract  of  sale  or  any  commit- 
ment for  sale  of  new-crop  fruits  not  available  for  spot  delivery.  A  commitment 
shall  include  all  tentative  or  conditional  orders  whether  definite  prices  are 
named  or  not.  (Rule  issued  Mar.  30,  1918,  forbade  dealing  in  dried  fruits 
before  May  1  of  year  grown.  Time  changed  to  June  1,  Apr.  30,  1918 ;  changed 
to  July  15,  May  24,  1918;  canceled  Jan.  10,  1919.) 

NOTE. — This  rule  and  the  following  rule  correspond  to  rules  4  and  5,  series  B,  Sup- 
plement 28,  which  became  effective  May  7,  1918,  and  were  amended  to  their  present 
form  May  24,  1918. 

G.  CANNED  PEAS,  CANNED  CORN,  CANNED  TOMATOES,  CANNED 
SALMON,  AND  CANNED  SARDINES. 

Rule  1.  Canned  goods  not  to  be  quoted  before  February  1 — The  licensee  shall 
not  quote  for  future  delivery  any  canned  peas,  canned  corn,  canned  tomatoes, 
canned  salmon,  or  canned  sardines  before  February  1  of  the  year  when  such 
products  are  to  be  canned.  (Issued  Dec.  20,  1917;  canceled  Jan.  10,  1919.) 

(This  rule  corresponds  to  special  rule  3,  series  B,  governing  wholesalers  and  retailers.) 

H.     GREEN  COFFEE. 

Rule  1  (as  amended  Dec.  5,  1918),  Licensees  entitled  to  reasonable  profit. — 
Licensees  in  selling  coffee,  which  is  owned  by  any  licensee,  spot  or  afloat,  on  or 
before  December  15,  1918,  shall  not  take  more  than  a  reasonable  profit  over  the 
cost  of  the  particular  coffee  sold,  provided  that  any  sale  of  spot  coffee  shall  be 
made  at  not  more  than  a  reasonable  profit  over  the  average  cost  of  his  entire 
stock  of  spot  coffee.  Each  growth  of  coffee  shall  be  averaged  separately.  Every 
invoice  or  contract  covering  the  sale  of  coffee  subject  to  this  rule  shall  be 
marked : 

"  The  seller  of  the  coffee  covered  by  this  invoice  or  contract  hereby  certifies 
that  same  has  been  sold  subject  to  special  rules  1,  2,  and  3  of  the  Food  Admin- 
istration." 

The  licensee  in  arriving  at  the  cost  of  such  coffee  shall  include  any  gain  or 
loss  resulting  from  any  actual  hedging  transaction  on  a  coffee  exchange.  For 
the  purpose  of  this  rule,  an  actual  hedging  transaction  on  a  coffee  exchange 
shall  only  include  transactions  in  which  the  sale  or  purchase  made  is  finally 
closed  or  offset. 

In  calculating  the  profit  permitted  by  this  rule  the  licensee  shall  not  include 
the  gain  or  loss  from  more  than  one  hedging  transaction  on  the  same  lot  or 
stock  of  coffee,  but  the  position  of  this  transaction  may  be  switched  from  one 
month  to  another,  provided  that  all  profits  or  losses  from  any  hedging  transac- 
tion and  all  facts  regarding  the  switching  of  any  hedge  from  one  month 'to  an- 
other are  included  in  the  licensee's  reports. 

The  licensee  shall  keep  any  speculative  account  of  the  coffee  exchange  en- 
tirely separate  from  such  hedging  transactions,  and  the  gain  or  loss  resulting 
therefrom  shall  not  be  considered  in  determining  the  cost  of  his  hedged  stock  of 
coffee.  (First  issued  Feb.  7,  1918;  amended  June  15  to  define  hedging  transac- 
tion more  in  detail ;  amended  July  24  and  Sept.  11  with  reference  to  coffee 
which  might  be  averaged  in  figuring  cost.  Canceled  Jan.  10,  1919.) 

NOTE. — The  above  rule  applies  only  to  coffee  owned  by  any  licensee,  spot  or  afloat,  on 
or  before  December  15,  1918. 

Rule  2  (as  amended  July  24,  1918).  Importer  limited  to  profit  of  5  per  cent. — 
For  the  purpose  of  rule  1  a  reasonable  profit  for  an  importer  shall  not  exceed 
5  per  cent  gross  margin  over  cost,  plus  any  brokerage  or  commission  actually 
paid,  and  the  usual  ex  ship  or  in  store,  and  shipping  charges  actually  incurred 
by  the  licensee  on  such  coffee.  If  drafts  against  purchase  are  drawn  in  pounds 
sterling,  only  the  actual  amount  paid  shall  be  used  in  figuring  the  cost. 

For  the  purposes  of  this  rule,  an  importer  is  one  who  buys  coffee  in  the 
country  of  origin,  or  coffee  in  transit  to  this  country,  irrespective  of  terms 
or  conditions  of  delivery,  and  who  resells  such  purchase  as  shipped,  in  any 
position,  as  a  whole  or  in  divided  quantities  without  selection  of  specified  chops. 
A  jobber  dealing  in  the  foregoing  manner  shall  be  considered  an  importer. 
(Issued  Mar.  9,  1918,  limiting  profit  to  2i  per  cent;  amended  July  24,  1918, 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  609 

limiting  profit  to  5  per  cent;  made  to  apply  only  to  coffee  owned  by  licensee 
on  or  before  Dec.  15,  1918,  by  note  added  Dec.  5,  1918 ;  canceled  Jan.  10,  1919. ) 
NOTE. — An  importer's  transaction  is  one  in  which  an  invoice  is  sold  practically  aa 
shipped.  For  example,  a  sale  of  450  bags,  more  or  less,  out  of  an  invoice  of  500  bags, 
in  order  to  enable  the  seller  to  obtain  the  profit  allowed  to  jobbers,  will  be  considered 
as  a  violation  of  the  regulations. 

Rule  3  (as  amended  July  24,  1918).  Jobber  limited  to  profit  of  7^  per  cent. — 
For  the  purposes  of  rule  1  a  reasonable  profit  for  a  jobber  shall  be  7$  per  cent 
gross  margin  over  cost,  such  cost  and  charges  to  be  computed  as  prescribed  ill 
rule  2.  A  jobber,  for  the  purpose  of  this  rule,  is  one  who  customarily  sells 
coffee  in  one  or  more  chops  to  wholesalers,  roasters,  or  other  licensed  green- 
coffee  dealers.  (Issued  Mar.  9,  1918,  limiting  profit  to  5  per  cent;  amended 
July  24,  1918,  limiting  profit  to  7^  per  cent,  made  to  apply  only  to  coffee  owned 
by  licensee  on  or  before  Dec.  15,  1918,  by  note  added  Dec.  5,  1918 ;  canceled  Jan 
10,  1919.) 

NOTE.. — The  prescribed  margin  of  profit  does  not  apply  to  sales  of  25  bags  or  less. 

Rule  4  (as  amended  July  24,  1918).  Resales,  with  certain  exceptions,  for- 
bidden.— The  licensee  in  selling  green  coffee  shall  keep  it  moving  to  the  con- 
sumer in  as  direct  a  line  as  practicable  and  without  unreasonable  delay. 
Resales,  especially  if  tending  to  result  in  a  higher  market  price  to  the  con- 
sumer, will  be  dealt  with  as  an  unfair  practice.  One  resale  from  one  importer 
to  another  is  permissible,  and  on  such  resale  the  gross  margin  of  profit  shall 
not  exceed  2£  per  cent  over  cost  plus  such  charges  as  are  stated  in  rule  2. 
One  resale  from  one  jobber  to  another  is  permissible,  and  on  such  resale  the 
gross  margin  shall  not  exceed  3f  per  cent  over  cost  plus  such  charges  as  are 
stated  in  rule  2.  (Issued  Mar.  9,  1918,  limiting  profit  in  sales  between  im- 
porters to  1|  per  cent  and  between  jobbers  to  2$  per  cent;  changed  July  24, 
1918,  to  21  per  cent  for  importers  and  3|  per  cent  for  jobbers;  made  to  apply 
only  to  coffee  owned  by  licensee  on  or  before  Dec.  15,  1918 ;  added  Dec.  5,  1918 ; 
canceled  Jan.  10,  1919.) 

NOTE. — More  than  one  resale  will  be  permitted  only  under  very  exceptional  conditions. 
The  Food  Administration  realizes  that  conditions  may  arise  where  sufficient  justification 
may  be  found  to  warrant  further  resales.  Such  resales,  however,  can  only  be  made  with 
the  permission  of  the  Food  Administration.  Full  consideration  for  the  issuing  of  such 
permission  will  be  given  when  sufficient  justification  can  be  shown. 

Rule  7.  Must  not  charge  more  than  the  customary  brokerage. — The  licensee 
shall  not  charge,  directly  or  indirectly,  a  commission  or  brokerage  on  the  sale 
of  green  coffee  in  excess  of  that  which  ordinarily  and  customarily  prevails, 
under  normal  conditions,  in  the  locality  in  which  the  broker's  business  is  con- 
ducted. (Issued  Mar.  9,  1918;  canceled  Jan.  10,  1919.) 

Rule  8.  Only  one  brokerage  permitted. — Brokers  shall  not  receive  more  than 
one  brokerage  on  any  sale,  nor  shall  they  receive  an  overage  except  where  by 
force  of  circumstances  they  may  have  become  principals  through  a  misunder- 
standing or  delay.  When  a  broker  closes  out  or  sells  coffee  upon  which  he 
receives  an  overage  he  must  send  to  the  buyer,  and  enter  in  his  reports  to  the 
Food  Administration,  full  particulars  regarding  such  transaction.  In  cases 
where  first-hand  dealers  (i.  e.,  importers,  jobbers,  or  licensees  holding  green 
coffee  on  commission)  employ  one  broker  as  their  exclusive  broker,  and  such 
goods  are  placed  to  the  interior  trade  through  a  local  broker  acting  there  as 
the  representative  of  the  sole  broker  of  the  principal,  the  licensee  under  rules 
2,  3,  and  4  may  include  under  the  item  of  brokerage  such  extra  brokerage  or 
commission  as  has  been  heretofore  customary  for  the  local  broker.  All  invoices 
rendered  by  licensees  to  buyers  of  green  coffee  shall  state  the  entire  amount 
of  brokerage  paid,  if  any,  on  the  transaction,  and  included  in  the  price  paid  by 
the  buyer.  ( Issued  Mar.  9,  1918 ;  canceled  Jan.  10,  1919. ) 

NOTE. — In  the  green-coffee  trade  it  has  been  customary  for  brokers,  representing 
exclusively  first-hand  dealers,  to  handle  these  accounts  through  outside  brokers  for  the 
interior  trade,  and  these  first-hand  dealers  cover  the  cost  to  them  of  these  outside 
brokers  by  an  additional  price,  secured  from  the  purchaser.  As  this  custom  has  been 
long  established,  the  Food  Administration,  pending  further  notice,  will  permit  it  to 
continue,  but  requires  that  the  full  amount  of  all  commissions  paid  on  a  transaction 
shall  be  shown  on  the  coffee  invoices  rendered  by  the  seller  to  the  buyer  in  every  case. 

ROASTED  COFFEE. 

Although  roasted  coffee  itself  has  not  been  licensed,  it  must  be  carefully 
noted  that  all  persons  selling  roasted  coffee  are  subject  to  the  food-control  act 
of  August  10,  1917,  and  -that  this  law  expressly  forbids  unreasonable  or  exces- 

125547°— 20 39 


610 


HISTORY   OF   PEICES   DURING   THE   WAR. 


sive  charges.  If  it  is  found  that  the  trade  is  violating  this  law  as  to  reason- 
able profits  upon  roasted  coffee,  prompt  action  will  be  taken  and  the  Food 
Administration  will  also  find  it  necessary  to  place  roasted  coffee  under  license. 

J.   SPECIAL    REGULATIONS     GOVERNING     DISTRIBUTORS     OF     OLEO- 
MARGARINE   OR    OTHER   BUTTER    SUBSTITUTES. 

Rule  1  (new,  Oct.  25,  1918).  Oleomargarine  must  not  be  sold  at  retail  at  more 
than  reasonable  advance  over  cost. — The  licensee  dealing  in  oleomargarine  or 
other  butter  substitutes  at  retail  shall  not  sell  at  more  than  a  reasonable  ad- 
vance over  cost  without  regard  to  market  or  replacement  value  at  the  time  of 
sale.  Cost  shall  include  purchase  price  plus  transportation  charges,  if  any. 
The  licensee  may  average  the  cost  of  all  oleomargine  or  other  butter  substitutes 
of  the  same  kind  and  grade  in  his  possession  at  the  point  from  which  the  sale  is 
made  which  has  not  already  been  contracted  to  be  sold,  and  may  take  such  aver- 
age cost  as  the  cost  of  any  particular  lot.  When  new  lots  are  added  and  a  new 
average  calculated  the  licensee  shall  include  in  the  new  averaging  all  stock 
remaining  on  hand  of  lots  already  averaged  at  the  average  cost  of  such  lots 
previously  determined.  If  the  cost  of  any  oleomargine  or  butter  substitutes  is 
averaged  the  cost  of  all  such  products  must  be  averaged.  When  costs  are  aver- 
aged the  licensee  must  keep  a  record  of  the  manner  in  which  such  average  has 
been  arrived  at.  (Repealed  Feb.  1,  1919.) 

NOTE. — The  United  States  Food  Administration  will  regard  any  advance  in  excess  of 
5  cents  to  6  cents  per  pound  over  cost  as  unreasonable  and  as  evidence  of  violation  of 
the  above  rule.  The  5  cents  per  pound  represents  the  maximum  margin  for  stores  con- 
ducted on  the  cash  and  carry  or  no  service  plan,  while  6  cents  per  pound  is  tlie  maximum 
margin  for  the  extra  service  stores  extending  credit  and  delivery. 

In  determining  margins  at  5  cents  and  6  cents  per  pound  on  oleornarjrme  with  the 
fractional  costs  in  favor  of  the  dealer,  the  United  States  Food  Administration  has  given 
due  consideration  to  the  rising  costs  of  operation  which  must  be  met  by  the  dealer. 

Retailer  may  have  benefit  of  fractional  cost  on  ani/  transaction. — Retailers  whose  de- 
livered terminal  costs  figure  in  fractions  may  have  the  benefit  of  such  fractional  costs. 
Tor  example,  if  oleomargine  costs  at  terminal  delivery  32 i  cents  per  pound,  the  selling 
price  may  be  figured  as  follows  : 

CASH  AND  CAHIlY  STORES. 


Amount  of  sale. 

Cost. 

Margin. 

Total. 

Fraction 
added. 

Maximum 
selling 
price. 

1  pound                        

Cents. 
32J 

Cents. 
5 

Cents. 
37| 

Cents. 
J 

Cents. 
3? 

65 

10 

75 

Xonc. 

75 

3  pounds       .                 

97i 

15 

ii2i 

i 

113 

would  be  1 


The  maximum  selling  price  for  the  extra  service  or  credit  and  delivery  stor< 
cent  per  pound  higher. 

Rule  2  (new,  Oct.  17,  1918).  The  manufacture  and  sale  of  prints  of  oleomar- 
garine or  other  butter  substitutes  weighing  less  than  1  pound  prohibited. — On 
and  after  January  1,  1919,  no  licensee  shall  manufacture  or  sell  units  of  oleo- 
margine or  any  other  butter  substitute  in  print  form  that  weighs  less  than  one 
pound,  provided  that  this  rule  shall  not  prevent  a  retailer  from  cutting  a  unit 
weighing  1  pound  or  more,  and  selling  a  portion  thereof  to  a  consumer.  (Re- 
pealed Nov.  25,  1918. ) 

L.     CLEAN  RICE. 

Hule  2.  Quotations  of  imported  clean  rice  by  the  pound  only. — The  licensee 
shall  quote,  buy,  and  sell  all  imported  clean  rice  by  the  pound  only.  (Repealed 
Feb.  1,  1919.) 

NOTE. — This  rule  applies  to  imported  clean  rice  which  is  held  for  export. 

XII.  BROKERS    AND    AUCTIONEERS    OF    LICENSED    NONPERISH- 
ABLE  FOOD  COMMODITIES. 

A  broker  or  auctioneer  in  a  transaction  eoiu-e  ruing  any  licensed  food  com- 
modity is  responsible  for  any  violation  by  the  principal  of  the  regulations  gov- 
erning such  transaction.  Brokers  and  auctioneers  should,  therefore,  familiarize 
themselves  with  the  general  regulations  and  any  special  regulations  governing 
principals  for  whom  they  act. 

A  list  of  the  special  rules  issued  will  be  found  on  page  3  of  Pamphlet  No.  I 
(General  License  Regulations). 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  611 

Brokers  and  auctioneers  ,in  all  licensed  nonperishable  food  commodities 
must  also  conform  to  the  following  brokers'  rules : 

Rule  1.  Commission  or  brokerage  charges  limited. — A  licensee  shall  not  charge 
directly  or  indirectly  a  commission  or  brokerage  on  the  sale  of  food  commod- 
ities in  excess  of  that  which  ordinarily  and  customarily  prevails  under  normal 
conditions  in  the  locality  in  which  the  broker's,  conimssion  merchant's,  or 
auctioneer's  business  is  conducted  and  in  the  particular  branch  of  trade  in 
question. 

Rule  2.  Prompt  remittance  required. — The  licensee  shall  remit  promptly  fol- 
lowing the  sale  of  food  commodities  received  on  consignment  for  sale  or  dis- 
tribution, and  shall  render  to  the  consignor  an  account  showing  the  true  sales 
and  with  charges  only  for  services  actually  performed  and  expenses  actually 
incurred  by  the  licensee.  (Issued  Nov.  1,  1917,  repealed  Feb.  1,  1919.) 

NOTE. — A  commission  merchant  can  not  divide  his  commission  with  the  buyer  unless 
he  shows  on  the  account  of  sales  rendered  to  the  consignor  that  he  has  done  so. 

Rule  3.  Charging  of  both  brokerage  and  overage  prohibited. — The  licensee 
sluill  not  charge  or  receive  for  himself,  on  the  sale  of  any  food  commodities, 
both  a  commission  or  brokerage  and  an  overage  or  profit.  (Issued  Nov.  1, 
1917;  repealed  Feb.  1,  1919.) 

Rule  4.  Sales  to  self  forbidden  without  written  consent  of  principal. — The 
licensee  shall  not  directly  or  indirectly  sell  consigned  food  commodities,  or 
food  commodities  with  the  sale  of  which  on  commission  he  is  intrusted,  to 
himself  or  to  anyone  connected  with  his  business  without  the  written  permis- 
sion of  his  principal. 

Rule  5.  Only  one  brokerage  on  sugar  permitted. — No  licensee  shall  charge  a 
-commission  or  brokerage  on  any  sugar  on  which  one  brokerage  or  commission 
has  already  been  charged.  (Issued  Nov.  1.  1917;  repealed  Feb.  1,  1919.) 

Rule  6  (as  amended  Aug.  15,  1918;  effective  Aug.  20,  1918).  Commissions  must 
not  be  split  with  buyer. — The  licensee  may  split  with  other  brokers'  commis- 
sions or  brokerage  received  on  the  sale  of  food  commodities,  but  shall  not  split 
such  commissions  or  brokerage  with  the  buyer  of  the  food  commodities,  or  any 
employee  of  the  buyer.  (Issued  Nov.  1,  1917,  as  to  sugar;  changed  Aug.  20, 
1918,  to  cover  "food  commodities,"  as  noted  here;  repealed  Feb.  1,  1919.) 

NOTE. — The  payment  by  a  broker  of  charges  incurred  by  him  for  telephone  and  tele- 
graph messages  received  by  him  from  a  buyer  does  not  constitute  the  splitting  of  his 
commissions  with  the  buyer.  Money  so  paid  out  is  an  expense  of  the  brokerage  busi- 
ness. 

MARGINS   FOR    BROKERS   WHO   BUY  AND    SELL   FOR   THEIR   OWN   ACCOUNT. 

Subject  to  the  provisions  of  general  rules  CT  7.  and  8  and  the  above  rules  governing 
commission  merchants  and  brokers,  brokers  may  in  proper  and  necessary  transactions 
buy  and  sell  for  their  own  account.  Transactions  of  this  kind  should  be  confined  to  the 
smallest  possible  volume,  and  in  every  case  must  be  justified  by  the  necessity  of  com- 
pleting cars  or  dividing  carloads  among  smaller  buyers ;  such  merchants  engaged  in 
this  business  should  be  guided  by  the  following-suggested  margins,  which  are  to  be  re- 
garded as  maximum  gross  profits,  but  are  not  permitted  unless  corresponding  service 
is  rendered  : 

All  flour    (except  wheat  and   rye  flour),   hominy,   grits,   corn   meal,   oatmeal,    rolled 

oats,   beans,   rice,   etc 4 

Licensed  cereals  in  packages,  licensed  canned  goods,  licensed  dried  fruits 5 

These  margins  shall  be  inclusive  of  any  brokerage  received. 

In  every  case  where  a  broker  sells  for  his  own  account  any  nonperishable  goods  that 
he  has  purchased  from  a  particular  principal,  and  has  received,  or  is  entitled  to  receive, 
a  brokerage  on  such  goods,  he  must  deduct  such  brokerage  before  fixing  his  margin  of 
profit  as  a  jobber. 

XIV.  SUGARS  AND  SIRUPS. 

A.  SPECIAL  REGULATIONS  GOVERNING  DEALERS  IN  GLUCOSE,  RE- 
FINERS' SIRUPS,  MAPLE  SIRUP,  SORGHUM,  CANE  JUICE  SIRUP 
CENTRIFUGAL  MOLASSES.  OPEN-KETTLE  MOLASSES,  WEST  INDIA 
MOLASSES,  AND  BLACKSTRAP  MOLASSES,  AND  MANUFACTURERS 
AND  MIXERS  OF  MIXED  SIRUPS  AND  MIXED  MOLASSES. 

(Effective  Nov.  7,  1918.) 

NOTE. — The  following  regulations  do  not  apply  to  established  wholesale  grocers 
handling  sirups  or  molasses  through  customary  trade  channels  for  the  hcusehold  and 
bakers  trade.  Such  wholesale  grocers  are  governed  by  Regulations  No.  XI  and  the 
margins  and  resale  pi-ovisions  there  prescribed.  These  regulations  do  apply  to  all  other 
dealers  in  pure  sirups  or  molasses,  whether  sold  in  original  packages  or  repacked;  and 
to  all  licensees  who  mix,  blend,  or  process  in  any  way  sirups  consisting  in  whole  or  ID 
part  of  sirups,  glucose,  or  molasses  of  any  kind. 


612  HISTOEY   OF   PRICES   DURING   THE   WAR. 

Rule  1.  Reasonable  profits  prescribed. — The  licensee  without  regard  to  market 
or  replacement  value  at  the  time  of  such  sale  shall  sell  glucose,  refiner's  sirups, 
maple  sirup,  sorghum,  cane-juice  sirup,  centrifugal  molasses,  open-kettle  mo- 
lasses, West  India  molasses,  blackstrap  molasses,  and  all  mixed  sirups  and 
mixed  molasses  at  not  more  than  a  reasonable  advance  over  the  average  purchase 
price  of  all  lots  of  the  same  grade  and  size,  of  the  same  commodity  or  the  in- 
gredients thereof,  in  his  possession  or  invoiced  to  him  not  contracted  to  be 
sold.  The  licensee  shall  keep  a  record  of  the  manner  in  which  such  average 
has  been  arrived  at,  and  he  shall  take  as  the  cost  of  all  stock  remaining  on 
hand  from  lots  already  averaged  the  average  cost  previously  arrived  at.  In 
selling  commodities  not  yet  invoiced  to  him  he  shall  sell  at  not  more  than  a 
reasonable  advance  over  the  actual  purchase  price  to  him  of  all  lots  of  the 
same  grade  and  size  of  the  same  commodity,  or  the  ingredients  thereof,  pur- 
chased by  him  but  not  yet  invoiced  to  him.  ( Issued  Nov.  7,  1918 ;  canceled 
Jan.  10,  1919.) 

NOTE. — Margins  for  dealers  in  pure  refiners'  sirups  or  glucose. — Under  the  above 
rule  the  Food  Administration  will  consider  any  gross  margins  above  delivered  cost  in 
excess  of  those  listed  below  taken  by  dealers  in  pure  refiners'  sirups  or  glucose,  as 
prima  facie  evidence  of  a  violation  of  the  statute  and  this  regulation.  A  violation  of 
these  margins  will  therefore  be  considered  cause  for  the  revocation  of  a  dealer's  license. 

(a)  Where  glucose  or  refiners'  sirup  is  sold  by  a  dealer  in  car  lots  (including  mixed 
cars),  not  to  exceed  5  per  cent. 

(6)  Where  glucose  or  refiners'  sirup  is  sold  by  a  dealer  in  less  than  car  lots  to  bakers, 
mixers,  or  manufacturers,  not  to  exceed  12  to  15  per  cent. 

(C)  Where  glucose  or  refiners'  sirup  is  sold  to  a  wholesale  grocer  under  the  provision 
of  rule  2  .following,  in  less  than  car  lots,  not  to  exceed  7i  per  cent. 

(d)  Where  the  dealer  breaks  original  packages  he  may  add  to  his  cost  the  cost  of  the 
new  packages  plus  actual  cost  of  such  packing,  in  no  case  to  exceed  5  per  cent. 

The  margins  named  are  large  enough  to  include  all  ordinary  carrying  charges.  If 
general  conditions  should  later  necessitate  the  carrying  of  goods  for  a  longer  period  than 
usual,  further  consideration  will  be  given  to  this  feature. 

The  above  margins  do  not  justify  the  taking  of  a  profit  greater  than  was  taken  by  the 
licensee  in  prewar  times.  A  large  part  of  the  commodities  covered  by  this  rule  are 
dealt  with  in  large  quantities,  and  it  is  quite  possible  that  dealers  who  handle  them  in 
such  quantities  will  receive  an  unreasonable  profit  if  they  take  the  full  maximum 
margin.  In  such  cases  they  should  continue  to  sell  at  somewhat  lower  margins.  Dealers 
in  refiners'  sirups  and  glucose  are  also  subject  to  the  6  per  cent  profit  limitation 
following : 

Profits  for  dealers  and  mixers  of  sirup,  f/lucose,  and  molasses. — The  Food  Administra- 
tion will  consider  ,a  net  earning  of  more  than  6  per  cent  upon  the  gross  sales  of  pure 
and  mixed  sirups,  glucose,  and  molasses  by  any  dealer  in  sirups  as  above  defined,  or  by 
any  sirup  mixer  or  blender,  to  be  prima  facie  evidence  of  a  violation  of  the  rule  which 
prohibits  the  taking  of  unreasonable  profits  (general  rule  l-A-5).  This  percentage  will 
be  calculated  for  the  semiannual  periods  making  up  the  licensee's  fiscal  year.  The 
Federal  income  and  excess-profits  taxes  may  not  be  deducted,  but  all  other  taxes  may  be 
considered  as  expenses.  The  limitation  does  not  modify  or  abrogate  the  general  prin- 
ciples contained  in  the  Food  Administration  regulations  that  a  licensee  should  not  earn 
more  than  a  reasonable  net  profit  on  its  capital  invested. 

Blackstrap  molasses  and  refiners'  sirups  prices. — The  following  maximum  prices  have 
been  named  for  refiners'  sirups  and  blackstrap  molasses  sold  by  the  refiner  or  dealer 
in  tank  cars  and  based  on  the  cost  of  imported  raw  sugar  and  domestic  beet  manufacture : 


Per  gallon 
in  barrels. 

Per  gallon 
in  bulk. 

Refiners'  sirups  highest  grade  (fancy  filtered)  .                                     

Cents. 

55 

Cents. 
50 

40 

35 

Refiners'  sirups  low  grade  (unfiltered)..                                                 

30 

25 

Blackstrap  molasses.  .. 

23 

18 

The  maximum  prices  named  also  apply  to  imported  blackstrap.  These  prices  are  f.  o.  b. 
cars  at  seaboard  point  or  point  of  production,  net  cash  in  10  da~ys  without  discount.  They 
include  brokerage,  and  if  sirups  or  molasses  are  distributed  in  tank  cars  they  include  the 
margin  allowed  to  dealer,  so  that  no  dealer  may  sell  blackstrap  molasses  in  tank  cars  at 
more  than  18  cents  plus  freight  and  tank-car  charges.  Where  blackstrap  molasses  or 
sirups  are  distributed  in  barrels,  the  dealer's  margins  named  may  be  added  to  the  maxi- 
mum price. 

Where  sirups  are  distributed  in  packages  smaller  than  barrels,  the  packer  may  add  to 
the  bulk  price  the  actual  cost  of  such  packages. 

Rule  2.  Resale  of  glucose  and  refiners'  sirups  limited.— The  licensee  shall  not 
resell  pure  glucose  or  pure  refiners'  sirups  except  (1)  to  a  manufacturer,  baker, 
or  mixer  using  such  article  in  his  manufacture,  (2)  to  a  retail  grocer  or  con- 
sumer, (3)  to  wholesale  grocers  under  one  of  the  following  circumstances: 

A.  Continuous  service. — The  seller  may  customarily  and  continuously  serve  in-  less 
than  carload  lots  wholesale  grocers  who  are  serving  retail  grocers  but  who  are  unable  fox- 
some  sufficient  and  legitimate  reason  to  purchase  direct  from  the  source  of  supply. 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES.  613 

B.  Carload  buy-ing. — A  sirup  dealer  may  enjoy  the  benefit  of  carload  rates  from  distant 
points  and   sell   to  smaller  wholesale  grocers  who  are  unable  to  buy   the  commodity  in 
carload  lots. 

C.  Warehousing. — A    sirup    dealer    may    continuously    and    customarily    furnish     cold- 
storage    or    other    warehousing    service    and    sell    to    wholesale    grocers    who    have    not 
adequate  facilities  of  that  character. 

D.  Surplus    stocks.- — A    sirup   dealer    may    dispose   of    surplus   stocks   bought,    not   for 
speculation  but  in  good  faith,  for  the  reasonably  anticipated  requirements  of  his  business 
under  the  rules  and  regulations  and  which  he  finds  himself  unable  to  dispose  of  to  his 
regular  customers.     The  fact  that  such  goods  have  not  been  warehoused  by  such  dealer 
will  be  regarded  as  prima  facie  evidence  that  they  were  not  bought  in  good  faith. 

No  person  who  purchases  glucose  or  refiners'  sirups  from  a  dealer,  except  a 
wholesale  or  retail  grocer  buying  under  subdivisions  (2)  or  (3)  above,  shall 
resell  such  glucose  or  sirup  without  the  written  permission  of  the  United  States 
Food  Administration.  (Issued  Nov.  7,  1918;  repealed  Dec.  17,  1918.) 

NOTE. — Wholesale  grocers  purchasing  from  a  dealer  are  forbidden  to  resell,  except  to 
retailers,  manufacturers,  or  consumers,  under  the  wholesale  grocers'  regulations  (No.  XI) 
and  are  limited  to  a  margin  of  12  per  cent. 

.  Permission  to  resell  will  be  given  in  proper  cases  upon  the  condition  that  no  person 
from  whatever  source  he  buys  shall  sell  glucose  or  refiners'  sirups  in  bulk  at  an  advance 
over  the  manufacturer's  price  of  the  particular  lot  sold  greater  than  that  permitted  to 
a  single  dealer  plus  actual  freight. 

Sirup  mixers  may  sell  their  mixed  sirups  and  molasses  to  any  wholesale  grocer. 

XV.  SPECIAL  REGULATIONS  GOVERNING  ALL  DISTRIBUTORS  OF 
FRESH  FRUITS  AND  VEGETABLES. 

Rule  9.  Terms  to  be  included  in  every  contract  unless  expressly  agreed  other- 
wise.— The  licensee  shall  include  in  every  contract  for  the  sale  of  fresh  fruits 
and  vegetables  to  be  shipped  by  a  common  carrier  the  following  terms,  and 
these  terms  shall  be  understood  as  included  in  every  such  contract  between 
licensees,  even  though  not  expressly  stated ;  provided,  however,  that  the  said 
terms  may  be  varied  by  express  agreement  in  writing.  (Issued  Jan.  28,  1918; 
repealed  Dec.  10,  1918.) 

TERMS    OF   CONTRACT. 

A.  The  seller  shall  be  responsible  for  and  reimburse  the  buyer  for  any  failure  of  the 
goods  to  conform  to  the  grade,   quality,  or  condition   specified  in   the  contract  of  sale, 
except  that  all  sales  made  f.  o.  b.  point  of  origin  shall  be  construed  to  mean  that  the 
buyer  assumes  all  risks  of  damage  in  transit  not  caused  by  the  shipper  whether  there 
is  a  bill  of  lading  to  the  order  of  the  seller  or  not. 

B.  The  shipment  shall  be  deemed   to   have   reached   destination   when   placed   on   any 
railroad   team   track  or   private   unloading   track   or  where   awaiting   consignee's   order 
for  placing  on  such  team   or  private  unloading  track.     The  burden   of  locating  a  ship- 
ment on  such  arrival  shall  be  on  the  consignee,  provided  that  the  consignor  has  billed 
the  shipment  with  proper  instructions  as  to  the  railroad  notifying  the  consignee.     The 
failure  of  the  railroad  to  notify  the  consignee  will  not  be  construed  as  releasing  the 
consignee  from  his  obligations  to  the  consignor,   provided   proper  advice  as  to  the  car 
number  has  been  given  to  the  consignee  by  the  consignor.     But  if   the  consignee  uses 
every  reasonable  effort  to  locate  a  car  and  fails,  he  shall  not  be  responsible  for  failing 
to  learn  of  its  arrival. 

NOTES. — The  rule  issued  as  series  B,  special  rule  13,  effective  January  28,  1918,  is 
amended  by  the  above  rule. 

This  rule  applies  to  the  sale  of  cars  in  transit,  provided  the  seller  advises  the  buyer 
that  the  car  is  in  transit,  the  date  of  shipment,  and  if  possible,  where  it  is  located. 

NOTE  TO  RULES  3  TO  9,  INCLUSIVE. — The  above  rules  have  been  prepared  after  con- 
ference with  representatives  of  those  engaged  in  the  business  of  shipping  and  receiving 
perishable  food  commodities,  and  have  been  based  on  recommendations  from  them  in 
order  to  meet  a  condition  which  has  resulted  in  great  waste  of  fresh  fruits  and  vege- 
tables throughout  the  country.  The  rules  are  designed  to  prevent  delay  in  unloading 
the  shipment  of  goods  contrary  to  contract,  and  the  resulting  traffic  congestion  and 
food  waste. 

It  is  essential  that  all  licensees  should  cooperate  in  good  faith  with  the  Food  Ad- 
ministration to  avoid  improper  shipments,  rejections,  and  disputes,  and  to  arrange 
quickly  for  prompt  release,  handling,  or  unloading  of  the  goods  involved,  and  to  sub- 
mit any  dispute  promptly  to  arbitration.  It  is  strongly  recommended  that  contracts 
for  the  sale  of  fresh  fruits  and  fresh  vegetables,  be  definite  as  to  the  quality  and  grade 
of  goods  and  terms  of  sale  and  delivery,  and  be  evidenced  by  a  proper  memorandum 
in  writing.  The  Food  Administration  will  consider  the  certificate  of  any  food-products 
inspector  of  the  Bureau  of  Markets  of  the  United  States  Department  of  Agriculture 
as  prima  facie  evidence  of  the  condition  of  the  goods.  If  no  such  inspector  is  available, 
great  weight  will  be  attached  to  inspection  by  expert  officials  of  trade  organizations. 
Where  no  official  inspectors  are  available,  due  weight  will  be  given  to  the  judgment 
of  such  unofficial  experts  as  may  have  made  inspection  or  are  designated  or  approved 
by  the  Food  Administration. 


614  HISTORY   OF  PEICES   DURING  THE   WAR. 

In  all  cases  submitted  to  arbitration  or  settlement  where  the  shipment  is  made,  draft, 
bill  of  lading  attached,  the  consignor  should  direct  the  bank  holding  his  draft  to  retain 
the  proceeds  thereof  and  to  distribute  the  same  according  to  the  result  of  the  final 
determination.  Thereupon  the  consignee  should  pay  said  draft  and  release  the  bill  of 
lading. 

In,  the  case  of  commodities  where  it  is  customary  to  assort  or  recondition,  and  where 
necessary  to  preserve  food  values  and  prevent  waste,  fresh  fruits  and  vegetables  should 
be  assorted  or  reconditioned  by  the  consignee  upon  the  consignor's  request  to  recondi- 
tion and  his  agreement  to  arrange  for  the  payment  of  properly  substantiated  claims. 

B.  ADDITIONAL    SPECIAL    REGULATIONS    GOVERNING    COMMISSION 
MERCHANTS,    BROKERS,    AND   AUCTIONEERS    DEALING    IN    FRESH 
FRUITS  OR  FRESH  VEGETABLES. 

Rule  1.  Commission  or  brokerage  not  to  be  unreasonable  or  discriminatory. — 
The  licensee  shall  not  charge  directly  or  indirectly  an  unjust,  unreasonable, 
discriminatory,  or  unfair  commission  or  brokerage  on  the  sale  of  fresh  fruits 
or  fresh  vegetables.  (July  10,  1918 ;  repealed  Dec.  10,  1918.) 

NOTE. — The  Food  Administration  in  enforcing  this  rule  will  insist  that  any  proposed 
increase  in  rates  be  submitted  to  the  local  Federal  food  administrator  and  that  the  reason 
for  any  increased  rate  over  the  prewar  normal  be  justified  to  him,  subject  to  the  general 
supervision  of  the  United  States  Food  Administration  before  such  increased  rate  is  put 
into  effect. 

This  rule  was  formerly  included  in  series  B,  general  rule  5,  governing  all  licensees  as 
issued  November  1,  1917. 

Rule  2.  Prompt  remittance  and  proper  account  of  sales  to  be  rendered. — The 
licensee  shall  remit  promptly  following  the  sale  of  fresh  fruits  or  vegetables 
received  on  consignment  for  sale  or  distribution,  and  shall  render  to  the  con- 
signor an  account  showing  the  true  sales  and  with  charges  only  for  services 
actually  performed,  and  expenses  actually  incurred  by  the  licensee.  (Issued 
Nov.  1,  1917,  as  to  "  food  commodities  "  ;  repealed  Dec.  10,  1918.) 

NOTE. — This  ruie  is  jn  conformity  with  special  rule  2,  of  series  B,  issued  November  1, 
1917. 

From  November  1,  1917,  to  April  16,  1918,  the  rule  governing  all  commission  merchants, 
brokers,  and  auctioneers  which  limited  their  charges  to  "  *  that  which  ordinarily 

and    customarily    prevails    under   normal   conditions    in    the   locality    in   which 
their  business  is  conducted     *     *      *  "  applied  to  these  dealers  in  perishables. 

XVI.  DISTRIBUTORS  OF  FRESH  FISH  AND  FROZEN  FISH. 

C.  ADDITIONAL    SPECIAL    REGULATIONS    GOVERNING    COMMISSION 
MERCHANTS  AND  BROKERS  DEALING  IN  FRESH  FISH  OR  FROZEN 
FISH. 

Rule  1.  Commission  or  brokerage  not  to  be  unreasonable  or  discriminatory.1 — 
The  licensee  shall  not  charge  directly  or  indirectly  an  unjust,  unreasonable, 
discriminatory,  or  unfair  commission  or  brokerage  on  the  sale  of  fresh  fish 
or  frozen  fish.  (Issued  Aug.  24,  1918;  repealed  Dec.  17,  1918.) 

NOTE. — The  Food  Administration  in  enforcing  this  rule  will  insist  that  any  proposed 
increase  in  rates  be  submitted  to  the  local  food  administrator  and  that  the  reason  for 
any  increased  rate  over  the  prewar  normal  be  justified  to  him,  subject  to  the  general 
supervision  of  the  United  States  Food  Administration  before  such  increased  rate  is  put 

This  rule  was  formerly  included  in  series  B,  general  rule  5,  governing  all  licensees  as 
issued  November  1,  1917. 

Rule  2.  Prompt  remittance  and  proper  account  of  sales  to  be  rendered. — The 
licensee  shall  remit  promptly  following  the  sale  of  fresh  fish  or  frozen  fish  re- 
ceived on  consignment  for  sale  or  distribution,  and  shall  render  to  the  consignor 
an  account  showing  the  true  sales  and  with  charges  only  for  services  actually 
performed,  and  expenses  actually  incurred  by  the  licensee.  (Issued  Nov.  1, 
1917,  as  to  "  food  commodities  " ;  repealed  Dec.  17,  1918. ) 

NOTE. — This  rule  is  in  conformity  with  special  rule  2,  of  series  B,  issued  November 
3,  1917, 

Rule  3.  Agent  not  to  buy  from  principal  unless  noted  on  account  of  sales. — 
The  licensee  shall  not  directly  or  indirectly  sell  consigned  fresh  fish  or  frozen 
fish  or  such  commodities  with  the  sale  of  which  on  commission  he  is  entrusted, 

1  From  Nov.  1,  1917,  to  Apr.  16,  1918,  the  rule  governing  all  commission  merchants, 
brokers,  and  auctioneers,  which  limited  their  charges  to  "  *  *  *  that  which 
ordinarily  and  customarily  prevails  under  normal  conditions  in  the  locality  in 
which  *  *  their  business  is  conducted  *  *  applied  to  these  dealers  in 

perishables. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  615 

to  himself  or  to  anyone  connected  with  his  business,  unless  he  notes  the  facts  of 
such  transaction  on  the  account  of  sales.  (Issued  Nov.  1,  1917,  as  to  "food 
commodities";  repealed  Dec.  17,  1918.) 

NOTE. — This  rule  is  in  conformity  with  special  rule  4,  series  B,  issued  November 
1,  11)17. 

When  a  licensee  sells  to  himself  or  to  anyone  connected  with  his  business,  he  must 
clearly  show  on  the  account  of  sales  that  he  himself  bought  the  fish  and  also  clearly 
show  the  quantity  and  at  what  price  they  were  taken  over. 

RECOGNIZED  FUNDAMENTALS  APPLYING  TO  THE  STORING  AND  DISTRIBUTION 

OF   FROZEN    FISH. 

Storers  of/  frozen  fish,  whether  storing  at  the  producing  districts  or  in  the  dis- 
tributing markets,  perform  an  important  function  in  preserving  the  overproduction  of 
the  various  seasonal  varieties  for  consumption  during  periods  of  scant  production — 
i.  e.,  the  winter  months. 

They  are  a  direct  and  potent  aid  in  encouraging  and  fostering  the  production  of  the 
fisheries  by  enabling  the  various  producing  units  to  operate  steadily  and  at  full  efficiency. 

Broad  differences  in  the  first  costs  of  frozen  fish  must  prevail  generally,  affected  as 
they  are  by  the  uncertainties  surrounding  production,  influence  of  water  temperatures, 
storms,  feed  conditions,  and  many  other  natural  factors  incident  to  the  industry. 

The  period  of  marketability  is  limited  to  the  cold-weather  months.  The  pack  of  any 
one  variety  must  be  sold  in  competition  with  the  total  pack  of  all  kinds  of  frozen  fish 
throughout  the  country  aggregating  over  a  score  of  important  varieties  and  many 
miscellaneous  varieties.  Marketing  must  also  be  carried  on  in  competition  with  the 
daily  supplies  of  fresh-caught  fish,  which  fluctuate  widely  during  the  winter  months. 

No  satisfactory  determination  of  total  storage  stocks  and  average  costs  on  most  of 
the  varieties  of  frozen  fish  can  be  reached  until  after  the  completion  of  the  fall  runs. 

Storers  of  frozen  fish  and  distributors  must  necessarily  contend  with  these  complex 
and  uncertain  factors.  The  business  is  so  speculative  in  its  nature  and  so  variable  in 
its  results  from  season  to  season  that  ordinary  methods  of  estimating  margins  of  profit, 
whether  upon  particular  varieties  or  the  business  as  a  whole  are  difficult  of  application. 

The  practice  of  the  original  storers  in  selling  portions  of  their  pack  of  particular 
varieties  in  advance  of  the  termination  of  the  season  of  flush  production  is  a  natural 
outgrowth  of  the  uncertainty.  It  is  a  safeguard  both  for  producers  and  storers  and 
tends  to  remove  some  of  the  speculative  features  naturally  inherent  to  the  industry. 

PRESENT    POLICY    OF    REGULATIONS. 

The  particular  attention  of  the  frozen-fish  industry  is  called  to  general  license  regu- 
lations No.  1  (printed  in  a  separate  pamphlet)  governing  all  industries  licensed  by  the 
United  States  Food  Administration. 

(1)  The  reports  required  from  all  licensees  will  furnish  a  basis  from  which  to  survey 
the  operations  of  all  licensees  during  the  season  of  1918-19. 

As  the  season  progresses  special  reports  will  be  requested  whenever  deemed  advisable. 
These  will  supplement  our  follow  up  of  daily  quotations  in  the  principal  distributing 
centers. 

(2)  With    the    approach    of    winter    certain    staple   varieties    of   frozen    fish    stored   in 
heavy  volume  will  be  given  special  consideration,  and  the  United  States  Food  Adminis- 
tration   hopes,    if   such   action   is    deemed    to  be   desirable   and   practicable,    to   announce 
maximum  prices  beyond  which  these  particular  varieties  can  not  be  sold  to  the  retailer 
or  supplier  of  hotels  and  institutions.     Such  maximum  prices,   when  announced  will  be 
based  on  merchandise  costs,  with  due  allowance  for  reasonable  margins  of  profit. 

Such  maximums,  when  announced,  must  be  accepted  as  guides  only.  They  do  not 
modify  the  rules  and  must  not  be  regarded  by  storers  or  owners  of  relatively  low-cost 
packs  as  an  invitation  to  take  unreasonable  profits. 

Rule  5  of  the  general  license  regulations  provides  as  follows  : 

"  The  licensee  shall  not  import,  manufacture,  store,  distribute,  sell,  or  otherwise 
handle  any  food  commodities  on  an  unjust,  exorbitant,  unreasonable,  discriminatory,  or 
unfair  commission,  profit,  or  storage  charge." 

We  call  attention  to  the  fact  that  storers  of  frozen  fish  in  districts  favored  by  a 
heavy  average  production  will  have  acquired  their  stocks  at  a  much  lower  cost  than 
storers  where  the  runs  of  fish  have  been  short  and  unfavorable.  The  United  States 
Food  Administration  will  expect  the  rapid  pushing  of  all  low-cost  packs  through  the 
usual  distributing  channels  early  in  the  season,  and  under  such  conditions  as  will 
naturally  bring  about  prices  to  the  retailer  and  the  supplier  of  hotels  and  institutions 
materially  below  any  maximum  prices  which  may  hereafter  be  established. 


616  HISTORY   OF   PRICES   DURING  THE   WAR. 

(3)  Attention  is  also  called  to  general  rule  6  regarding  resales  within  the  trade. 
The  aim  of  the  United  States  Food  Administration  is  to  keep  the  supplies  of  the  various 
varieties  of  frozen  fish  moving  naturally,  freely,  and  as  rapidly  as  possible  into  con- 
suming channels  at  the  prevailing  prices  determined  solely  by  an  open  unrestricted  market 
in  each  distributing  district  and  without  local  or  general  manipulation  and  without 
advantage  being  taken  by  the  trade  of  temporary  emergencies  creating  artificial  price 
conditions. 

August  1M,   1918. 

XVIII.  DISTRIBUTORS  OF  POULTRY. 

(Effective  Dec.  9,  1918.) 

A.  SPECIAL    REGULATIONS    GOVERNING    DISTRIBUTORS    OF    FRESH 

POULTRY. 

INTERTRADING  RESTRICTED. 

General  rule  6  provides  as  follows : 

"  The  licensee,  in  selling  food  commodities,  shall  keep  such  commodities  mov- 
ing to  the  consumer  in  as  direct  line  as  practicable  and  without  unreasonable 
delay.  Resales  within  the  same  trade  without  reasonable  justification,  espe- 
cially if  tending  to  result  in  a  higher  market  price  to  the  retailer  or  consumer, 
will  be  dealt  with  as  an  unfair  practice." 

The  United  States  Food  Administration  recognizes  the  following  classes  of 
dealers  in  fresh  poultry : 

1.  Original  packers  and  shippers. 

2.  Commission  merchants  and  wholesalers. 

3.  Jobbers  and  suppliers  of  hotels  and  institutions. 

4.  Retailers. 

All  trading  in  fresh  poultry  must  contribute  toward  moving  the  poultry  in  a 
direct  line  to  the  consumer.  Sales  between  dealers  in  any  one  of  the  classes 
mentioned  above  are  prohibited,  except  as  follows:  Sales  between  wholesalers 
in  different  cities  will,  for  the  present,  be  permitted  where  necessary  to 
supply  the  reasonable  requirements  of  the  buyer's  business,  provided  there  is  an 
actual  shipment  of  the  goods,  and  provided  the  movement  between  cities  is  in 
the  direction  of  normal  crop  movement  from  producer  to  consumer.  In  addi- 
tion thereto,  not  more  than  two  sales  between  dealers  in  class  2  may  be  made 
without  obtaining  the  consent  of  the  local  Federal  food  administrator  if  such 
sales  are  necessary  to  supply  the  reasonable  requirements  of  the  buyer's  busi- 
ness, but  more  than  two  sales  between  dealers  in  class  2  shall  not  be  made 
without  the  written  consent  of  the  local  Federal  food  administrator.  One  sale, 
and  only  one,  between  dealers  in  the  same  class  other  than  class  2  may  be 
made  without  obtaining  the  consent  of  the  local  Federal  food  administrator  if 
such  sale  is  necessary  to  supply  the  reasonable  requirements  of  the  buyer's 
business,  but  more  than  one  such  sale  shall  not  be  made  without  the  written 
consent  of  the  local  Federal  food  administrator. 

In  no  case  shall  a  dealer  sell  fresh  poultry  to  any  dealer  in  a  class  further 
removed  from  the  consumer  than  the  class  in  which  the  seller  is  included ;  for 
example,  a  jobber  shall  not  sell  to  a  wholesaler,  or  a  retailer  to  a  wholesaler. 

No  objection  will  be  made  to  sales  of  fresh  poultry  that  are  made  at  a  price 
that  is  less  than  or  equal  to  the  initial  cost  to  the  seller  of  the  particular  com- 
modities sold,  nor  are  such  sales  to  be  counted  as  sales  between  dealers  in  the 
same  class. 

Licensees  will  be  expected  to  find  out  whether  sales  are  justifiable  by  obtain- 
ing information  as  to  the  class  in  which  the  seller  and  buyer  are  dealing,  and 
the  location  and  class  of  the  licensee  from  whom  the  seller  purchased.  This 
information  should  be  placed  on  all  confirmation  of  sales. 

B.  SPECIAL   REGULATIONS    GOVERNING   DISTRIBUTORS   OF  FROZEN 

POULTRY. 

DEFINITIONS. 

In  the  following  rules  the  different  kinds  of  dealers  in  frozen  poultry  are 
defined  as  follows: 

(a)  An  original  packer  or  shipper  is  a  person,  firm,  corporation,  or  association  that 
assembles  and  packs  the  poultry  for  market  or  storage. 

(6)  A  commission  merchant  is  a  person,  firm,  corporation,  or  association  that  solicits 
for  sale  or  receives  for  sale,  and  sells  food  products  on  a  commission  basis,  or  that  acts 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  617 

as  agent  or  representative  of  shippers,  packers,  and  other  distributors  in  the  marketing 
of  food  products  for  a  fixed  package  charge  or  on  a  percentage  basis. 

(c)  A  wholesaler  is  a  person,  firm,  corporation,  or  association  other  than  the  original 
packer  or  shipper  that  sells  to  jobbers  or  to  suppliers  of  hotels  and  institutions. 

(d)  A.  jobber  is  a  person,  firm,   corporation,   or  association   that   sells   or   distributes 
to  retailers. 

(e)  A   supplier  of   hotels   and  institutions  is  a  person,   firm,   corporation,   or   associa- 
tion that  sells  to  hotels,   restaurants,   clubs,   dining-car   or  steamship   companies,  public 
or  private  institutions,  or  to  retail  dealers  requiring  specially  selected  stock  and  being 
furnished  a  service  similar  to  that  rendered  to  hotels  and  institutions. 

(f)  A  retailer  is  a  person,  firm,  corporation,  or  association  that  sells  or  distributes 
to  consumers. 

(</)  The  original  storer  is  the  person,  firm,  corporation,  or  association  that  owns 
poultry  when  first  placed  in  a  cold-storage  warehouse. 

NOTES. —  (1)  Where  a  licensee  sells  poultry  within  30  days  from  the  date  of  original 
storage,  the  buyer  may  also  be  considered  the  original  storer  to  the  extent  that  ho 
may  add  to  the  maximum  advance  over  cost,  allowed  in  selling  as  a  wholesaler,  jobber, 
etc.,  any  part  of  6  per  cent  over  the  first  storer's  cost  not  added  by  the  first  storer. 
In  such  cases  the  first  storer  who  sells  within  30  days  must  inform  the  buyer  what 
portion  of  6  per  cent  over  his  cost  he  has  added. 

(2)  Where  a  definite  lot  of  poultry  is  sold  before  it  is  placed  in  a.  cold-storage  ware- 
house, and  if  title  to  this  lot  actually  passes  to  the  purchaser,  or  if  title  is  retained 
by  the  seller  merely  as  security  for  the  purchase  price,  and  thereafter  the  poultry  is  put 
in  the  warehouse,  the  purchaser  will  be  considered  the  original  storer,  even  though  the 
poultry  is  carried  and  insured  in  the  seller's  name. 

Determination  of  costs. — Wherever  in  the  following  rules  dealers  in  frozen  poultry 
are  limited  in  the  advance  over  cost  at  which  such  poultry  may  be  sold,  "  cost "  shall 
be  construed  to  include  the  purchase  price,  or  in  the  case  of  the  original  packer  or 
shipper  the  cost  into  storage,  plus  storage  charges,  interest  on  the  goods  in  storage, 
and  insurance  on  goods  in  storage  incurred  by  the  seller  up  to  the  time  of  sale,  but 
not  to  include  any  other  expenses. 

In  determining  cost  the  licensee  may  average  the  cost  of  all  frozen  poultry  of  the 
same  kind  and  grade  which  have  not  already  been  contracted  to  be  sold,  and  may 
take  such  average  cost  as  the  cost  of  any  particular  lot  of  that  kind  and  grade.  The 
licensee  must  keep  a  record  of  the  "manner  in  which  such  average  has  been  arrived  at 
and  shall  take  as  the  cost  of  all  stock  remaining  on  hand  from  lots  already  averaged, 
the  average  cost  previously  arrived  at.  If  the  cost  of  any  frozen  poultry  is  averaged,  the 
cost  of  all  frozen  -poultry  must  be  averaged. 

NOTES. —  (1)  The  maximum  advances  over  cost  specified  in  the  following  rules  are 
not  to  be  regarded  as  normal  or  so  recognized  by  the  Food  Administration.  They  are 
intended  only  to  prevent  speculation  and  are  purposely  made  wide  to  cover  cases  where 
methods  of  doing  business  are  more  .expensive,  to  the  extent  that  such  methods  are 
justified.  Those  maximum  advances  must  not  be  exceeded  in  selling  any  specified  lot 
of  poultry,  and  the  average  advance  over  cost  charged  by  any  dealer  must  not  be  more 
than  sufficient  to  return  to  him  a  reasonable  profit  on  his  investment  in  accordance  with 
general  rule  5,  which  is  as  follows  :  "  The  licensee  shall  not  import,  manufacture,  store, 
distribute,  sell,  or  otherwise  handle  any  food  commodities  on  an  unjust,  exorbitant,  un- 
reasonable, discriminatory,  or  unfair  commission  or  storage  charge." 

(2)  Profits  on  different   sales  can   not  be  averaged.     The  licensee  is  limited  on   each 
transaction  to  the  maximum  profit  permitted  by  the  rule  and  regulations. 

(3)  Where  a  dealer  in  the  sale  of  poultry  adds  less  than  the  maximum  advance  over 
cost  permitted  by  the  rules,  the  buyer  is  not,  because  of  this  fact,  permitted  to  add  to 
the   maximum    advance   over    cost    allowed   to    him   any    part,   of   the   maximum   advance 
allowed  to  the  seller  which  the  seller  did  not  add. 

(4)  The  special  rules  regulating  the  profits  of  dealers  in  frozen  poultry  do  not  apply 
to   poultry   that  is  placed  in   a   cold-storage  warehouse,  but   which   is   removed   from    the 
cold-storage  warehouse,  for  distribution  for  consumption,  within  30  days  after  the  date 
of  the  original  entry  of  such  poultry  into  the  cold-storage  warehouse. 

SPECIAL  REGULATIONS. 

Rule  1.  Purchase  from  dealer  charging  unreasonable  margin  prohibited. — No 
licensee  shall  knowingly  purchase  frozen  poultry  from  a  dealer  who  sells  at 
a  greater  advance  over  cost  than  the  maximum  specified  in  the  following  rules, 
(Issued  Mar.  2,  1918;  repealed  Jan.  8,  1919.) 

Rule  2.  Maximum  margins  for  original  packer  or  shipper. — The  original  packer 
or  shipper,  storing  in  a  cold-storage  warehouse,  shall  not  sell  frozen  poultry 
to  wholesalers  at  an  advance  of  more  than  6  per  cent  over  cost.  In  case  frozen 
poultry  is  stored  in  the  name  of  a  commission  merchant,  the  original  storer 
shall  be  deemed  to  be  the  consignor  for  whom  the  commission  merchant  acts 
as  agent.  An  additional  advance  not  exceeding  5  per  cent  of  cost  may  be 
charged  by  the  original  packer  or  shipper  in  selling  to  jobbers  or  suppliers 
of  hotels  and  institutions.  An  additional  advance  not  exceeding  10  per  cent 
of  cost  may  be  charged  in  selling  to  retailers,  or  an  additional  advance  not 
exceeding  15  per  cent  of  cost  may  be  charged  if  the  packer  performs  the 
functions  of  a  supplier  of  hotels  and  institutions,  as  heretofore  denned.  (Is- 


f)18  HISTORY   OF   PRICES   DURING   THE   WAR. 

-sued  Mar.  2,  1918;  margins  slightly  changed  July  26,  1918;  repealed  Jan.  8, 
1919.) 

Rule  3.  Maximum  commissions. — A  commission  merchant  shall  not  receive  a 
commission  of  more  than  5  per  cent  on  frozen  poultry  consigned  to  him  by 
shippers  or  packers.  If  a  commission  merchant  acts  as  an  agent  for  dealers 
other  than  shippers  or  packers  for  the  distribution  of  surplus  stocks,  the 
selling  price  shall  not  exceed  the  maximum  advance  over  cost  to  the  consignor 
permitted  to  such  consignor  by  the  following  rules,  which  advance  shall  in- 
clude the  commission  for  such  sale.  A  commission  merchant  who  takes  to 
account  consigned  frozen  poultry  shall  not  receive  any  other  profit  beyond  the 
amount  of  the  commission  before  specified. 

A  commission  merchant  shall  require  from  consignors  a  statement  of  cost 
of  goods  and  maximum  selling  price  allowable  under  these  rules.  (Issued 
Mar.  2,  1918;  repealed  Jan.  8,  1919.) 

Rule  4.  Maximum  margin  for  wholesaler. — A  wholesaler  shall  not  sell  frozen 
poultry  at  an  advance  of  more  than  5  per  cent  over  cost.  If  a  wholesaler  also 
sells  as  a  jobber,  he  shall  not  sell  at  an  advance  of  more  than  10  per  cent  over 
cost,  as  provided  for  jobbers  in  rule  5.  The  above  maximum  advances  may  be 
increased  by  not  to  exceed  6  per  cent  of  cost  in  cases  where  the  wholesaler  is 
also  the  original  storer  in  a  cold-storage  warehouse.  (Issued  Mar.  2,  1918; 
repealed  Jan.  8,  1919.) 

Rule  5.  Maximum  margin  for  jobber. — A  jobber  shall  not  sell  frozen  poultry  at 
an  advance  of  more  than  10  per  cent  over  cost.  The  above  maximum  advance 
may  be  increased  by  not  to  exceed  6  per  cent  of  cost  in  cases  where  the  jobber 
is  also  the  original  storer  in  a  cold-storage  warehouse. 

Rule  6.  Maximum  margin  for  supplier  of  hotels  and  institutions. — A  supplier 
of  hotels  and  institutions  shall  not  sell  frozen  poultry  at  an  advance  of  more 
than  15  per  cent  over  cost.  The  above  maximum  advance  may  be  increased  by 
not  to  exceed  6  per  cent  of  cost  in  cases  where  the  supplier  of  hotels  and  insti- 
tutions is  also  the  original  storer  in  a  cold-storage  warehouse. 

Rule  7.  Direct  line  of  distribution  defined. — A  sale  by  any  dealer  in  frozen 
poultry  in  any  of  the  classes  indicated  below^  to  a  dealer  in  any  succeeding 
class  shall  be  considered  to  be  in  the  direct  line  of  distribution : 

Class  1:  Original  packers  and  shippers. 

Class  2:  Commission  merchants — wholesalers. 

Class  3 :  Jobbers— suppliers  of  hotels  and  institutions. 

Class  4:  Retailers — hotels  and  institutions. 

Rule  8.  Intertrading  restricted. — All  trading  in  frozen  poultry  shall  serve  to 
move  the  frozen  poultry  in  the  direct  line  of  distribution  to  the  consumer,  and 
nothing  contained  in  this  or  the  preceding  rule  shall  authorize  any  licensee  to 
use  any  more  indirect  method  of  distribution  of  frozen  poultry.  One  sale  of 
any  lot  of  frozen  poultry  between  dealers  in  the  same  class  may*  be  made  where 
necessary  to  supply  the  reasonable  requirements  of  the  buyer's  business,  pro- 
vided a  report  is  made  promptly  to  the  local  Federal  food  administrator.  Such 
sales  shall  be  made  at  an  advance  of  not  more  than  5  per  cent  over  cost,  except 
when  sold  by  the  original  storer,  who  shall  sell  at  not  more  than  6  per  cent  over 
cost.  If  sold  by  a  commission  merchant  to  a  wholesaler,  the  commission  shall 
not  exceed  5  per  cent. 

Except  for  such  sales,  no  licensee  shall  sell  to  another  in  the  same  or  any 
preceding  class  of  distribution  without  the  written  consent  of  the  local  Federal 
food  administrator,  which  will  be  given  only  in  extraordinary  circumstances. 
Where  such  consent  is  given,  the  dealer  shall  not  sell  at  an  advance  of  more 
than  one-fourth  cent  per  pound  over  cost,  nor  in  the  case  of  a  commission  mer- 
chant selling  to  a  wholesaler  shall  the  commission  amount  to  more  than  one- 
fourth  cent  per  pound :  Provided,  however,  That  nothing  in  this  rule  shall  pre- 
vent sales  at  cost:  Provided  further,  That  nothing  in  this  rule  shall  prevent 
sales  for  immediate  delivery  from  one  city  to  another  for  actual  distribution  to 
relieve  exceptional  local  shortage,  but  a  report  of  any  such  sale  must  be 
promptly  made  to  the  local  Federal  food  administrator,  with  the  reasons  there- 
for. Such  sales  shall  be  made  at  a  price  not  to  exceed  5  per  cent  over  cost ;  or 
if  sold  by  a  commission  merchant  to  a  wholesaler,  the  commission  shall  not 
exceed  5  per  cent :  And  provided  further,  That  nothing  in  the  rule  shall  prevent 
a  commission  merchant  from  acting  as  an  agent  for  dealers  other  than  original 
shippers  and  packers,  as  provided  in  rule  8.  (Issued  Mar.  2,  1918;  added  to 
July  26,  1918;  repealed  Jan.  8,  1919.) 

NOTE. — Licensees  will  be  expected  to  find  out  whether  sales  are  justifiable  by  obtain- 
ing information  as  to  the  class  in  which  the  seller  and  the  buyer  arc  dealing  and  the 
location  and  class  of  the  licensee  from  whom  the  seller  purchased.  This  information 
should  be  placed  on  all  confirmations  of  sales. 


GOVERNMENT   KEGULATIONS   RELATING  TO   PRICES.  619 

Rule  9.  Brokerage  to  be  included  in  margins.  —  If  brokers  act  as  agents  in  any 
sale  of  frozen  poultry  under  llie.se  rules,  brokerage  paid  shall  not  be  added  to 
the  selling  price  of  the  goods.  (Issued  Mar.  2,  1918;  repealed  Jan.  8,  1919.) 

C      ADDITIONAL     REGULATIONS     GOVERNING     COMMISSION     MER- 
CHANTS, BROKERS,  AND  AUCTIONEERS  DEALING  IN  POULTRY. 

Hule  1.  Commission  or  brokerage  not  to  be  unreasonable  or  discriminatory.  —  • 
The  licensee  fehall  not  charge,  directly  or  indirectly,  an  unjust,  exorbitant, 
unreasonable,  discriminatory,  or  unfair  commission  or  brokerage  on  the  sale 
of  poultry.  (Issued  July  10,  1918;  repealed  Jan.  8,  1919.) 


.  —  The  Food  Administration  in  enforcing  this  rule  will  insist  that  any  proposed 
increase  in  rates  be  submitted  to  the  local  Federal  food  administrator  and  that  the 
reason  for  any  increased  rate  over  the  prewar  normal  be  justified  to  him,  subject  to  the 
general  supervision  of  the  United  States  Food  Administration,  before  such  increased 
rates  are  put  into  effect.  The  rates  to  be  charged  by  a  commission  merchant  are  more 
specilically  treated  under  B,  rule  3,  supra. 

Rule  2.  Prompt  remittance  and  proper  account  sales  to  be  rendered.  —  The 

licensee  shall  remit  promptly  following  the  sale  of  poultry  received  on  con- 
signment for  sale  or  distribution  and  shall  render  to  the  consignor  an  account 
showing  tlie  true  sales  and  with  charges  only  for  services  actually  performed 
and  expenses  actually  incurred  by  the  licensee.  (Issued  Nov.  1,  1917,  as  to 
"food  commodities";  repealed  Jan.  8,  1919.) 

NOTE.  —  When  a  commission  merchant  receives  a  consignment  of  poultry  and  guaran- 
tees to  the  consignor  a  definite  selling  price,  he  must  show  on  the  account  sales  the 
actual  price  at  which  the  goods  are  sold,  together  with  services  actually  performed  and 
expenses  actually  incurred,  and  as  a  separate  item  must  show  any  sum  paid  to  the 
consignor  by  reason  of  the  commission  merchant's  contract  of  guaranty.  Failure  to  do 
this  will  be  considered  a  violation  of  the  above  rule  and  also  a  misstatemeut  of  the 
price  at  which  commodities  are  being  sold,  in  violation  of  general  rule  19. 

Rule  3.  Agent  not  to  buy  from  principal  unless  noted  on  account  of  sales.  —  The 
licensee  shall  not,  directly  or  indirectly,  sell  consigned  poultry  or  poultry  with 
the  sale  of  which  on  commission  he  is  intrusted  to  himself  or  to  anyone  con- 
nected with  his  business,  unless  he  notes  the  facts  of  such  transaction  on  the 
account  of  sales. 

NOTE.  —  This  rule  is  not  intended  to  relieve  the  licensee  from  any  legal  obligation 
resting  on  him  to  obtain  authorization  from  the  shipper  before  taking  to  account  goods 
consigned  to  him  or  to  obtain  the  ratification  of  such  a  transaction. 

From  November  1,  1917,  to  April  16,  1918,  the  rule  governing  all  commission  mer- 
chants, brokers,  and  auctioneers  which  limited  their  charges  to  "  *  *  *  that  which 
ordinarily  and  customarily  prevails  under  normal  conditions  in  the  locality  in  which 
*  *  *  their  business  is  conducted  "  applied  to  these  dealers  in  perishables. 

Rule  15.  Certificate  of  value  to  be  furnished  to  cold-storage  warehousemen.  — 
The  licensee  storing  poultry  with  a  cold-storage  warehouseman  upon  which  the 
warehouseman  either  directly  or  indirectly  loans  money  shall  upon  request  of 
such  warehouseman  file  with  him  a  certificate  stating  the  market  value  of  the 
goods  stored  and  shall  make  no  false  or  misleading  statement  in  such  certificate 
nor  shall  he  fail  to  maintain  the  margin  required  by  the  regulations  of  the  Food 
Administration  on  loans  made  by  cold-storage  warehousemen.  (Issued  Feb.  7, 
1918,  as  to  "  commodities  required  to  be  licensed  "  ;  repealed  Jan.  8,  1919.) 

XIX.  DISTRIBUTORS  OF  EGGS. 

INTERTRADING  RESTRICTED. 

General  rule  6  provides  as  follows  : 

"  The  licensee,  in  selling  food  commodities,  shall  keep  such  commodities  mov- 
ing to  the  consumer  in  as  direct  a  line  as  practicable  and  without  unreasonable 
delay.  Resales  within  the  same  trade  without  reasonable  justification,  espe- 
cially if  tending  to  result  in  a  higher  market  price  to  the  retailer  or  consumer, 
will  be  dealt  with  as  an  unfair  practice." 

The  United  States  Food  Administrator  recognizes  the  following  classes  of 
dealers  in  fresh  eggs: 

1.  Original  packers  and  shippers, 

2.  Commission  merchants  and  wholesalers. 

3.  Jobbers  and  suppliers  of  hotels  and  institutions. 

4.  Retailers. 

All  trading  in  fresh  eggs  must  contribute  toward  moving  the  eggs  in  a  direct 
line  to  the  consumer.  Sales  between  dealers  in  any  one  of  the  classes  men- 


620  HISTORY   OF   PRICES   DURING  THE   WAR. 

t.ionecl  above  are  prohibited  except  as  follows :  Sales  between  wholesalers  in 
different  cities  will  for  the  present  be  permitted  where  necessary  to  supply  the 
reasonable  reqiiirements  of  the  buyer's  business,  provided  there  is  an  actual 
shipment  of  the  goods,  and  provided  the  movement  between  cities  is  in  the  direc- 
tion of  normal  crop  movement  from  producer  to  consumer.  In  addition  thereto 
not  more  than  two  sales  of  any  lot  of  fresh  eggs  between  dealers  in  class  2  may 
be  made  without  obtaining  the  consent  of  the  local  Federal  food  administrator  if 
such  sales  are  necessary  to  supply  the  reasonable  requirements  of  the  buyer's 
business,  but  more  than  two  sales  between  dealers  in  class  2  shall  not  be  made 
without  the  written  consent  of  the  local  Federal  food  administrator.  One  sale, 
and  only  one,  between  dealers  in  the  same  class  other  than  class  2  may  be  made 
without  obtaining  the  consent  of  the  local  Federal  food  administrator  if  such 
sale  is  necessary  to  supply  the  reasonable  requirements  of  the  buyer's  business, 
but  more  than  one  such  sale  shall  not  be  made  without  the  written  consent  of 
the  local  Federal  food  administrator. 

In  no  case  shall  a  dealer  sell  fresh  eggs  to  any  dealer  in  a  class  further  re- 
moved from  the  consumer  than  the  class  in  which  the  seller  is  included ;  for 
example,  a  jobber  shall  not  sell  to  a  wholesaler,  or  a  retailer  to  a  wholesaler. 

No  objection  will  be  made  to  sales  of  fresh  eggs  between  dealers  in  the  same 
class  that  are  made  at  a  price  that  is  less  than  or  equal  to  the  initial  cost  to  the 
seller  of  the  particular  commodities  sold,  nor  are  such  sales  to  be  counted  as 
sales  between  dealers  in  the  same  class. 

Licensees  will  be  expected  to  find  out  whether  sales  are  justifiable  by  obtain- 
ing information  as  to  the  class  in  which  the  seller  and  the  buyer  are  dealing  and 
the  location  and  class  of  the  licensee  from  whom  the  seller  purchased.  This  in- 
formation should  be  placed  on  all  confirmations  of  sales. 

B.    SPECIAL    REGULATIONS    GOVERNING    DISTRIBUTORS    OF    COLD- 
STORAGE  EGGS. 

In  the  following  rules  the  different  kinds  of  dealers  in  cold-storage  eggs  are 
defined  as  follows: 

(a)  An  original  packer  or  shipper  is  a  person,  firm,  corporation,  or  association  that 
assembles  and  packs  the  eggs  for  market  or  storage. 

(b)  A  commission  merchant  is  a  person,  firm,  corporation,  or  association  that  solicits 
for  sale  or  receives  for  sale  and  sells  food  products  on   a   commission   basis,   or  that 
acts   as   agent   or   representative  of  shippers,    packers,    and    other   distributors   in    the 
marketing  of  food  products  for  a  fixed  package  charge  or  on  a  percentage   basis. 

(c)  A  wholesaler  is  a  person,  firm,  corporation,  or  association,  other  than  the  origi- 
nal packer  or  shipper,   that  sells  to  jobbers  or  to  suppliers  of  hotels  and  institutions. 

(rf)  A  jobber  is  a  person,  firm,  corporation,  or  association  that  sells  or  distributes 
to  retailers. 

(e)  A  supplier  of  hotels  and  institutions  is  a  person,  firm,  corporation,  or  associa- 
tion that  sells  to  hotels,  restaurants,  clubs,  dining-car  or  steamship  companies,  public 
or  private  institutions,  or  to  retail  dealers  requiring  specially  selected  stock  and  being 
furnished  a  service  similar  to  that  rendered  to  hotels  and  institutions. 

(/)  A  retailer  is  a  person,  firm,  corporation,  or  association  that  sells  or  distributes 
to  consumers. 

(cj)  The  original  storer  is  the  person,  firm,  corporation,  or  association  that  owns 
eggs  when  first  placed  in  a  cold-storage  warehouse. 

NOTE. —  (1)  Where  a  licensee  sells  eggs  within  30  days  from  the  date  of  original 
storage,  the  buyer  may  also  be  considered  the  original  storer  to  the  extent  that  he 
may  add  to  the  maximum  advance  over  cost  allowed  in  selling  as  a  wholesaler,  jobber, 
etc.,  any  part  of  6  per  cent  over  the  first  storer's  cost  not  added  by  the  first  storer. 
In  such  cases  the  first  storer  who  sells  within  30  days  must  inform  the  buyer  what 
portion  of  6  per  cent  over  his  cost  he  has  added. 

(2)  Where  a  definite  lot  of  eggs  is  sold  before  it  is  placed  in  a  cold-storage  ware- 
house, and  if  title  to  this  lot  actually  passes  to  the  purchaser,  or  if  title  is  retained 
by  the  seller  merely  as  security  for  the  purchase  price,  and  thereafter  the  eggs  are 
put  in  the  warehouse,  the  purchaser  will  be  considered  the  original  storer  even  though 
the  eggs  are  carried  and  insured  in  tne  seller's  name. 

Wherever  in  the  following  rules  dealers  in  cold-storage  eggs  are  limited  in  the  ad- 
vance over  cost  at  which  such  eggs  may  be  sold,  "  cost "  shall  be  construed  to  include 
the  purchase  price,  or  in  the  case  of  the  original  packer  or  shipper  the  cost  into 
storage,  plus  storage  charges,  interest  on  the  goods  in  storage,  and  insurance  on  goods 
in  storage  incurred  by  the  seller  up  to  the  time  of  sale,  but  not  to  include  any  other 
expenses,  except  as  hereinafter  provided  in  the  case  of  candled  eggs. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  621 

In  selling  eggs  candied  by  the  licensee  the  actual  net  candling  loss  may  be  included, 
in  the  cost,  but  the  expense  of  labor  and  materials  in  candling  and  all  repacking  ex- 
penses shall  not  he  included. 

In  determining  cost  licensees  may  average  the  cost  of  all  lots  of  cold-storage  eggs 
of  the  same  grade  which  were  originally  stored  in  the  same  month  and  which  have 
not  already  been  contracted  to  be  sold,  and  may  take  such  average  cost  as  the  cost 
of  any  particular'  lot.  The  licensee  must  keep  a  record  of  the  manner  in  which  such 
average  had  been  arrived  at  and  shall  take  as  the  cost  of  all  stock  remaining  on 
hand  from  lots  already  averaged  the  average  cost  previously  arrived  at.  If  the  cost 
of  any  cold-storage  eggs  is  averaged,  the  cost  of  all  cold-storage  eggs  must  be  averaged. 

NTOTE. —  (1)  The  maximum  advances  over  cost  specified  in  the  following  rules  are 
uot  to  be  regarded  as  normal  or  so  recognized  by  the  Food  Administration.  They 
are  intended  only  to  prevent  speculation  and  are  purposely  made  wide  to  cover  cases 
where  the  methods  of  doing  business  are  more  expensive,  to  the  extent  that  such, 
methods  are  justified.  These  maximum  advances  must  not  be  exceeded  in  selling  any 
specified  lot  of  eggs,  and  the  average  advance  over  cost  charged  by  any  dealer  must 
not  be  more  than  sufficient  to  return  to  him  a  reasonable  profit  on  his  investment  in 
accordance  with  general  rule  5,  which  is  as  follows  :  "  The  licensee  shall  not  import, 
manufacture,  store,  distribute,  sell,  or  otherwise  handle  any  food  commodities  on  an 
unjust,  exorbitant,  unreasonable,  discriminatory,  or  unfair  commission,  profit,  or  storage 
charge." 

(2)  The  special  rules  regulating  the  profits  of  dealers  in  cold-storage  eggs  do  not 
apply  to  eggs  that  are  placed  in  a  cold-storage  warehouse,  but  which  are  removed  from, 
the  cold-storage  warehouse  for  distribution  for  consumption  within  30  days  after 
the  date  of  the  original  entry  of  such  eggs  into  the  cold-storage  warehouse. 

(o.)  Profits  on  different  sales  can  not  be  averaged.  The  licensee  is  limited  on  each 
transaction  to  the  maximum  profit  permitted  by  the  rules  and  regulations. 

(4)  Where  a  dealer  in  the  sale  of  cold-storage  eggs  adds  less  than  the  maximum 
advance  over  cost  permitted  by  the  rules,  the  buyer  is  not  because  of  this  fact  per- 
mitted to  add  to  the  maximum  advance  over  cost  allowed  to  him  any  part  of  the 
maximum  advance  allowed  to  the  seller  which  the  seller  did  not  add. 

Rule  1.  Purchase  from  dealer  charging  unreasonable  margin  prohibited. — No 
licensee  shall  knowingly  purchase  cold-storage  eggs  from  a  dealer  who  sells  at  a 
greater  advance  over  cost  than  the  maximum  specified  in  the  following  rules. 
(Issued  Mar.  2,  1918;  repealed  Feb.  14,  1919.) 

Rule  2.  Maximum  margins  for  original  packer  or  shipper. — The  original  packer 
or  shipper  storing  in  a  cold-storage  warehouse  shall  not  sell  cold-storage  eggs 
to  wholesalers  at  an  advance  of  more  than  6  per  cent  over  cost.  In  case  cold- 
storage  eggs  are  stored  in  the  name  of  a  commission  merchant,  the  original 
storer  shall  be  deemed  to  be  the  consignor  for  whom  the  commission  merchant 
acts  as  agent.  An  additional  advance  not  exceeding  4  per  cent  of  cost  may  be 
charged  by  the  original  packer  or  shipper  in  selling  eggs  at  mark  or  7  per  cent 
over  cost  in  selling  eggs  candled  by  him  to  jobbers  or  suppliers  of  hotels  and 
institutions.  An  additional  advance  may  be  charged  in  .selling  to  retailers  not 
exceeding  5  per  cent  of  cost  if  sold  at  mark  (i.  e.,  in  original  packages),  and  not 
exceeding  10  per  cent  of  cost  in  selling  eggs  candled  by  him.  An  additional 
advance  not  exceeding  12  per  cent  of  cost  may  be  charged  if  the  original  packer 
performs  the  functions  of  a  supplier  of  hotels  and  institutions,  as  heretofore 
defined.  (Issued  Mar.  2,  1918;  margins  slightly  changed  July  26,  1918,  and 
Nov.  11,  1918;  repealed  Feb.  14,  1919.) 

Rule  3.  Maximum  commissions. — A  commission  merchant  shall  not  receive  a 
commission  of  more  than  4  per  cent  on  cold-storage  eggs  consigned  to  him.  The 
selling  price  of  cold-storage  eggs  sold  through  a  commission  merchant  shall  not 
exceed  the  maximum  advance  over  cost  permitted  to  the  consignor  by  these 
rules,  which  advance  shall  include  the  commission  for  the  sale.  A  commission 
merchant  who  takes  to  .account  consigned  cold-storage  eggs  shall  not  receive 
any  other  profit  beyond  the  amount  of  the  commission  before  specified.  A  com- 
mission merchant  shall  require  from  consignors  a  statement  of  cost  of  goods  and 
maximum  selling  price  allowable  under  these  rules.  (Issued  Mar.  2,  1918; 
repealed  Feb.  14,  1919.) 

Rule  4.  Maximum  margin  for  wholesaler. — A  wholesaler  shall  not  sell  cold- 
storage  eggs  at  mark  at  an  advance  of  more  than  4  per  cent  over  cost  or  7  per 
cent  over  cost  if  he  candles  the  eggs.  If  a  wholesaler  also  sells  as  a  jobber,  he 
shall  not  sell  eggs  at  mark  at  an  advance  of  more  than  5  per  cent  over  cost  or 
eggs  candled  by  him  at  more  than  10  per  cent  over  cost  as  provided  for  jobbers 
in  rules  5  and  6.  The  above  maximum  advances  may  be  increased  by  not  to 
exceed  6  per  cent  of  cost,  in  cases  where  the  wholesaler  is  also  the  original 
storer  in  a  cold-storage  warehouse.  (Issued  Mar.  2,  1918;  margins  slightly 
changed  Nov.  11,  1918;  repealed  Feb.  14,  1919.) 

Rule  5.  Maximum  margin  for  jobber  of  cold-storage  eggs  at  mark. — A  jobber 
shall  not  sell  cold-storage  eggs  at  mark  (i.  e.,  in  original  packages)  at  an 


622  HISTORY   OF   PRICES  DURING  THE   WAR. 

advance  of  more  than  5  per  cent  over  cost.  (Issued  Mar.  2,  1918;  repealed 
Feb.  14,  1919.) 

Rule  6.  Maximum  margin  for  jobber  of  candled  eggs. — A  jobber  shall  not  sell 
-eggs  candled  by  him  at  an  advance  of  more  than  10  per  cent  over  cost.  The 
maximum  advance  prescribed  in  rules  5  and  6  may  be  increased  by  not  to  exceed 
6  per  cent  of  cost  in  cases  where  the  jobber  is  also  the  original  storer  in  a  cold- 
storage  warehouse.  (Issued  Mar.  2,  1918;  repealed  Feb.  14,  1919.) 

Rule  7.  Maximum  margin  for  supplier  of  hotels  and  institutions. — A  supplier 
of  hotels  and  institutions  shall  not  sell  eggs  candled  and  selected  by  him  at 
more  than  12  per  cent  over  cost.  This  maximum  advance  may  be  increased  by 
not  to  exceed  6  per  cent  of  cost  in  cases  where  the  supplier  of  hotels  and  insti- 
tutions is  also  the  original  storer  in  .a  cold-storage  warehouse.  (Issued  Mar.  2, 
1918;  repealed  Feb.  14,  1919.) 

Rule  8.  Maximum  margin  for  retailer  storing  eggs  during  1918. — A  retailer 
who  is  the  original  storer  of  eggs  during  1918  shall  not  sell  such  eggs  candled 
and  selected  by  him  at  an  advance  of  more  than  21  per  cent  over  cost.  -(Issued 
Mar,  2,  1918;  margins  changed  Oct.  22,  1918;  repealed  Feb.  14,  1919.) 

NOTE. — Maximum  margins  for  retailers  on  all  sales  of  eggs  other  than  those  above 
specified  will  be  announced  separately. 

Rule  9.  Direct  line  of  distribution  defined.— A  sale  by  any  dealer  in  cold- 
storage  eggs  in  any  of  the  classes  indicated  below  to  a  dealer  in  any  succeeding 
class  shall  be  considered  to  be  in  the  direct  line  of  distribution: 

Class  1.  Original  packers  and  shippers. 

Class  2.  Commission  merchants — Wholesalers. 

Class  3.  Jobbers — Suppliers  of  hotels  and  institutions. 

Class  4.  Retailers — Hotels  and  institutions. 

(Issued  Mar.    2,  1918;  repealed  Feb.  14,  1919.) 

Hule  10.  Intertrading  restricted. — All  trading  in  cold-storage  eggs  shall  serve 
to  move  the  cold-storage  eggs  in  the  direct  line  of  distribution  to  the  consumer 
ond  nothing  contained  in  this  or  the  preceding  rule  shall  authorize  any  licensee 
to  use  any  more  indirect  method  of  distribution  than  he  has  been  accustomed 
to  use  in  the  past  in  the  distribution  of  egg;-.  One  sale  of  any  lot  of  cold-storage 
•eggs  between  dealers  in  the  same  class  may  be  made  where  necessary  to  supply 
the  reasonable  requirements  of  the  buyer's  business.  Such  sales  shall  bo  made 
at  an  advance  of  not  more  than  2  per  cent  over  cost,  except  when  sold  by  a 
-wholesaler  or  jobber  who  is  also  the  original  storer  who  shall  sell  at  not  more 
than  6  per  cent  over  cost.  Where  a  dealer  buys  cold-storage  eggs  from  another 
dealer  in  the  same  class  other  than  the  original  storer  he  must  sell  the  eggs  so 
bought  at  not  more  than  the  maximum  advances  over  cost  specified  in  the  above 
rules  minus  2  per  cent.  A  licensee  who  does  business  both  as  a  wholesaler  and 
jobber  may  buy  as  a  jobber  "with  the  intention  of  reselling  to  a  retailer  or  of 
•making  the  one  permissible  resale  to  other  jobbers,  or  to  suppliers  of  hotels  or 
institutions. 

Except  for  such  sales  no  licensee  shall  sell  to  another  in  the  same  or  any  pre- 
ceding class  of  distribution  without  the  written  consent  of  the  local  Federal 
food  administrator,  which  will  be  given  only  in  extraordinary  circumstances. 
Where  such  consent  is  given  the  dealer  shall  not  sell  at  an  advance  of  more  than 
K)  cents  per  case  orer  cost,  nor  in  the  case  of  a  commission  merchant  selling  to  a 
wholesaler  shall  the  commission  amount  to  more  than  10  cents  per  case:  Pro- 
vided, limccver.  That  nothing  in  this  rule  -shall  prevent  sales  for  immediate 
delivery  from  one  city  to  another  for  actual  distribution  to  relieve  exceptional 
local  shortage,  but  a  report  of  any  such  sale  must  be  promptly  made  to  the 
local  Federal  food  administrator,  with  the  reasons  therefor.  Such  sales  shall 
•be  made  at  a  price  not  to  exceed  4  per  cent  over  cost.  (Issued  Mar.  2,  1918- ; 
advance  at  which  dealers  may  sell  changed  July  26,  1918,  and  Oct.  31,  1918; 
repealed  Feb.  14,  1919.) 

NOTE. — Licensees  will  be  expected  to  find  out  whether  sales  are  justifiable  by  obtain- 
ing information  as  to  the  class  in  which  the  seller  and  the  buyer  are  dealing  and  the 
location  and  cla&s  of  the  licensee  from  whom  the  seller  purchased.  This  information 
should  be  placed  on  all  confirmations  of  «ales. 

Rule  11.  Brokerage  to  be  included  in  margins. — If  brokers  act  as  agents  in  any 
sale  of  cold-storage  eggs  under  these  rules  brokerage  paid  shall  not  be  added  to 
the  selling  price  of  the  goods.  (Issued  Mar.  2,  1918 ;  repealed  Feb.  14,  1919.) 

Rule  16.  Certificate  of  value  to  be  furnished  to  cold-storage  warehousemen. — 
The  licensee  storing  eggs  with  a  cold-storage  warehouseman  upon  which  the 
warehouseman  either  directly  or  indirectly  loans  money  shall  upon  request  of 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES.  623 

such  warehouseman  file  with  him  a  certificate  stating  the  market  value  of  the 
goods  stored  and  shall  make  no  false  or  misleading  statement  in  such  certificate 
nor  shall  he  fail  to  maintain  the  margin  required  by  the  regulations  of  the  Food 
Administration  on  loans  made  by  cold-storage  warehousemen.  (Issued  Feb.  7, 
1918,  as  to  "  commodities  required  to  be  licensed  " ;  repealed  Feb.  14,  1919.) 

C.      ADDITIONAL      REGULATIONS      GOVERNING      COMMISSION      MER- 
CHANTS,  BROKERS,   AND  AUCTIONEERS   DEALING   IN   EGGS. 

Rule  1.  Commission  or  brokerage  not  to  be  unreasonable  or  discriminatory. — 

The  licensee  shall  not  charge,  directly  or  indirectly,  an  unjust,  exorbitant, 
unreasonable,  discriminating,  or  unfair  commission  or  brokerage  on  the  sale  of 
eggs.  (Issued  July  10,  1918;  repealed  Feb.  14,  1919.) 

NOTE. — The  Food  Administration  in  enforcing  this  rule  will  insist  that  any  proposed 
increase  in  rates  be  submitted  to  the  local  Federal  food  administrator  and  that  the 
reason  for  any  increased  rate  over  tho  prewar  normal  be  justified  to  him,  subject  to  the 
general  supervision  of  the  United  States  Food  Administration,  before  such  increased 
rates  are  put  into  effect. 

The  rates  to  be  charged  by  a  commission  merchant  are  more  specifically  treated  under 
B,  rule  3,  supra. 

Hule   2.  Prompt  remittance   and  proper   account  sales   to   be  rendered. — The 

licensee  shall  remit  promptly  following  the  sale  of  eggs  received  on  consignment 
for  sale  or  distribution  arid  shall  render  to  the  consignor  an  account  showing 
the  true  sales  and  with  charges  only  for  services  actually  performed  and 
expenses  actually  incurred  by  the  licensee.  (Issued  Nov.  1,  1917,  as  to  "  food 
commodities";  repealed  Feb.  14,  1919.) 

NOTE. — Where  a  commission  merchant  I'eceives  a  consignment  of  poultry  or  eggs  and 
guarantees  to  the  consignor  a  definite  selling  price,  he  must  show  on  the  account  sales 
the  actual  price  at  which  the  goods  are  sold,  together  with  services  actually  performed 
and  expenses  actually  incurred,  and  as  a  separate  item  must  show  any  sum  paid  to  the 
consignor  by  reason  of  the  commission  merchant's  contract  of  guaranty.  Failure  to  do 
this  will  be  considered  a  violation  of  the  above  rule  governing  commission  merchants 
and  also  a  misstatement  of  the  price  at  which  commodities  are  being  sold  in  violation  of 
general  rule  19. 

Rule  3.  Agent  not  to  buy  from  principal  unless  noted  on  account  of  sales. — The 

licensee  shall  not,  directly  or  indirectly,  sell  consigned  eggs  or  eggs  with  the 
sale  of  which  on  commission  he  is  intrusted,  to  himself  or  to  anyone  connected 
with  his  business,  unless  he  notes  the  facts  of  such  transaction  on  the  account 
of  sales.  (Issued  Nov.  1,  1917,  as  to  "food  commodities";  repealed  Feb.  14, 
1919.) 

NOTE. — This  rule  is  not  intended  to  relieve  the  licensee  from  any  legal  obligation 
resting  on  him  to  obtain  authorization  from  tha  shipper  before  taking  to  account  goods 
consigned  to  him  or  to  obtain  the  ratification  of  such  a  transaction. 

'  From    November   1,    1917,   to  April   16,    1918,   the  rule  governing  all   commission   mer- 
chants,  brokers,   and  auctioneers  which  limited  their  charges  to  "  *      *     **     that  which 
ordinarily    and    customarily    prevails   under    normal   conditions   in   the   locality  in   which 
their  business  is  conducted     *  "  applied  to  these  dealers  in  perishables. 

I).  ADDITIONAL  SPECIAL  REGULATIONS  GOVERNING  RETAILERS  OF 

EGGS. 

Eule  1.  Fresh  or  cold-storage  eggs  must  not  be  sold  at  retail  at  more  than 
reasonable  advance  over  cost. — The  licensee  shall  not  sell  fresh  or  cold-storage 
eggs  at  retail  at  more  than  a  reasonable  advance  over  cost  without  regard  to  the 
market  or  replacement  value  at  the  time  of  the  sale.  Cost  shall  include  purchase 
price  and  transportation  charges,  and  where  the  retailer  actually  candles  and 
grades  eggs  he  may  include  in  the  cost  the  actual  loss  from  such  candling  and 
grading.  In  the  case  of  cold-storage  eggs,  cost  shall  include  the  following  addi- 
tional items: 

1.  Storage  charges  actually  incurred. 

2.  Insurance  charges  actually  incurred. 

3.  Interest  on  money  invested  at  the  current  rate  while  eggs  are  in  storage. 
The  licensee  may  average  the  cost  of  all  lots  of  eggs  of  the  same  grade  (and 

in  the  case  of  cold-storage  eggs,  all  eggs  of  the  same  grade  which  were  originally 
stored  in  the  same  month)  in  his  possession  at  the  point  from  which  the  sale  is 
made  which  have  not  already  been  contracted  to  be  sold,  and  may  take  such 
average  cost  as  the  cost  of  any  particular  lot.  When  new  lots  arc  added  and  a 
new  average  calculated,  the  licensee  shall  include  in  the  new  averaging  all  stock 
remaining  on  hand  from  lots  already  averaged  at  the  average  cost  previously 
determined.  If  the  cost  of  any  eggs  is  averaged  the  cost  of  all  eggs  must  be 


624 


HISTORY   OF   PRICES    DURING   THE   WAR. 


averaged.  When  costs  are  averaged  the  licensee  must  keep  a  record  of  the 
manner  in  which  such  average  has  been  arrived  at.  (Issued  Oct  22,  1918-  re- 
pealed Feb.  14,  1919.) 

NOTE. — The  Retail  Section  of  the  Distribution  of  Perishables  of  the  United  States  Food 
Administration  has  determined  that  any  advance  over  cost  in  excess  of  7  cents  t,o  8  cents 
a  dozen  is  unreasonable  and  will  be  considered  evidence  of  violation  of  the  above  rule. 

The  7  cents  per  dozen  represents  the  maximum  for  stores  conducting  the  cash  and  carry 
or  no  service  plan,  while  the  8  cents  per  dozen  is  the  maximum  margin  for  the  extra 
service  stores  extending  credit  and  delivery. 

Retailer  may  have  benefit  of  fractional  cost  on  any  transaction. — Retailers  whose  deliv- 
ered terminal  costs  figure  in  fractions  may  hav^  the  benefit  of  such  fractional  costs.  For 
example,  if  eggs  cost  at  terminal  delivery  46J  cents  per  dozen,  the  selling  price  may  be 
figured  as  follows  : 

CASH  AND  CARRY  STORES. 


Amount  of  sale. 

Cost. 

Margin. 

Total. 

Fraction 
added. 

Maximum 
selling 
price. 

1  dozen 

Cents. 
46J 

Cents. 

7 

Cents. 
53V 

Cent. 

$0  ^4 

2  dozen  

92£ 

14 

106J 

1 

1  07 

3  dozen.. 

13J>f 

21 

159| 

| 

1  fiO 

The  maximum  selling  price  for  the  extra  service  or  credit  and  delivery  stores  would  be 
1  cent  per  dozen  higher. 

In  determining  margins  at  7  cents  and  8  cents  per  dozen  on  eggs  with  the  fractional 
cost  in  the  dealer's  favor,  the  United  States  Food  Administration  has  given  due  considera- 
tion to  the  rising  costs  of  operation  which  must  be  met  by  the  dealer. 

Margin  for  retailer  who  stored  eggs  during  1918. — The  attention  of  any  retailer  who  was 
the  original  storer  of  eggs  during  the  season  of  1918,  is  called  to  the  fact  that  he  is  still 
governed  by  rule  8  of  the  special  regulations  governing  distributors  of  cold-storage  eggs  in 
respect  to  transactions  in  these  eggs. 

SUPPLEMENT. 


TO    LICENSEES     WHO    ARE     RECEIVERS     OF     POULTRY     OR     EGGS     (BUTTER    AND     OTHER     PRODUCE), 
ON    CONSIGNMENT    OR    AS  -PURCHASERS. 

A  licensee  in  receiving  goods  shipped  in  to  him  acts  in  one  of  two  capacities,  either 
as  an  agent  of  the  shipper  in  selling  commodities  or  as  a  purchaser  of  the  commodities 
from  the  shipper.  Some  licensees  are  engaged  in  both  forms"  of  business  and  confusion 
has  arisen  in  the  minds  of  shippers  as  to  exactly  how  their  shipments  are  to  be  handled. 
Licensees  should  be  guided  by  the  following  principles  : 

(1)  If  the  licensee  acts  as  an  agent  for  the  shipper  in   disposing  of  goods  he  must 
render  an  account   sales   showing   the   sales   made   for   the  account   of  the   shipper,   the 
amount  deducted  by  him  for  compensation,  and  any  other  charges.     In  some  cases  it  is 
the  practice  for  commission   merchants   to  take  to  their  own   account   goods  which  are 
consigned  to  them  as  agents.     Where  an  agent  so  takes  to  account  this  fact  is  required 
to  be  noted  on  the  account  sales  by  the  regulations  of.  the  Food  Administration.     The 
shipper  will  then  kjiow  the  nature  of  the  transaction.     This  requirement  is  in  addition 
to  any  obligation  at  common  law  resting  on  the  receiver  to  obtain  the  consent  of  the 
shipper  to  such   a  transaction.     Licensees  who  handle   commodities   for  shippers   for  a 
certain    compensation,   even    though   not   expressed   in   terms   of   percentage  or   called   a 
commission,  are  none  the  less  commission  merchants,  and  must  comply  with  the  regula- 
tions   governing    commission    merchants. 

(2)  If  the  licensee  is  not  acting  as  agent  for  the  shipper  and  the  intention  is  that 
the  licensee  shall  purchase  from  the  shipper,  this  matter  should  be  clear  to  the  shipper 
as  well  as  the  receiver  of  the  commodities.     The  use  of  expressions  by  the  receiver  in 
connection   with   such   a  transaction   which  would  lead   the   shipper   to   believe  that   the 
receiver  is  acting  as  an  agent  for  the  shipper  is  misleading  and  unfair. 

Purchases  are  made  under  different  arrangements  as  to  price,  more  commonly  in  one 
of  the  following  ways  : 

(a)   The  receiver  agrees  to  pay  the  shipper  a  definite  price  upon  arrival. 

(&)  The  receiver  agrees  to  pay  the  shipper  a  price  Tiaving  a  definite  relation  to  the 
market  price  on  the  day  of  arrival. 

(c)  The  receiver  agrees  to  pay  the  shipper  a  price  to  be  determined  by  the  receiver 
on  the  day  of  arrival. 

Such  agreements  are  not  prohibited  by  the  Food  Administration.  In  the  third  case 
(c)  it  is  clearly  implied  in  the  agreement  that  the  price  to  be  paid  by  the  receiver  shall 
not  be  arbitrary  but  shall  be  reasonable  under  all  the  circumstances  and  shall  bear  a 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES.  625 

proper  relation  to  the  market  value.      The   Food   Administration    will   so   construe   such 
agreements  and  the  parties  should  so  understand  them. 

Where  a  dealer  <is  handling  commodities  in  several  different  ways  the  only  method 
of  making  clear  the  nature  of  any  particular  transaction  is  a  written  or  oral  definite 
understanding.  Cases,  however,  have  been  called  to  our  attention  where  a  licensee 
never  does  any  commission  business,  always  purchases  shipments  at  a  net  price,  and 
where  the  receiver  is  constantly  receiving  shipments  from  shippers  with  whom  he 
has  never  had  any  prior  negotiations.  In  such  cases  the  nature  of  the  business  may 
be  entirely  clear  to  the  shipper  without  a  definite  written  agreement.  The  buyer  should 
show  by  a  memorandum  of  purchase  exactly  what  the  nature  of  the  transaction  is, 
including  the  purchase  price  and  any  deductions  permitted  by  the  contract  of  purchase, 
and  he  must  not  use  any  expression  which  will  lead  the  shipper  to  believe  that  the 
transaction  is  an  agency  transaction.  In  order  to  avoid  misleading  statements  the 
Food  Administration  has  insisted  that  the  licensee  shall  discontinue  the  use  of  the  term 
"  net  return  basis  "  to  describe  purchases.  "  Net  return  basis  "  implies  that  there  is  a 
gross  return  and  that  something  has  been  deducted  to  reach  a  net  return.  It  is  an 
expression  applicable  to  an  agency  transaction  and  not  to  a  purchase. 

XX.  BUTTER. 

A.  SPECIAL    REGULATIONS    GOVERNING    MANUFACTURERS    AND 
DISTRIBUTORS    OF    BUTTER. 

Rule  1  (amended  Dec.  31,  effective  Jan.  6,  1919).  Cold-storage  butter  to  be  sold 
at  reasonable  advance  over  cost. — The  licensee  dealing  in  cold-storage  butter 
shall  sell  such  butter  without  regard  to  the  market  or  replacement  value  at 
the  time  of  sale  at  not  more  than  a  reasonable  advance  over  cost  to  him  of 
the  particular  butter  sold,  provided  that  the  licensee  may  average  by  weight 
the  cost  of  all  cold-storage  butter  of  the  same  grade  which  has  not  already 
been  contracted  to  be  sold.  The  licensee  shall  keep  a  record  of  the  manner  in 
which  such  average  has  been  determined.  When  new  lots  are  added  and  a  new 
average  calculated  the  licensee  shall  include  in  the  new  average  all  stock 
remaining  on  hand  of  lots  already  averaged  at  the  average  cost  previously 
determined.  If  the  cost  of  any  cold-storage  butter  is  averaged,  the  cost  of  all 
cold-storage  butter  must  be  averaged. 

Cost  for  the  purpose  of  this  rule  shall  include : 

1.  Purchase  price. 

2.  Transportation  charges,  if  any  (not  including  drayage). 

3.  Storage  charges  actually  incurred  on  cold-storage  butter. 

4.  Insurance  charges  actually  incurred  on  cold-storage  butter. 

5.  Interest  on  money  invested  at  the  current  rate,  while  butter  is  in  cold 
storage. 

6.  Actual  cost  of  printing  if  the  butter  is  put  in  print  form  from  tubs  or 
cubes. 

Cost  shall  not  include  any  allowance  for  shrinkage  in  weight,  commissions, 
expenses  of  breaking  packages  and  repacking,  or  other  expenses  than  those 
herein  listed.  (Issued  June  19,  1918,  as  to  "cold-storage  butter";  changed 
July  19,  1918,  to  apply  to  all  butter;  changed  Jan.  6,  1919,  to  apply  to  cold- 
storage  butter ;  repealed  Jan.  28,  1919. ) 

NOTE. — In  any  case  where  a  licensee  owns  his  own  cold-storage  warehouse  in  which 
butter  owned  by  him  is  stored  more  than  30  days  he  may  include  in  his  calculation  of 
cost  a  charge  for  warehousing  equal  to  that  ordinarily  paid  to  a  public  warehouse 
for  similar  services. 

Reports  to  le  furnished  on  demand. — The  licensee  must  be  prepared  to  furnish  to  the 
United  States  Food  Administration  or  to  the  Federal  food  administrator  of  his  State 
upon  demand  a  full  report  on  costs  and  margins  charged  or  on  the  maximum  prices 
charged  in  any  given  period  for  any  grade  of  butter  or  any  other  information  which  may 
be  considered  necessary  for  the  purpose  of  this  rule. 

Maximum  margins. — The  Food  Administration  will  consider  the  sale  of  any  grade  of 
butter  by  any  dealer  other  than  a  manufacturer  or  retailer  at  an  advance  over  cost,  as 
hereinbefore  defined,  of  more  than  the  following  margins  as  prima  facie  evidence  of  a 
violation  of  the  food  control  act  and  the  above  rule : 

(a)   One  cent  per  pound  on  car  lot  sales. 

(6)  One  and  one-half  cents  per  pound  on  sales  of  less  than  a  car  lot,  but  amounting 
to  7,000  pounds  or  more. 

(c)  Two  cents  per  pounds  on  sales  of  less  than  7,000  pounds,  but.  amounting  to 
3,500  or  more. 

125547°— 20 40 


626 


HISTORY   OF   PRICES   DURING   THE   WAR. 


(d)  Two  and  one-half  cents  per  pound  on  sales  of  less  than  3,500  pounds,  but  amount- 
ing to  700  pounds  or  more. 

(e)  Three  cents  per  pound  on  sales  less  than  700  pounds  but  amounting  to  100  pounds 
or  more. 

(/)    Thrco  and  three-fourths  cents  per  pound  on  sales  of  less  than  100  pounds. 

In  addition  to  the  selling  margin,  which  normally  should  be  considerably  below  the 
above  maximum  margins,  and  must  in  no  case  exceed  such  maximum  margins,  any  dealer 
who  carries  butter  in  cold  storage  more  than  two  full  calendar  months  may  add  a- margin 
of  not  more  than  1  cent  per  pound,  and  an  additional  one-fourth  cent  per  pound  for 
each  calendar  month  thereafter  during  which  he  carries  the  butter  in  storage.  The 
total  margin  for  carrying  butter  in  cold  storage  shall  not  exceed  2  cents  per  pound. 

The  following  table  indicates  th6  method  by  which  the  dealer  may  calculate  tho  maxi- 
mum amounts  which  may  be  added  to  selling  margins  where  a  dealer  holds  butter  in 
storage  more  than  two  full  calendar  months.  It  should  be  noted  that  a  calendar  month 
does  not  mean  30  days. 


Month. 

May. 

June. 

July. 

Aug. 

Sept. 

Oct. 

Nov. 

Dec. 

Jan. 

Feb. 

Mar. 

Ausnist    

1 

September  

1£ 

i 

October  

li 

11 

1 

November  

1? 

n 

li 

i 

December  '.  

2 

if 

li 

li 

1 

January  

2 

2 

If 

li 

li 

1 

February  

2 

2 

2 

If 

l| 

1£ 

1 

March... 

2 

2 

2 

2 

I' 

li 

1* 

1 

April. 

2 

2 

2 

2 

2 

1! 

I1 

1  1 

1 

May  

2 

2 

2 

2 

2 

S 

If 

l| 

i 

1 

June... 

2 

2 

2 

2 

2 

2 

2 

l| 

If 

1  1 

1 

July 

2 

2 

2 

2 

0 

2 

2 

2 

3 

11 

" 

NOTE. — The  nionihs  in  the  column  at.  the  left  indicate  months  in  which  tho  butter  is 
sold.  The  figures  indicate  cents  per  pound.  For  example,  a  dealer  storing  butter  in  June 
and  selling  in  October  may  add  li  cents  per  pound  to  his  selling  margin,  which  must  in 
no  case  exceed  the  margins  indicated  under  rule  1. 

The  above  maximum  margins  are  not  to  be  regarded  as  fair  normal  margins  or  as  so 
recognized  by  the  Food  Administration.  They  are  intended  to  prevent  speculation  and 
are  purposely  made  wide  enough  to  cover  cases  where  the  methods  of  doing  business  arc 
more  expensive,  to  the  extent  that  such  methods  are  justified.  These  maximum  advances 
must  not  be  exceeded  in  selling  any  lot  of  butter  and  the  prices  charged  by  any  dealer 
must  not  in  any  case  be  more  than  sufficient  to  return  to  him  a  reasonable  profit  en  his 
investment. 

Licensees  will  be  expected  to  sell  butter  in  usual  quantities  to  customers  and  whcro 
it  appears  that  sales  are  being  made  in  smaller  quantities  than  customarily  for  the  pur- 
pose of  charging  larger  margins  than  would  be  proper  on  larger  sales  such  larger  margins 
will  not  be  considered  justifiable.  Larger  margins  are  only  proper  for  sales  of  smaller 
quantities  where  selling  in  small  quantities  is  the  usual  course  of  business  involving  a 
greater  expense  in  operation. 

Where  a  licensee  contracts  to  sell  a  quantity  of  butter  to  be  delivered  in  smaller 
quantities  at  future  dates  the  dealer  must  be  guided  by  the  maximum  margins  indicated 
for  sales  of  the  quantity  contracted  to  be  sold  and  not  for  sales  of  the  amount  of  any 
delivery. 

Sales  from  brancli  houses. — Where  butter  is  transferred  by  any  dealer  to  a  branch 
house  of  such  dealer  in  the  same  or  another  city  such  transfer  shall  not  be  made  at  an 
advance  over  cost  of  more  than  three-fourths  of  a  cent  per  pound,  regardless  of  quantity. 
In  such  case,  however,  when  the  transaction  is  in  as  direct  a  line  of  distribution  as  prac- 
ticable the  branch  house  may  figure  the  transfer  price  as  its  purchase  price  and  may  sell 
butter  at  an  advance  over  cost  on  such  basis  not  greater  than  the  maximum  margins  indi- 
cated above.  If  the  branch  house  transfers  the  butter  to  another  branch  house  of  the 
same  dealer  the  total  maximum  margin  added  by  both  houses  shall  not  be  greater  than 
the  maximum  margin  allowed  to  the  first  branch,  house  by  this  rule. 

Collusive  sales. — Any  sale  by  a  dealer  to  another  dealer  at  a  price  higher  than  the 
price  which  the  second  dealer  would  have  to  pay  in  buying  on  the  open  market  will 
be  considered  evidence  of  a  collusive  sale  intended  to  defeat  the  purpose  of  rule  1  by 
increasing  the  purchaser's  cost  and  the  price  which  he  may  charge  upon  a  rising 
market. 

Rule  2  (amended  Dec.  31,  to  be  effective  Jan.  6,  1919).  Manufacturer's  mar- 
gins on  sales  of  cold-storage  butter. — The  manufacturer  in  selling  butter  manu- 
factured and  placed  in  cold  storage  by  him  snail  be  governed  by  rule  1,  and  the 
maximum  margins  indicated  therewith,  except  that  in  figuring  his  cost  as  pro- 
vided in  rule  1,  he  shall  take  instead  of  the  purchase  price  the  market  quota- 
tion on  the  kind  and  grade  of  butter  placed  in  cold  storage  as  quoted  in  a 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  627 

well-recognized  daily  commercial  price  current  in  the  city  where  and  on  the 
day  when  the  goods  are  placed  in  storage.  In  case  there  is  no  well-recognized 
daily  price  current  in  the  city  where  the  goods  are  stored  then  he  may  use  the 
quotation  given  in  a  daily  commercial  price  current  in  the  large  market  nearest 
the  place  of  storage.  From  this  must  be  deducted  the  amount  by  which  the 
freight  from  the  point  of  manufacture  to  the  place  of  storage  is  less  than  the 
freight  from  the  place  of  manufacture  to  such  large  market.  In  case  the 
freight  from  the  place  of  manufacture  to  the  place  of  storage  exceeds  the 
freight  from  the  place  of  manufacture  to  such  large  market,  the  excess  may 
be  added  to  the  market  quotation.  (Rule  issued  June  19,  1918,  provided  meth- 
ods of  computing  purchase  price  of  manufacturer  who  acts  as  wholesaler  or 
jobber.  Dec.  12,  1918.  maximum  margin  on  butter  set  at  5  cents  per  pound  over 
cost  of  butter  fat.  Jan.  6,  1919,  maximum  margins  indicated  for  cold  storage 
butter.  Repealed  Jan.  28,  1919.) 

Bule  3  (amended  Dee.  31,  to  be  effective  Jan.  6,  1919).  Commissions  limited. — 
No  licensee  shall  pay  and  no  commission  merchant  shall  receive  a  commission 
on  cold-storage  butter  of  more  than  the  following: 

Car  lot  sales f  cent  per  pound 

Sales  less  than  car  lot 1  cent  per  pound 

The  licensee  shall  inform  any  commission  merchant  selling  butter  for  him 
of  the  maximum  permitted  price  at  which  such  butter  may  be  sold. 

The  commission  merchant  shall  not  charge  both  a  commission  and  also  a 
profit  on  cold-storage  butter.  (Rule  issued  June  19,  1918,  provided  commission 
on  cold-storage  butter  which  was  subsequently  changed  as  to  fresh  and  cold 
.storage  on  July  19,  1918,  Aug.  8,  1918,  and  Jan.  6,  1-919;  repealed  Jan.  28,  1919.) 

Snle  4  (amended  Dec.  31,  to  be  effective  Jan.  6,  1919).  Intel-trading  restricted. — 
The  licensee  in  selling  cold-storage  butter  shall  keep  it  moving  to  the  con- 
sumer in  as  direct  a  line  as  practicable  and  without  unreasonable  delay.  Tlie 
direct  line  of  distribution  of  butter  is  from  a  licensee  in  any  of  the  following 
classes  to  a  licensee  in  any  succeeding  class : 

Class  1.  Manufacturers. 

Class  2.  Wholesalers  and  jobbers.  These  include  all  persons,  firms,  corpora- 
tions, and  associations  who  distribute  butter  in  any  way,  except  at  retail,  and 
all  manufacturers  who  perform  services  customarily  performed  by  wholesalers 
and  jobbers. 

Class  3.  Retailers,  hotels,  restaurants,  and  institutions. 

NOTE. — Any  transactions  that  savor  of  dealing  in  which  a  profit  accrues  to  the 
dealer  without  corresponding  service,  are  clear  violations  of  the  rule  and  will  subject 
the  offender  to  revocation  of  his  license  and  to  such  other  penalty  as  the  law  provides. 

The  following  types  of  sales  between  dealers  will  be  considered  justifiable,  but  sales 
other  than  those  described  between  dealers  in  the  same  class  will  be  considered  as  prima 
facie  evidence  of  violation  of  general  rule  6. 

A.  A   sale  by  any  dealer  in  butter  to  a  dealer  in  any  succeeding  class  will  be  consid- 
ered as  In  the  direct  line  of  distribution. 

B.  One  sale,  nnd   only  one  sale,  of  the  same  goods  between  dealers  in   class  2  in  the 
same   city   will   be   considered   justifiable   when    necessary    to    supply    the   reasonable   10- 
<!<iirernents   of   the   buyer's    business,    without   the    special    consent   of   the   local    Federal 
Food  Administrator,  provided,   however,   that  a   second  sale  of  the  same  goods  between 
dealers  in     class  2  in  the  same  city  will  be  permitted  without  the  consent  of  the  local 
Federal  Food  Administrator  if  this  sale  is  made  at  an  advance  over  cost  cf  not  more 
than  one-half  of  the  margins  indicated  above,  and  provided  that  the  seller  notifies  the 
buyer  that  this  is  a  second  sale. 

C.  In  addition  to  such  resales  as  are  otherwise  indicated  as  justifiable,  sales  between 
dealers  in  class  2  in  different  cities  will  be  considered  justifiable,  provided,  that  an  actual 
delivery   of   the   butter  follows   the   sale,   and   that   the   shipment   is   for   the  purpose  of 
obtaining  supplies  from  primary  markets  for  reasonable  requirements  of  the  purchaser's 
business  ;   provided   further,  that   not  more   than   three   such   sales  of  any   lot   of  butter 
between    dealers   in    class    2    shall   be    made   without    special    permission ;    and    the  third 
sale  shall   be  made  at  an  advance  over  cost   of  not   more   than   one-half  of  the  above 
margins. 

1).  Any  resale  between  dealers  without  any  advance  over  cost  will  be  considered  as 
justifiable  in  addition  to  such  other  resales  as  are  permitted. 

(Rule  issued  June  19,  1918,  governed  resales  of  cold-storage  butter;  changed 
July  19,  1918,  to  include  all  butter,  and  Jan.  €,  1919,  to  cold-storage  tmtter;  re- 
pealed Jan.  28,  1919.) 


628  HISTORY   OF   PRICES   DURING   THE   WAR. 

Rule  5  (amended  Dec.  31,  to  be  effective  Jan.  6,  1919).  The  licensee  making 
second  sale  in  same  class  to  notify  buyer. — The  licensee  in  class  2  as  defined 
above  who  purchases  cold-storage  butter  from  another  wholesaler  or  jobber  in 
such  class,  or  from  a  manufacturer  performing  the  services,  or  a  wholesaler 
or  jobber,  and  who  resells  to  another  dealer  in  class  2,  shall  notify  such  dealer 
of  the  prior  sales  of  such  butter  within  that  class  of  which  he  has  knowledge. 
(Issued  June  19,  1918,  as  to  cold-storage  butter;  changed  July  19,  1918,  to  all 
butter ;  changed  Jan.  6,  1919,  to  cold-storage  butter ;  repealed  Jan.  28,  1919. ) 

NOTE. — This  information  should  be  disclosed  at  the  time  of  the  transaction  and  should 
be  placed  by  the  seller  upon  the  invoice  in  order  that  there  shall  be  a  permanent  record. 

Rule  10.  Certificate  of  value  to  be  furnished  to  cold-storage  warehousemen. — 
The  licensee  storing  butter  with  a  cold-storage  warehouseman  upon  which  the 
warehouseman  either  directly  or  indirectly  loans  money  shall,  upon  request  of 
such  warehouseman,  file  with  him  a  certificate  stating  the  market  value  of  the 
goods  stored  and  shall  make  no  false  or  misleading  statement  in  such  certificate 
nor  shall  he  fail  to  maintain  the  margin  required  by  the  regulations  of  the  Food 
Administration  on  loans  made  by  cold-storage  warehousemen.  (Issued  Feb.  7, 
1918,  as  to  "  commodities  required  to  be  licensed  "  ;  repealed  Jan.  28,  1919.) 

B.  ADDITIONAL   REGULATIONS   GOVERNING   BROKERS,   COMMISSION 
MERCHANTS,  AND  AUCTIONEERS  DEALING  EITHER  IN  FRESH  OR 
COLD-STORAGE  BUTTER. 

Rule  1.  Commission  or  brokerage  not  to  be  unreasonable  or  discriminatory. — 
The  licensee  shall  not  charge,  directly  or  indirectly,  an  unjust,  exorbitant,  un- 
reasonable, discriminatory,  or  unfair  commission  or  brokerage  on  the  sale  of 
butter.  (Dec.  23,  1918;  repealed  Jan.  6,  1919.) 

NOTE. — The  Food  Administration  in  enforcing  this  rule  will  insist  that  any  proposed 
increase  in  rates  be  submitted  to  the  local  Federal  food  administrator,  and  that  the 
reason  for  any  increased  rate  over  the  prewar  normal  be  justified  to  him,  subject  to  the 
general  supervision  of  the  United  States  Food  Alministration  before  such  increased  rates 
are  put  into  effect. 

The  rates  to  be  charged  by  a  commission  merchant  are  more  specifically  treated  under 
A,  rule  3,  supra. 

Rule  2.  Prompt  remittance  and  proper  account  sales  to  be  rendered. — The 
licensee  shall  remit  promptly  following  the  sale  of  butter  received  on  consign- 
ment for  sale  or  distribution,  and  shall  render  to  the  consignor  an  account  show- 
ing the  true  sales  and  with  charges  only  for  services  actually  performed  and 
expenses  actually  incurred  by  the  licensee.  (Issued  Nov.  1,  1917,  as  to  "food 
commodities";  repealed  Jan.  6,  1919.) 

NOTE. — Where  a  commission  merchant  receives  a  consignment  of  butter  and  guarantees 
to  the  consignor  a  definite  selling  price,  he  must  show  on  the  account  sales  the  actual 
price  at  which  the  goods  are  sold,  together  with  services  actually  performed  and  ex- 
penses actually  incurred,  and  as  a  separate  item  must  show  any  sum  paid  to  the  con- 
signor by  reason  of  the  commission  merchant's  contract  of  guaranty.  Failure  to  do  this 
will  be  considered  a  violation  of  the  above  rule  governing  commission  merchants  and 
also  a  misstatement  of  the  price  at  which  commodities  are  being  sold  in  violation  of 
general  rule  19. 

From   November   1,   1917,   to  April   16,   1918,   the  rule  governing  all   commission   mer- 
chants, brokers,  and. auctioneers  which  limited  their  charges  to     "  *      *      *     that  which 
ordinarily   and   customarily   prevails   under   normal   conditions   in   the   locality   in   which 
their  business  is  conducted     :  "  applied  to  these  dealers  in  perishables. 

C.  ADDITIONAL   SPECIAL  REGULATIONS  GOVERNING  RETAILERS   IN 

BUTTER. 

The  attention  of  all  retail  dealers  in  butter  is  called  to  Rule  A-l  of  the  above 
regulations,  which  is  headed :  "  Rule  1.  Butter  to  be  sold  at  a  reasonable  advance 
over  cost." 

The  United  States  Food  Administration  will  regard  any  advance  in  excess 
of  6  to  7  cents  per  pound  over  cost  (as  defined  in  rule  1)  as  unreasonable  and 
as  evidence  of  violation  of  rule  1.  The  6  cents  per  pound  represents  the 
maximum  margin  for  stores  conducted  on  the  cash  and  carry  or  no-service 
pjan,  while  7  cents  per  pound  is  the  maximum  margin  for  the  extra-service 
stores  extending  credit  and  delivery. 

Retailer  may  have  benefit  of  fractional  cost  on  any  transaction. — Retailers 
whose  delivered  terminal  costs  figure  in  fractions  may  have  the  benefit  of  such 
fractional  costs  on  any  transaction.  For  example,  if  butter  costs  at  terminal 
delivery  46^  cents  per  pound,  the  selling  price  may  be  figured  as  follows : 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES. 
'  CASH  AND  CARRY   STORES. 


629 


Amount  of  sale. 

Cost. 

Margin. 

Total. 

Fraction 
added. 

Maximum 
selling 
price. 

1  pound  

Cents. 
46| 

Cents. 
6 

Cents. 
521 

Cents. 

$0  53 

2  pounds  

92* 

12 

104  \ 

i 

1  05 

3  pounds  ... 

138| 

18 

156| 

* 

1  57 

The  maximum  selling  price  for  the  extra  service  or  credit  and  delivery  stores 
would  be  1  cent  per  pound  higher. 

In  determining  margins  at  6  cents  and  7  cents  a  pound  on  butter  with  the 
fractional  costs  in  the  dealer's  favor,  the  United  States  Food  Administration 
has  given  due  consideration  to  the  rising  costs  of  operation  which  must  be  met 
by  the  dealer. 

In  addition  to  the  above  margins  the  retailer  who  carries  butter  in  cold 
storage  more  than  two  full  calendar  months  may  add  not  more  than  1  cent  a 
pound  and  an  additional  one-fourth  cent  a  pound  a  month  for  each  calendar 
month  thereafter  during  which  he  carries  the  butter  in  cold  storage.  The  total 
amount  for  carrying  butter  in  cold  storage  so  added,  however,  shall  not  exceed 
2  cents  per  pound. 

The  food  administration  will  consider  any  sale  of  butter  by  a  retail  dealer 
at  a  greater  margin  than  herein  outlined  as  evidence  subjecting  the  dealer  to  a 
revocation  of  his  license  or  such  other  penalty  as  the  law  provides. 

XXI.  CHEESE. 

A.   SPECIAL  REGULATIONS  GOVERNING  MANUFACTURERS  AND  DIS- 
TRIBUTORS  OF  ALL  KINDS   OF   CHEESE. 

Rule  1.  Cheese  to  be  sold  at  reasonable  advance  over  cost.— The  licensee  deal- 
ing in  cheese  shall  sell  cheese  without  regard  to  market  or  replacement  value  at 
not  more  than  a  reasonable  advance  over  the  cost  of  the  particular  cheese  sold, 
provided  that  the  licensee  may  average  by  weight  the  cost  of  all  cheese  of  the 
same  kind,  shape,  and  grade  which  have  not  already  been  contracted  to  be  sold. 
The  licensee  shall  keep  a  record  of  the  manner  in  which  such  average  has  been 
determined.  When  new  lots  are  added  and  a  new  average  calculated,  the 
licensee  shall  include  in  the  new  averaging  all  stock  remaining  on  hand  of  lots 
already  averaged  at  the  average  cost  of  such  lots  previously  determined.  If  the 
cost  of  any  cheese  is  averaged,  the  cost  of  all  cheese  must  be  averaged. 
(Issued  June  32,  1918;  margins  on  different  grades  of  cheese  changed  July  12, 
1918,  and  Aug.  2,  1918;  repealed  Jan.  6,  1919.) 

Cost  for  the  purpose  of  this  rule  shall  include: 

1.  Purchase  price. 

2.  Transportation  charges,  if  any  (not  including  drayage). 

3.  Storage  charges  actually  incurred,  provided  that  the  cheese  has  been  in 
storage  more  than  60  days. 

4.  Insurance  charges  actually  incurred,  provided  that  the  cheese  has  been  in 
storage  more  than  60  days. 

5.  Interest  on  money  invested  at  the  current  rate,  provided  that  the  cheese 
has  been  in  storage  more  than  60  days. 

6.  Actual  cost  of  paraffining,  if  any,  not  to  exceed  one-fourth  cent  per  pound. 

7.  Actual  cost  of  reboxing  or  dividing  the  type  of  American   or  Cheddar 
cheese,  known  as  Twins  or  double  or  triple  Daisies,  into  smaller  units,  but  in 
no  case  exceeding  one-half  cent  per  pound. 

Cost  shall  not  include  any  allowance  for  shrinkage  in  weight,  commissions, 
expenses  of  breaking  packages  and  repacking,  or  any  other  expenses  than  those 
herein  listed. 

NOTE. — In  any  case  where  a  dealer  owns  his  own  storage  warehouse  in  which  cheese  is 
stored  more  than  60  days  the  dealer  may  include  in  his  calculation  of  cost  a  charge  for 
warehousing  equal  to  that  ordinarily  paid  to  a  public  warehouse  for  similar  services. 
Where  cheese  is  carried  in  a  private  warehouse  without  refrigeration,  refrigeration  rates 
must  not  be  charged. 

The  dealer  must  calculate  the  actual  cost  of  paraffining  and  will  not  be  permitted  arbi- 
trarily to  take  one-fourth  cent  per  pound  as  this  cost.  In  cases  where  the  cheese  is 
reweighed  after  paraffining  the  increased  weight  must  be  taken  into  consideration  in 
determining  the  cost. 


630  HISTORY   OF   PEI€ES   DURING   THE   WAR. 

Reports  to  be  furnished  cm  demand. — The  licensee  must  bo  prepared  to 
furnish  to  the  United  States  Food  Administration  or  to  the  Federal  food 
administrator  of  his  State  upon  demand  a  full  report  on  costs  and  margins 
charged  or  on  the  maximum  prices  charged  in  any  given  period  for  any  kind  of 
cheese  or  any  other  information  which  may  be  considered  necessary  for  the 
purpose  of  this  rule. 

The  maximum  margins  indicated  by  the  Food  Administration  are  not  to  be 
regarded  as  fair  normal  margins  or  as  so  recognized  by  the  Food  Administra- 
tion. They  are  intended  only  to  prevent  speculation  and  are  purposely  made 
wide  enough  to  cover  cases  where  the  methods  of  doing  -business  aTe  more 
expensive,  to  the  extent  that  such  methods  are  justified.  These  maximum 
advances  must  not  be  exceeded  in  selling  any  lot  of  cheese,  and  the  prices 
charged  by  any  dealer  must  not  in  any  case  be  more  than  sufficient  to  return 
to  iiini  a  reasonable  profit  on  his  investment. 

Sales  from  branch  houses. — Where  cheese  is  transferred  by  any  denier  to 
a  branch  house  of  such  dealer  in  the  same  or  another  city  such  transfer  shall 
not  be  considered  a  sale  governed  by  the  maximum  margins  indicated  i?or 
sales.  No  advance  over  cost  for  such  transfer  will  be  allowed  except  where 
the  main  house  actually  handles  the  cheese,  in  which  case  advances  over  cost 
for  transfer  not  greater  than  those  indicated  below  will  be  permitted,  provided 
the  transaction  is  in  as  direct  a  line  of  distribution  as  practicable ;  and  the 
branch  house  may  figure  the  transfer  price  (see  below)  as  its  purchase  price 
and  may  sell  cheese  at  an  advance  over  cost  on  such  basis  not  greater  than  the 
maximum  margins  indicated  below.  If  the  branch  house  transfers  the  cheese 
to  another  branch  house  of  the  same  dealer,  the  total  margin  added  by  both 
branch  houses  must  not  be  greater  than  the  maximum  margins  indicated  below. 

Collusive  sales. — Any  sale  by  a  dealer  to  another  dealer  at  a  price  higher 
than  the  price  which  the  second  dealer  would  have  to  pay  in  buying  on  tho 
open  market  will  be  considered  evidence  of  a  collusive  sale  intended  to  defeat 
the  purpose  of  rule  1  by  increasing  the  purchaser's  cost  and  the  price  which 
he  may  charge  upon  a  rising  market. 

The  price  on  the  open  market  does  not  necessarily  mean  the  price  established 
by  a  dairy  board,  especially  when  the  dairy  board  does  not  hold  its  meetings 
daily. 

Cost  in  the  ease  of  purchases  of  ungraded  eheesc, — The  cost  of  any  grade 
of  cheese  must  be  figured  on  the  purchase  price  of  that  grade.  Where  a  dealer 
purchases  ungraded  •cheese  at  one  price  per  pound  regardless  of  the  grades 
contained  in  the  lot  he  must  not  figure  the  purchase  price  per  pound  of  any 
part  of  this  cheese  higher  than  the  price  per  pound  actually  paid  for  the 
entire  lot. 

The  growing  practice  due  to  present  market  conditions  of  buying  cheese, 
particularly  round  Swiss,  from  the  factory  before  it  is  sufficiently  matmvd 
to  permit  of  the  determination  of  the  quality  of  the  product  increases  ma- 
terially the  speculative  risk  assumed  by  the  buyer.  It  also  results  in  lowering 
the  standard  of  quality.  The  Food  Administration  is  strongly  of  the  opinion 
that  this  tendency  should  be  stopped  as  uneconomical  and  believes  that  the 
installation  of  grades  will  do  much  to  stabilize  values  in  this  product.  Where 
dealers  sell  on  grade  they  can  reduce  their  speculative  risk  if  they  do  not 
purchase  the  cheese  until  its  quality  can  be  reasonably  determined.  The  above 
requirement  as  to  figuring  costs  is  intended  to  accomplish  this  result. 

MAXIMUM   MARGINS. 

The  Food  Administration  will  consider  the  sale  of  any  cheese  of  any  of  the  follow- 
ing kinds  by  any  dealer  other  than  the  manufacturer  or  the  retailer  at  an  advance 
over  cost  as  hereinbefore  defined  of  more  than  the  following  margins  as  prima  facie 
evidence  of  a  violation  of  the  food  control  act  and  the  above  rule. 

Licensees  will  be  expected  to  sell  cheese  in  usual  quantities  to  customers  and  where 
it  appears  that  sales  are  being  made  in  .smaller  quantities  than  customarily  for  the 
purpose  of  charging  larger  margins  than  would  he  proper  on  larger  sales  such  larger 
margins  will  not  be  considered  justifiable.  Larger  margins  are  only  proper  for  sites 
of  smaller  quantities  where  selling  in  small  quantities  is  thp  usual  course  of  business 
involving  a  greater  expense  in  operation. 

Where  a  licensee  contracts  to  sell  a  quantity  of  cheese  to  be  delivered  in  smaller 
quantities  at  future  dates  the  dealer  must  be  guided  by  the  maximum  margins  indi- 
cated for  sales  of  the  quantity  contracted  to  be  sold  and  not  for  sales  of  the  amount 
of  any  delivery. 


GOVERNMENT  REGULATIONS   RELATING  TO   PRICES.  631 

/ 

AMERICAN     OU     CHEDDAR     CHEESE. 

(a)   Three-fourths  cent  per  pound  on  car-lot  sales. 

(6)  One  and  one- fourth  cents  per  pound  on  sales  less  than  a  car  lot  but  amounting 
to  7,000  pounds  or  more. 

(c)  One    and    three-fourths    cents    per    pound    on    sales    less    than    7,000    pounds    but 
amounting  to  4,000  pounds  or  more. 

(d)  Two  and  one-half  cents  per  pound  on  sales  less  than  4,000  pounds  but  amount- 
ing to  1,000  pounds  or  more. 

(e)  Three   cents  per  pound  on   sales   less  than   1,000   pounds  but  amounting   to  100 
pounds  or  more. 

(/')   Three  and  one-half  cents  per  pound  on  sales  less  than  100  pounds. 

In  addition  to  the  selling  margin,  which  normally  should  be  considerably  below 
the  above  maximum  margins,  a  further  margin  may  be  added  where  American  or 
Cheddar  cheese  is  held  in  a  warehouse  for  more  than  30  days,  of  not  to  exceed  one- 
fourth  cent  per  pound  per  month  for  each  and  every  month  after  the  30-day  period 
during  which  the  cheese  is  held  in  the  warehouse  by  any  licensee,  but  in  no  case 
shall  the  amount  so  added  exceed  2  cents  per  pound  and  no  further  amount  shall 
be  added  by  any  licensee  after  nine  months  from  the  date  of  original  storage. 

Transfer  margins. — The  margins  for  transfer  of  American  or  Cheddar  cheese  to  a 
branch  house  where  the  main  house  actually  handles  the  cheese  shall  not  exceed  one- 
half  cent  per  pound  regardless  of  the  quantity. 

BOUND   Oil   TUB   SWISS    CHEESE- 

(a)    One  and  three- fourths  cents  per  pound  on  car-lot  sales. 

(&)  Two  and  one-half  cents  per  pound  on  sales  less  than  a  car  lot  but  amounting 
to  6,000  pounds  or  more. 

(c)  Three*  and  one-half  cents  per  pound  on  sales  less  than  6,000  pounds  but  amount- 
ing to  3,000  pounds  or  more. 

(d)  Four   cents  per   pound   on   sales  less   than   3,000   pounds   but   amounting   to    ouc 
tub  or  more. 

(c)  Five  cents  per  pound  on  sales  less  than  one  tub  but  amounting  to  120  pounds 
or  more. 

(f)  Eight  cents  per  pound  on  sales  less  than  120  pounds. 

In  addition  to  the  selling  margin,  which  should  normally  be  considerably  below 
the  above  maximum  margin,  a  further  margin  may  be  added  where  round  or  tub  Swiss 
cheese  is  held  in  a  warehouse  for  more  than  30  days,  not  to  exceed  one-fourth  cent 
per  pound  per  month  for  each  and  every  month  after  the  30-day  period  during  which 
the  cheese  is  held  in  the  warehouse  by  the  licensee,  but  in  no  case  shall  the  amount 
so  added  exceed  2  cents  per  pound  and  no  further  amount  shall  be  added  by  any 
licensee  after  nine  months  from  date  of  original  storage. 

Transfer  margins. — The  margins  for  transfer  of  round  or  tub  Swiss  cheese  to  a 
branch  house  where  the  main  house  actually  handles  the  cheese  shall  not  exceed  1  cent 
per  pound  regardless  of  quantity. 

BLOCK     SWISS     CHEESE. 

(a)    One  cent  per  pound  on  car-lot  sales. 

(Z>)  One  and  three-eighths  cents  per  pound  on  sales  less  than  a  car  lot  but  amount- 
ing to  8,000  pounds  or  more. 

(c)  Two   cents  per  pound   on   sales  less   than   8,000   pounds   but   amounting   to    1,500 
pounds  or  more. 

(d)  Two  and  one-half  cents  per  pound  on  sales  less  than   1,500  pounds  but,  amount- 
ing to  750  pounds  or  more. 

(c)  Three  cents  per  pound  on  sales  less  than  750  pounds  but  amounting  to  150 
pounds  or  more. 

(f)    Four  and  one-half  cents  per  pound   on   sales  less  than  150  pounds. 

In  addition  to  the  selling  margin,  which  should  normally  be  considerably  below  the 
above  maximum  margins,  a  further  margin  may  be  added  where  block  Swiss  cheese 
is  held  in  a  warehouse  for  more  than  30  days,  not  to  exceed  one-fourth  cent  per 
pound  per  month  for  each  and  every  month  after  thel  30-day  period  during  which 
the  cheese  is  held  in  the  warehouse  by  any  licensee,  but  in  no  case  shall  the  amount 
so  added  exceed  2  cents  per  pound  and  no  further  amount  shall  be  added  by  any 
licensee  after  nine  months  from  the  date  of  original  storage. 

Transfer  margins. — The  margins  for  transfer  of  block  Swiss  cheese  to  a  branch 
house  where  the  main  house  actually  handles  the  cheese  shall  not  exceed  three-fourths 
cent  per  pound  regardless  of  quantity. 


632  HISTORY   OF  PRICES   DURING  THE  WAR. 

BRICK,    LIMBURGER,    AND    MUNSTER    CHEESE. 

(a)  One  and  one-fourth  cents  per  pound  on  car-lot  sales. 

(b)  One  and  five-eighths  cents  per  pound  on  sales  less  than  a  car  lot,  but  amounting 
to  6,000  pounds  or  more. 

(c)  Two  and  one-half  cents  per  pound  on  sales  less  than  6,000  pounds,  but  amounting 
to  2,400  pounds  or  more. 

(d)  Three  cents   per  pound~bn  sales  less  than  2,400  pounds,   but   amounting   to  600 
pounds  or  more. 

(e)  Three  and  one-half  cents  per  pound  on  sales  less  than  600  pounds,  but  amounting 
to  120  pounds  or  more. 

(/)   Five  cents  per  pound  on  sales  less  than  120  pounds. 

In  addition  to  the  selling  margin  which  should  normally  be  considerably  below  the 
above  maximum  margins,  a  further  margin  may  be  added  where  brick,  Limburger,  or 
Munster  cheese  is  held  in  a  warehouse  for  more  than  30  days,  not  to  exceed  three- 
eighths  cent  per  pound  for  the  first  month  after  the  30-day  period  and  one-fourth  cent 
per  pound  per  month  for  each  of  the  following  months  thereafter  during  which  the 
cheese  is  held  in  the  warehouse  by  any  licensee  ;  but  in  no  case  shall  the  amount  so 
added  exceed  11  cent's  per  pound  and  no  further  amount  shall  be  added  by  any  licensee 
after  six  months  from  the  date  of  original  storage. 

Transfer  margins. — The  margins  for  transfer  of  brick,  Limburger,  or  Munster  cheese 
to  a  branch  house  where  the  main  house  actually  handles  the  cheese  shall  not  exceed" 
three-fourths  cent  per  pound,  regardless  of  quantity. 

Rule  2.  Manufacturers  who  perform  services  of  dealer  or  assembler. — Any 
manufacturer  who  acts  also  as  an  assembler,  wholesaler,  or  jobber  shall  be 
subject  in  such  sales  to  the  rules  and  margins  governing  assemblers,  whole- 
salers, and  jobbers,  provided  that  instead  of  the  purchase  price  as  an. assembler, 
wholesaler,  or  jobber  he  shall  either — 

(1)  Compute  the  cost  of  raw  materials  and  the  expense  of  manufacture;  or 

(2)  In  the  case  of  American  or  Cheddar  cheese,  take  the  price  during  the 
10  days  after  the  cheese  is  manufactured  on  the  shape  and  grade  of  cheese  in 
the  established  primary  market  on  the  basis  of  which  the  cheese  is  usually 
sold  by  manufacturers.     (Issued  June  12,  1918;  repealed  Jan.  6,  1919.) 

Rule  3.  Commissions  not  to  be  unreasonable. — No  licensee  shall  pay,  and  no 
commission  merchant  shall  receive,  an  unreasonable  or  exorbitant  commission 
in  connection  with  the  sales  of  cheese. 

The  licensee  shall  inform  any  commission  merchant  selling  cheese  for  him  of 
the  maximum  permitted  price  at  which  such  cheese  may  be  sold.  (Rule  issued 
June  12,  1918,  provided  commission  of  one-half  cent  per  pound.  Changed 
Aug.  2,  1918,  to  present  form.  Repealed  Jan.  6,  1919.) 

NOTE. — «  Ten  days  after  the  cheese  is  manufactured  *'  means  10  days  after  the  cheese 
is  removed  from  the  hoops  and  placed  in  the  curing  room. 

Under  rule  1  the  selling  price  may  not  be  increased  by  reason  of  the  payment  of  a 
commission.  Commissions  higher  than  those  indicated  below  will  be  considered  prima 
facie  unreasonable  and  exorbitant. 

(a)  Maximum  commissions. — In  the  case  of  American  or  Cheddar  cheese  one-half 
cent  per  pound  on  car  lots  and  1  cent  per  pound  on  less  than  car  lots. 

<&)  In  the  case  of  round  or  tub  Swiss  cheese  II  cents  per  pound  on  car  lots  and  li 
cents  per  pound  on  less  than  car  lots. 

(o  In  the  case  of  block  Swiss  cheese  1  cent  per  pound  on  car  lots  and  li  cents  per 
pound  on  less  than  car  lots. 

(d)  In  the  case  of  brick,  Limburger,  and  Munster  cheese  1  cent  per  pound  on  car  lots 
and  1|  cents  per  pound  on  less  than  car  lots. 

It  should  be  understood  that  the  above  are  maximum  commissions  which  may  at  times 
be  in  excess  of  reasonable  commissions. 

Rule  4.  Intertrading  restricted. — The  licensee  in  selling  cheese  shall  keep  it 
moving  to  the  consumer  in  as  direct  a  line  as  practicable  and  without  unreason- 
able delay.  The  direct  line  of  distribution  of  cheese  is  from  a  licensee  in  any  of 
the  following  classes  to  a  licensee  in  any  succeeding  class.  (Issued  June  12, 
1918;  repealed  Jan.  6,  1919.) 

Class  1.  Manufacturers. 

Class  2.  Assemblers,  wholesalers,  and  jobbers,  including  all  licensees  who 
receive  cheese  from  manufacturers  and  grade  and  assemble  cheese  for  sale,  or 
who  distribute  it  in  any  way  except  at  retail,  and  all  manufacturers  who  per- 
form the  service  customarily  performed  by  an  assembler,  wholesaler,  or  jobber. 

Class  3.  Retailers,  hotels,  restaurants,  and  institutions. 

NOTE. — Any  transactions  that  savor  of  dealing  in  which  a  profit  accrues  to  the  dealer 
without  corresponding  service  are  clear  violations  of  the  rule  and  will  subject  the  offender 
to  revocation  of  his  license  and  to  such  other  penalty  as  the  law  provides. 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  633 

The  following  kinds  of  sales  between  dealers  will  be  considered  justifiable,  but  sales 
other  than  those  described  between  dealers  in  the  same  class  will  be  considered  as 
prima  facie  evidence  of  violation  of  the  rule  : 

A.  A  sale  by  any  dealer  in  cheese  to  a  dealer  in  any  succeeding  class  will  be  con- 
sidered as  in  the  direct  line  of  distribution. 

B.  One  sale  and  only  one  sale  of  the  same  cheese  between  dealers  in  class  2  in  the 
same  city  will  be  considered  justifiable  when  necessary  to  supply  the  reasonable  require- 
ments  of   the   buyer's   business,   without  the  special   consent  of   the  local   Federal   food 
administrator,  provided,  however,  that  a  second  sale  of  the  same  cheese  between  dealers 
in  class  2  in  the  same  city  will  be  permitted  without  the  consent  of  the  local  Federal 
food  administrator  if  this  sale  is  made  at  an  advance  over  cost  of  not  more  than  one- 
half  of  the  margin  indicated  above,  and  provided  that  the  seller  notifies  the  buyer  that 
this  is  a  second  sale. 

C.  In  addition  to  such  sales  as  are  otherwise  indicated  as  justifiable,  sales  between 
dealers    in   class   2    in    different    cities   will    be    considered    justifiable,    provided   that   an 
actual  delivery  of  the  cheese  follows  the  sale,  and  that  the  shipment  is  for  the  purpose 
of  obtaining  supplies  from  primary  markets  for  the  reasonable  requirements  of  the  pur- 
chaser's business  ;  provided  further,  that  not  more  than  three  such  sales  are  made  of  any 
lot  of  cheese  without  special  permission. 

D.  Any   sale   between   dealers   without   any   advance   over  cost  will  be  considered  as 
justifiable  in  addition  to  such  other  sales  as  are  permitted. 

Rule  5.  The  licensee  making  a  second  sale  in  the  same  class  to  notify  buyer. — 
The  licensee  in  class  2  as  deiined  in  rule  4  who  purchases  cheese  from  another 
assembler  or  dealer  in  such  class  or  from  a  manufacturer  performing  the  serv- 
ices of  an  assembler  or  dealer  and  who  sells  to  another  dealer  in  class  2,  shall 
notify  such  dealer  of  the  prior  sale  and  of  all  other  prior  sales  of  such  cheese 
within  that  class  of  which  he  has  knowledge.  (Issued  June  12,  1918;  repealed 
Jan.  6,  1919.) 

NOTE. — This  information  should  be  disclosed  at  the  time  of  the  transaction  and  should 
be  placed  by  the  seller  upon  the  invoice  in  order  that  there  shall  be  a  permanent  record. 

B.  ADDITIONAL     REGULATIONS     GOVERNING     COMMISSION     MER- 
CHANTS, BROKERS,  AND  AUCTIONEERS  DEALING  IN  CHEESE. 

Rule  1.  Commission  or  brokerage  not  to  be  unreasonable  or  discriminatory. — 

The  licensee  shall  not  charge,  directly  or  indirectly,  an  unjust,  exorbitant,  un- 
reasonable, discriminatory,  or  unfair  commission  or  brokerage  on  the  sale  of 
cheese.  (Issued  Dec.  9,  1918;  repealed  Jan.  6,  1919.) 

NOTE. — The  Food  Administration  in  enforcing  this  rule  will  insist  that  any  proposed 
increase  in  rates  be  submitted  to  the  local  Federal  food  administrator  and  that  the 
reason  for  any  increased  rate  over  the  prewar  normal  be  justified  to  him,  subject  to  the 
general  supervision  of  the  United  States  Food  Administration,  before  such  increased  rates 
are  put  into  effect. 

The  rates  to  be  charged  by  a  commission  merchant  are  more  specifically  treated 
under  A,  rule  3,  supra. 

Rule  2.  Prompt  remittance  and  proper  account  sales  to  be  rendered. — The 
licensee  shall  remit  promptly  following  the  sale  of  cheese  received  on  consign- 
ment for  sale  or  distribution,  and  shall  render  to  the  consignor  an  account 
showing  the  true  sales  and  with  charges  only  for  services  actually  performed 
and  expenses  actually  incurred  by  the  licensee.  (Issued  Nov.  1,  1917,  as  to 
"food  commodities";  repealed  Jan.  6,  1919.) 

Rule  3.  Agent  not  to  buy  from  principal  unless  noted  on  account  of  sales. — The 
licensee  shall  not,  directly  or  indirectly,  sell  consigned  cheese,  or  cheese  with 
the  sale  of  which  on  commission  he  is  intrusted,  to  himself  or  to  any  one 
connected  with  his  business  unless  he  notes  the  facts  of  such  transaction  on 
the  account  of  sales.  (Issued  Nov.  1  1917,  as  to  "  food  commodities  " ;  repealed 
Jan.  6,  1919.) 

From  November  1,  1917,  to  April  16,  1918.  the  rule  governing  all  commission  mer- 
chants, brokers,  and  auctioneers  which  limited  their  charges  to  "  that  which 
ordinarily  and  customarily  prevails  under  normal  conditions  in  the  locality  in  which 
*  *  *  their  business  is  conducted  *  *  *  "  applied  to  these  dealers  in  perishables. 

C.  ADDITIONAL  SPECIAL  REGULATIONS  GOVERNING  RETAILERS  IN 

CHEESE. 

The  attention  of  all  retail  dealers  in  cheese  is  called  to  A,  Rule  1  of  the  above 
regulations,  headed: 

CHEESE  TO  BE  SOLD  AT  REASONABLE  ADVANCE  OVER  COST. 

Under  the  above  rule  the  retail  section  of  the  distribution  of  perishables  of  the 
United  States  Food  Administration  will  consider  the  sale  of  American  or 
Cheddar  cheese  at  an  advance  in  excess  of  7  or  8  cents  per  pound  over  cost  (as 


634 


HISTORY   OF  PRICES   DURING  THE  WAR. 


defined  in  rule  1)  as  unreasonable  and  as  evidence  of  violation  of  rule  1.  The 
7  cents  per  pound  represents  the  maximum  margin  for  stores  conducted  on  the 
cash  and  carry  or  no  service  plan,  while  8  cents  per  pound  is  the  maximum  for 
the  extra  service  stores  extending  credit  and  delivery.  Dealers  whose  delivered 
store-door  cost  figures  in  fractions  may  have  the  benefit  of  such  fractional  cost. 

CASH  AND  CARRY  STORES. 


Amount  of  sale. 

Cost. 

Margin. 

Total. 

Fraction 
added. 

Maximum 

selling 
price. 

Cents. 
26£ 

Cents. 
7 

Cents. 

Cents. 

Cents. 
34 

2  pounds                                           

524 

14 

66i 

67 

3  pounds 

96f 

21 

117J 

118 

In  determining  margins  at  7  and  8  cents  per  pound  on  cheese  with  the  fractional  cost  in 
the  dealer's  favor,  the  United  States  Food  Administration  has  given  duo  consideration  to 
the  rising  costs  of  operation,  which  must  be  met  by  the  dealer. 

In  addition  to  the  above  margin  a  retailer  who  carries  American  or  Cheddar  cheese  in 
a  warehouse  for  more  than  30  days  may  add  not  to  exceed  one-fourth  cent  per  pound  per 
month  for  each  and  every  month  after  the  30-day  period  during  which  the  cheese  is  held 
in  the  warehouse  by  him,  but  in  no  case  shall  the  amount  added  exceed  2  cents  per  pound, 
and  no  further  amount  shall  be  added  by  the  dealer  after  nine  months  from  the  date  of 
original  storage. 

Dealers  should  understand  that  if  they  average  costs  they  must  average  the  cost  of  each 
grade  and  style  separately. 

XXIV.  REGULATIONS  GOVERNING  COLD-STORAGE  WAREHOUSE- 
MEN. 

Rule  3.  Schedules  of  rates  to  be  filed. — Licensees  shall  submit  on  blanks  to  be 
furnished  for  that  purpose  a  statement  or  schedule  showing  present  rates  and 
charges  for  storage  and  other  service  on  each  commodity  required  to  be 
licensed,  together  with  all  charges  for  labor,  insurance  on  contents  of  ware- 
houses, and  whether  included  in  storage  rate,  cartage,  if  any,  and  whether  in- 
cluded in  storage  rate,  interest,  and  all  other  charges  not  enumerated.  (Such 
schedule  shall  be  open  to  inspection  at  the  office  of  the  Food  Administration 
in  Washington,  D.  C.,  and  information  as  to  any  particular  rate  included  in 
any  such  schedule  may  be  given  by  mail  or  telegraph  by  the  representatives  of 
the  Food  Administration  having  control  of  such  schedules  to  persons  who,  in 
their  opinion,  have  proper  reasons  for  requesting  such  information.  A  copy  of 
such  statement  or  schedule  shall  be  open  to  inspection  at  the  office  of  the  ware- 
houseman by  whom  it  is  filed.)  (Issued  Nov.  1,  1917;  added  to  Aug.  26,  1918; 
repealed  Feb.  14,  1919.) 

NOTE. — Attention  is  called  to  general  rule  5,  which  prohibits  licensees  from  making 
unjust,  exorbitant,  unreasonable,  discriminatory,  or  unfair  storage  charges. 

The  fact  that  a  licensee  files  with  the  Food  Administration  his  schedule  of  rates  and 
charges  under  special  rule  3  does  not  mean  that  the  rates  and  charges  in  such  schedule 
have  the  approval  of  the  Food  Administration.  If  the  Food  Administration  at  any  time 
has  reason  to  believe  that  any  such  rates  or  charges  are  unjust,  unfair,  exorbitant,  unrea- 
sonable, or  discriminatory,  the  licensee  will  be  called  upon  to  justify  such  rates  or 
charges. 

Rule  4.  No  rates  to  be  charged  other  than  those  in  schedules  filed.-  -The  licensee 
shall  not  demand,  collect,  or  receive,  directly  or  indirectly,  from  any  patron  or 
other  person  concerned  any  different  sum  for  storage  or  other  services  per- 
formed than  that  shown  on  the  schedule  filed  with  the  United  States  Food  Ad- 
ministration, or  make  any  charge  for  services  or  special  allowance  or  rebate  not 
shown  on  said  schedule,  unless  he  has  filed  with  the  United  States  Food  Ad- 
ministration at  least  30  days  before  the  change  in  rate  or  charge  becomes  effec- 
tive an  amendment  to  the  schedule  showing  such  change  in  rate  or  charge. 
(Issued  Nov.  1,  1917,  providing  for  amendment  to  storage  rates  to  be  filed  5 
days  before  change  is  effective ;  changed  to  30  days  Jan.  28,  1918 ;  repealed  Feb. 
14,  1919.) 

NOTES. — (1)  By  this  rule  a  licensee  is  prohibited  from  storing  licensed  food  com- 
modities at  rates 'fixed  by  contract  or  other  arrangement  that  differ  from  those  specified 
in  the  filed  schedule ;  when  amendments  to  any  schedule  are  filed  the  new  rates  become 
effective  30  days  after  filing  and  at  such  time  storing  at  the  rates  superseded  by  the 
amendments  must  cease,  any  arrangement  or  agreement  to  the  contrary  notwithstanding. 


GOVERNMENT   REGULATIONS   RELATING  TO  PRICES.  •  635 

/ 

(2)  General  rule  ~>  prohibits  cold  storage  licensees  from  making  unreasonable  or  dis- 
criminatory charges  in  handling  or  storing  food  commodities. 

The  United  States  Food  Administration  recognizes  the  principle  that  up  to  a  certain 
point  it  ordinarily  costs  less  per  unit  to  handle  large  lots  than  small  lots  of  a  par- 
ticular commodity  and  has  no  objection  to  licensees  charging  a  lesser  rate  per  unit  for 
large  lots  than  for  small  lots  if  the  differentiation  in  rates  is  based  on  variation  of  cost  in 
handling  the  particular  commodity. 

Hereafter  the  above-mentioned  principle  must  be  applied  by  cold-storage  warehousemen 
in  arranging  any  variations  in  rates  contained  in  schedules  of  rates  or  amendments 
thereto  that  are  filed. 

With  respect  to  rate  schedules  now  on  file  in  which  lower  rates  for  large  lots  or  dis- 
counts for  quantity  are  stated,  no  objection  has  been  or  will  be  made  to  differentiations 
in  rates  unless  they  are  obviously  merely  arbitrary  or  discriminatory,  or  in  effect  con- 
stitute a  preference  to  one  or  a  few  patrons,  or  unless,  upon  investigation,  they  are  found 
to  be  without  reasonable  justification. 

All  rates  must,  of  course,  be  contained  in  the  schedule  required  to  be  filed  with  the 
United  States  Food  Administration  and  must  be  clear,  explicit,  well  defined,  and  intel- 
ligible. Every  patron  is  entitled  to  Isnow  his  exact  classification  and  the  specific  rate  he 
is  to  be  charged. 

Hule  5.  Public  cold-storage  warehousemen  not  to  lend  more  than  70  per  cent  of 
the  value  of  stored  goods. — The  licensee  shall  not  make  any  loan  on  licensed 
commodities  stored  with  him,  or  Incur  liability  by  indorsement,  guarantee,  or 
otherwise,  in  connection  with  any  loan  on  licensed  commodities  stored  with  him, 
in  excess  of  70  per  cent  of  the  market  value  of  such  commodities  on  the  date 
of  said  loan.  A  margin  of  not  less  than  30  per  cent  on  each  loan  shall  be 
maintained  at  all  times. 

(Any  advances  made  by  the  licensee  on  the  goods  upon  which  the  loan  is 
made,  such  as  freight,  cartage,  or  insurance,  shall  be  included  in  the  70  per 
cent  of  the  market  value  permitted  above.) 

Loans  upon  licensed  and  unlicensed  commodities  shall  in  all  cases  be  made 
separately.  (Issued  Nov.  1,  1917;  added  to  Aug.  26,  1918;  repealed  Feb.  14, 
1919.) 

NOTES. — (1)  An  advanced  charge  arises  through  the  payment  of  money  by  the  ware- 
houseman to  some  third  person,  or  the  assumption  of  an  indebtedness  by  the  •ware- 
houseman, with  reference  to  the  goods  upon  which  the  loan  is  based.  For  example,  a 
charge  for  insurance,  freight,  or  cartage,  or  prior  storage,  which  the  warehoxiseman 
has  paid  or  assumed  to  pay,  is  an  advanced  charge,  and  must  be  included  in  estimating 
the  amount  of  the  loan  permitted  by  this  rule. 

On  the  other  hand,  the  indebtedness  to  the  warehouseman  making  the  loan  for  storage 
charges  on  the  goods  or  interest  on  the  loan,  or  any  other  item  which  does  not  repre- 
sent an  advance  by  the  warehouseman  to  or  for  the  customer  with  reference  to  the 
goods  stored,  is  not  an  advanced  charge  and  need  not  be  included  in  estimating  the 
amount  of  the  loan  permitted  by  this  rule. 

(2)  A   cold-storage*  warehouseman    in   releasing   or   delivering   out   any   licensed    com- 
modities on  which  such  loans  as  are  mentioned  in  this  rule  have  been  made,  shall,  if  such 
release  or  deliA'ery  would   result  in  the  margin  on  the  loan  being  reduced  to  less  than 
30  per  cent,  require  and  obtain  before  or  at  the  time  such  release  or  delivery  is  made 
a  sufficient  payment  so  that  the  amount  of  the  loan  is  reduced  and  the  required  margin 
of  at  least  30 'per  cent  is  at  all  times  preserved. 

(3)  A   combined    public   and   private    cold-storage   warehouseman   who    sells    on   credit 
food    commodities   required    to   be   licensed    and   transfers    title   thereto    and    who   there- 
after   stores    such    commodities    which    remain    security    for   the    unpaid    portion    of   the 
purchase  price,   is  by  extending  credit  in  such  a   transaction  indirectly   making  a   loan 
on  such  commodities  within  the  meaning  of  this  rule,  and  he  must  not  so  extend  credit 
for  more  than  70  per  cent  of  the  market  value  of  such  commodities. 

XXV.  FEEDING  STUFFS. 

Rule  7  (as  amended,  effective  Oct.  1, 1918).  Feed  to  be  sold  at  reasonable  ad- 
vance over  average  cost. — The  licensee  in  any  sale  of  feeding  stuffs  shall  take  no 
more  than  a  reasonable  profit  for  such  sale  over  the  average  cost  of  his  stock 
of  any  commodity  on  hand  or  under  control  not  at  that  time  contracted  to  be 
sold,  and  in  arriving  at  the  cost  of  grain  he  shall  take  into  consideration  the 
gain  or  loss  resulting  from  any  hedging  transaction  on  a  grain  exchange.  (This 
rule  shall  not  apply  to  feeding  stuffs  (other  than  grain,  hay,  or  seed)  pur- 
chased by  one  wholesale  feed  dealer  from  another  wholesale  feed  dealer,  and 
no  such  feeding  stuffs  so  purchased  shall  be  included  in  calculating  the  average 
cost  above  referred  to.)  (Issued  Jan.  28,  1918;  added  to  Oct.  1,  1918;  repealed 
Jan.  10,  1919.) 

NOTE. — This  rule  does  not  apply  to  wheat  mill  feeds,  cottonseed  products,  rice  polish, 
rice  bran,  or  dried  beet  pulp,  which  are  dealt  with  under  Special  Regulations  C  and  D. 

Marcjins  and  profits  for  icliolesalc  dealers  in  feeding  stuffs. — The  United  States  Food 
Administration  considers  that  In  sales  of  feeding  stuffs  at  wholesale  the  advance  on 
any  individual  sale  should  not  in  any  case  exceed  the  purchase  price  delivered  at  rail- 
road station,  plus  15  per  cent.  The  Food  Administration  will  therefore  consider  any 
sale  of  feeding  stuffs  in  excess  of  this  advance  as  a  violation  of  the  foregoing  rule. 
This  margin  will  also  apply  to  the  sale  of  corn,  oats,  rye,  or  barley  as  feed,  in  assorted 
cars  with  .other  feeding  stuffs  but  not  in  straight  carload  quantities,  but  will  not  apply 
to  wheat  mill  feeds,  cottonseed  products,  rice  polish,  rice  bran,  or  dried  beet  pulp,  for 


636  HISTORY   OF   PRICES   DURING  THE   WAR. 

which  special  margins  have  been  prescribed.  For  margins  applying  on  straight  carload 
shipments  of  grain,  see  the  grain  dealers'  rules  No.  III-A. 

Furthermore,  the  Food  Administration  will  consider  an  annual  net  earning  by  any 
wholesale  dealer  in  feeding  stuffs  of  more  than  4  per  cent  upon  the  total  gross  sales,  if 
his  gross  sales  of  feeding  stuffs  amount  to  $100,000  or  more  per  annum  to  be  prima  facie 
evidence  of  a  violation  of  the  rule  which  prohibits  the  taking  of  unreasonable  profits.  In 
the  case  of  dealers  who  handle  wheat  mill  feeds,  cottonseed  products,  rice  polish,  rice 
bran,  and  dried  beet  pulp,  as  well  as  other  feeds,  the  4  per  cent  will  be  calculated  on  all 
sales. 

The  maximum  margin  on  individual  sales  is  purposely  made  wide  because  of  the 
speculative  character  of  the  products  dealt  with  and  the  fluctuating  prices  which  may 
prevail.  As  pointed  out,  the  general  average  on  all  sales  must  not  exceed  4  per  cent 
advance  over  the  cost  of  materials  and  overhead,  nor  must  this  4  per  cent  limitation 
modify  or  abrogate  the  general  principle  contained  in  the  Food  Administration  regula- 
tions that  a  licensee  shall  not  earn  more  than  a  reasonable  net  profit  on  his  capital 
invested. 

Rule  8  (effective  Oct.  1,  1918).  Margins  for  wholesale  dealer,  on  feeding  stuffs 
bought  from  another  wholesale  dealer. — No  wholesale  dealer  in  feeding  stuffs 
shall  sell  any  feeding  stuffs  which  he  has  purchased  from  another  wholesale 
dealer,  other  than  grain,  hay,  or  seed,  at  an  advance  over  the  average  cost  to 
the  dealer  who  bought  direct  from  the  manufacturer,  greater  than  would  be 
reasonable  for  the  first  dealer  to  charge  if  selling  direct  to  a  retailer.  No 
wholesale  dealer  shall  purchase  feeding  stuffs  from  another  dealer  without 
obtaining  from  him  a  written  statement  giving  the  average  delivered  purchase 
price  paid  by  the  dealer  who  purchased  direct  from  the  manufacturer  for  his 
stock  of  such  commodity  and  the  margin  which  he  has  added.  (Repealed 
Jan.  10,  1919.) 

NOTE. — The  Food  Administration  has  considered  the  advisability  of  prohibiting  all 
resales  of  feeding  stuffs  between  wholesale  feed  dealers,  but  has  decided,  under  the  above 
rule,  to  permit  such  resales  if  the  total  margin  charged  by  the  wholesale  dealers  does  not 
exceed  the  margin  which  would  be  considered  reasonable  if  the  product  passed  through 
the  hands  of  one  dealer  only. 

Rule  9  (as  amended  Dec.  31,  1918).  No  resales  unless  cost  and  margin  are  stated 
on  sales  memorandum  and  invoice. — No  wholesaler  or  jobber  shall  sell  feed 
unless  he  states  upon  his  contract  or  sales  memorandum  and  upon  the  invoice 
the  average  delivered  purchase  price  of  his  stock  of  such  commodity  on  hand  or 
under  control  at  the  time  they  are  contracted  to  be  sold,  or  in  cases  wheYe  he 
purchased  feeding  stuffs  other  than  grain  or  seed  from  another  wholesale  feed 
dealer  the  average  delivered  purchase  price  paid  by  the  dealer  who  bought 
direct  from  the  manufacturer,  provided,  however,  that  this  rule  shall  not  apply 
to  sales  of  wheat  mill  feeds.  (Issued  Oct.  1,  1918;  added  to  Dec.  31,  1918; 
repealed  Jan.  10,  1919.) 

NOTE. — Under  the  above  rule  the  following  notation  should  be  made  on  the  contract  or 
sales  memorandum  and  upon  the  invoice  by  every  jobber  of  feed  : 

"  This  invoice  is  sold  on  the  basis  of  an  average  purchase  price  of  $ per  ton. 

I  have  added  a  gross  margin  of  $ per  ton." 

If  the  feed,  other  than  grain  or  seed,  has  been  purchased  from  another  feed  dealer,  the 
following  notation  should  be  made  : 

"  This  invoice  is  sold  on  the  basis  of  an  average  purchase  price  (when  bought  from 
manufacturer)  of  $ per  ton. 

"  The  first  dealer  added  a  gross  margin  of  $ per  ton  and  freight  of  $ per 

ton.  I  have  added  a  gross  margin  of  $ per  ton." 

C.  SPECIAL    REGULATIONS   APPLYING    TO    WHEAT    MILL    FEEDS. 

NOTE. — Wheat  mill-feed  prices. — All  wheat  millers  should  sell  wheat  mill  feed  on  a 
fair-price  schedule  which  is  based  on  the  Government  wheat  price  and  which  is  furnished 
to  each  mill.  The  rules  require  that  upon  request  the  mill  furnish  to  any  person  a  copy 
of  its  fair-price  schedule  as  prescribed  by  the  United  States  Food  Administration.  The 
purchaser  is  abetting  a  violation  of  the  milling  rules  if  he  pays  more  for  feed  than  is 
permitted  thereby. 

Rule  2  (as  amended,  effective  Oct.  1,  1918).  One  commission  not  to  exceed  50 
cents  a  ton  permitted  on  consigned  feed. — No  licensee  selling  the  above  feeds  as  a 
commission  agent  for  the  sale  of  consigned  wheat  mill  feeds  making  sale, 
delivery,  and  collection  shall  charge  more  than  a  reasonable  commission,  not 
to  exceed  50  cents  per  ton ;  and  no  licensee  shall  charge  a  commission  on  any 
of  the  above  feeds  on  which  a  commission  has  already  been  charged.  (Rule 
issued  Feb.  13,  1918,  provided  brokerage  not  to  exceed  25  cents  per  ton  on 
wheat  mill  feed  and  prohibited  double  brokerage ;  changed  Oct.  1,  1918,  as 
noted  here,  by  addition  of  commodities ;  repealed  Dec.  31,  1918. ) 

NOTE. — Commission  or  brokerage  must  be  paid  out  of  the  margin  or  price  allowed 
by  the  regulations  to  the  person  paying  the  commission  or  brokerage  and  must  not  be 
added  to  price  charged. 


GOVERNMENT   REGULATIONS    RELATING   TO   PRICES.  637 

Rule  3  (as  amended,  effective  Oct.  1,  1918).  Reasonable  margins  fixed  for  deal- 
ers.— No  licensee  buying  and  selling  the  above  feeds  as  a  wholesaler  or  jobber 
shall  charge  more  than  a  reasonable  advance  over  the  bulk  price  at  mill  of 
the  particular  feed  sold  (plus  freight  and  cost  of  sacks),  such  advance  not  to 
exceed  the  following: 

Shipment  from  mill  or  in  transit,  payment  cash,  demand  draft,  or  sight 
draft,  $1  per  ton. 

Shipment  from  mill  or  in  transit,  sale  on  arrival,  draft  terms,  $1.50  per  ton. 

Sale  ex-jobbers'  warehouse,  payment  cash,  sight  draft  or  demand  draft, 
$2.50  per  ton. 

Sale  ex-jobbers'  warehouse  upon  arrival  draft  terms,  $3  per  ton. 

In  making  sales  on  credit  not  to  exceed  $1  per  ton  may  be  added  to  the 
margin  which  could  be  charged  if  sold  on  arrival  draft  terms.  (Rule  issued 
Feb.  13,  1918,  applied  only  to  wheat  mill  feeds;  changed  Oct.  1,  1918,  as  noted 
here,  by  addition  of  commodities ;  repealed  Jan.  10,  1919. ) 

C    (a).    SPECIAL   REGULATIONS    APPLYING    TO    RICE    POLISH,    RICE 
BRAN,  AND  DRIED  BEET  PULP. 

NOTE. — Rice  feed  prices. — Under  a  uniform  agreement  with,  the  United  States  Food 
Administrator,  all  rice  millers  have  agreed  to  sell  rice  polish  at  not  to  exceed  $50  per 
ton,  packed  in  customary  manner,  car  lots,  f.  o.  b.  mills,  and  rice  bran  at  not  to  exceed 
$36  per  ton,  packed  in  customary  manner,  car  lots,  f.  o.  b.  mills. 

Beet  pulp  prices. — The  United  States  Food  Administration  has  fixed  the  following 
prices  for  beet  pulp  as  returning  a  fair  margin  of  profit  to  the  beet-sugar  manufacturers : 

Ter  ton. 

Wet  boot  pulp,  bulk,  mill $0.  80 

Wet  beet  pulp  out  of  silo,  bulk,  mill _ 1.  25 

Dried  beet  pulp,  sacked,  f.  o.  b.  factory,  in  car  lots 40.  00 

Rule  1  (as  amended  Dec.  31,  1918).  One  brokerage  not  to  exceed  25  cents  a  ton 
permitted. — No  licensee  selling  the  above  feeds  as  a  broker  shall  charge  more 
than  a  reasonable  brokerage,  not  to  exceed  25  cents  per  ton.  (Rule  issued  Feb. 
13,  1918,  provided  brokerage  not  to  exceed  25  cents  per  ton  on  wheat,  mill  feed, 
and  prohibited  double  brokerage;  changed  Oct.  1,  1918,  to  include  rice  polish, 
rice  bran,  and  dried  beet  pulp;  changed  Dec.  31,  1918,  as  noted  here — wheat, 
mill  feed  not  included ;  repealed  Jan.  10,  1919. ) 

Rule  2  (repealed  Dec.  31,  1918).  One  commission  not  to  exceed  50  cents  a  ton 
permitted  on  consigned  feed. 

Rule  3  (as  amended,  effective  Oct.  1,  1918).  Reasonable  margins  fixed  for  deal- 
ers.— No  licensee  buying  and  selling  the  above  feeds  as  a  wholesaler  or  jobber 
shall  charge  more  than  a  reasonable  advance  over  the  bulk  price  at  mill  of  the 
particular  feed  sold  (plus  freight  and  cost  of  sacks),  such  advance  not  to  ex- 
ceed the  following: 

Shipment  from  mill  or  in  transit,  payment  cash,  demand  draft  or  sight 
draft,  $1  per  ton. 

Shipment  from  mill  or  in  transit,  sale  on  arrival  draft  terms,  $1.50  per  ton. 

Sale  ex-jobbers'  warehouse,  payment  cash,  sight  draft  or  demand  draft,  $2.50 
per  ton. 

Sale  ex-jobbers'  warehouse,  upon  arrival  draft  terms,  $3  per  ton. 

In  making  sales  on  credit  not  to  exceed  $1  per  ton  may  be  added  to  the 
margin,  which  could  be  charged  if  sold  on  arrival  draft  terms. 

Rule  4.  No  resales  of  wheat  mill  feeds  if  total  margin  exceeds  that  prescribed 
in  rule  3. — No  wholesaler  or  jobber  shall  sell  wheat  mill  feed  to  any  person  other 
than  a  retail  dealer,  manufacturer,  or  a  consumer ;  provided,  that  he  may  sell 
to  another  wholesaler  or  jobber  if  in  making  such  sales  he  states  to  the  buyer 
the  price  which  was  paid  bulk  mill  for  the  particular  wheat  mill  feeds  sold  in 
such  case.  The  buyer  shall  not  sell  such  mill  feed  at  more  than  the  advances 
specified  in  rule  3  over  the  bulk  mill  price  of  the  particular  wheat  mill  feed 
bo  purchased  from  another  wholesaler  or  jobber.  (Issued  Feb.  13,  1918;  see 
rule  4  following;  repealed  Oct.  1,  1918.) 

Rule  4  (repealed  Oct.  1,  1918).  No  resales  of  wheat  mill  feeds  if  total  margin 
exceeds  that  prescribed  in  rule  3. — Dealers  in  wheat  mill  feeds  as  well  as  other 
feeds  are  now  governed  as  to  resales  by  rules  B — 7,  8,  9,  which  see  above. 

D.  SPECIAL  REGULATIONS  APPLYING  TO  DEALERS  AND  BUYERS  IN 
COTTONSEED  CAKE,  COTTONSEED  MEAL,  COTTONSEED 

HULLS,  PEANUT  MEAL,  AND  SOYA-BEAN  MEAL. 

Rule  1.  To  be  sold  at  reasonable  advance  over  cost  of  particular  lot  sold. — The 
licensee  shall  sell  the  above  commodities  at  not  more  than  a  reasonable  ad- 
vance over  the  actual  cost  of  the  particular  commodity  sold,  without  regard  to 
the  market  or  replacement  value  at  the  time  of  sale.  (Issued  Aug.  1,  1918; 


638  HISTORY   OP   PRICES   DURING   THE   WAR, 

repealed  as  to  all  except  cottonseed  products  Jan.  10,  1919;  repealed  as  to  cot- 
tonseed products  May  31,  1919.) 

NOTE. — Until  further  notice  tlic  United  States  Food  Administration  will  regard  any 
resale  of  cottonseed  meal  or  cake  by  jobbers  or  wholesalers  at  margins  in  excess  of  the 
following  as  unreasonable  and  in  violation  of  the  foregoing  rule  : 

Shipment  from  mill  or  in  transit,  payment  cash,  demand  draft  or  sight  draft,  $1  per 
ton. 

Shipment  from  mill  or  in  transit,  Palo  on  arrival  draft  terms,  $1.50  per  ton 

Sale  ex-jobbers'  warehouse,  payment  cash,  sight  draft,  or  demand  draft  where  meal 
or  cake  is  actually  handled  through  the  warehouse,  $2.50  per  ton. 

Sale  ex- jobbers'  warehouse  upon  arrival  draft  terms  where  meal  or  cake  is  actually 
handled  through  the  warehouses,  $3  per  ton. 

In  making-  sales  on  credit  except  to  other  wholesalers  not  to  exceed  $1  per  ton  may  be 
added  to  the  margin  which  could  be  charged  if  sold  on  arrival  draft  terms. 

Rule  2.  New  crop  cottonseed  products  not  to  be  bought  or  sold  before  Au- 
gust 1. — The  licensee  shall  not  buy  or  sell  cottonseed  meal,  cottonseed  cake,  or 
cottonseed  hulls,  made  or  to  be  made  from  new-crop  cotton  seed,  grown  in  the 
United  States  before  August  1  of  the  year  in  which  such  cotton  seed  is  grown. 
(Issued  Aug.  1,  1918;  repealed  Dec.  17,  1918.) 

NOTE. — Under  special  rule  B-3  these  products  can  only  be  bought  or  sold  after  August 
1,  for  60  days'  delivery. 

Eule  3.  Quotations  based  on  protein  or  fat  content. — Licensees  who  base  quota- 
tions of  cottonseed  meal  or  cake  upon  either  the  protein  or  fat  content,  or 
combination  thereof,  shall  not  use  any  range  of  percentages,  but  shall  state  that 
the  product  offered  contains  not  less  than  a  definite  percentage.  (Issued  Apr. 
4,  1918;  repealed  Dec.  17,  1918.) 

Note  to  rule  1. — Resales  are  forbidden  by  rule  B-8  unless  they  divide  the  above  margin. 

Under  the  stabilization  program  of  the  United  States  Food  Administration  based  on 
the  price  of  cotton  seed  at  the  average  agreed  upon  by  the  producers  and  the  Food  Admin- 
istration, the  following  prices  have  been  arranged  for  cottonseed  meal,  cake,  and  hulls  : 

Cottonseed  meal  and  screened  cracked  cake  43  per  cent  protein  in  any  quantity — $57 
per  ton  in  sacks,  f.  o.  b.  all  points  of  manufacture  in  Texas. 

Cottonseed  meal  and  screened  cracked  cake  40  per  cent  protein  in  any  quantity— $54 
per  ton  in  sacks,  f.  o.  b.  all  points  of  manufacture  in  Oklahoma. 

Cottonseed  meal  and  screened  cracked  cake  36  per  cent  protein  in  any  quantity — $51 
per  ton  in  sacks,  f.  o.  b.  all  points  of  manufacture  in  Imperial  County,  Calif.,  and  $55 
per  ton  in  sacks,  f.  o.  b.  all  points  of  manufacture  in  Los  Angeles  County,  Calif. 

Cottonseed  meal  and  screened  cracked  cake  36  per  cent  protein  in  any  quantity — $53 
per  ton  in  sacks,  f.  o.  b.  all  points  of  manufacture  in  Alabama,  Arkansas.  Florida,  Georgia, 
Louisiana,  Mississippi,  Missouri,  North  Carolina,  South  Carolina,  and  Tennessee. 

Bulk,  loose,  or  slab  cottonseed  cake  shall  be  not  less  than  $5  per  ton,  and  bulk  or  loos;1 
cottonseed  meal  and  screened  cracked  cake  shall  be  not  less  than  $4  per  ton  under  the 
prices  specified  above. 

All  cottonseed  meal,  screened  cracked  cake,  bulk  cake  showing  protein  content  other 
llian  above  specified  may  be  offered  and  sold  at  $1  for  each  unit  protein  over  or  under 
the  percentages  as  shown  above :  Provided,  Iwwever,  if  cottonseed  meal  or  cake  upon 
delivery  is  ascertained  to  be  of  lower  protein  content  than  justified  by  price  charged  any 
refund  must  be  made  at  the  rate  of  $1.40  per  unit  protein.  Each  shipment  or  delivery 
shall  be  considered  separately  and  without  relation  to  the  whole  contract.  This  rule 
must  not  be  construed  in  any  way  as  an  exception  to  the  pure  food  act  of  1906  or  any  of 
the  amendments  thereto. 

Cottonseed  hulls,  bulk  or  loose,  $20  per  ton,  f.  o.  b.  cars  at  point  of  manufacture. 

Prices  specified  are  net  to  manufacturer.  Terms  of  sale  are  upon  the  basis  of  cash  or 
its  equivalent. 

All  manufacturers  are  urged  to  give  preference  in  the  sales  of  their  products  to 
producers  and  consumers. 

Under  the  Food  Administration  regulations  manufacturers  of  cottonseed  meal,  cake, 
and  hulls  are  not  permitted,  to  the  exclusion  of  consumers,  to  make  sales  of  their 
products  to  firms,  factories,  or  corporations  in  which  the  corporation  or  the  officers  of  the 
producing  mill  may  be  interested,  without  the  written  consent  of  the  Food  Administration. 

G.  SPECIAL  REGULATIONS  APPLYING  TO  MANUFACTURERS  OF  COM- 
MERCIAL MIXED  FEEDS. 
pEorrr  LIMITATION. 

Under  rule  B-7  prescribing  a  reasonable  profit  on  the  sale  of  feeding  stuffs, 
the  following  announcement  has  been  issued  applying  to  the  manufacture  of 
commercial  mixed  feeds : 

Margins  and  pro-fit  for  mixed-feed  manufacturers. — The  United  States  Food 
Administration  considers  that  in  the  manufacture  and  sale  of  ground  or  crushed 
grains  or  ground  hay,  and  of  all  commercial  mixed  feeds,  the  advance  on  any 
individual  sale  should  not  exceed  the  cost  of  materials,  manufacturing,  and  over- 
head, plus  12*  per  cent.  The  Food  Administration  will  therefore  consider  un- 
reasonable and  as  a  violation  of  the  foregoing  rule  any  sale  of  such  feeds  in 
excess  of  this  advance. 

Furthermore,  the  Food  Administration  will  consider  an  annual  net  earning 
or  more  than  6  per  cent  upon  the  total  gross  sales  of  any  such  feeding  stuffs  if 
the  dealers'  gross  sales  amount  to  $100,000  or  more  per  annum  to  be  prima 
facie  evidence  of  a  violation  of  the  rule  which  prohibits  the  taking  of  unreason- 
able profits. 


GOVEKNMENT   REGULATIONS   RELATING   TO   PRICES.  639 

The  maximum  margin  on  individual  sales  is  purposely  made  wide  because  of 
the  speculative  character  of  the  products  which  enter  into  such  manufacture 
and  the  rapidly  fluctuating  prices  which  may  prevail.  As  pointed  out,  the  gen- 
eral average  on  all  sales  must  not  exceed  6  per  cent  advance  over  the  cost  of 
materials,  manufacture,  and  overhead,  nor  does  this  6-per  cent  limitation 
modify  or  abrogate  the  general  principle  contained  in  the  Pood  Administration 
regulations  that  a  licensee  shall  not  earn  more  than  a  reasonable  net  profit  on 
his  capital  invested.  The  manufacture  of  mixed  feeds  is  a  business  which  varies 
in  many  respects  according  to  the  type  of  feed,  the  expense  of  manufacture,  and 
the  rapidity  of  turnover.  There  are  therefore  some  manufacturers  to  whom  a  6 
per  cent  annual  net  profit  may  give  an  unreasonable  return  on  their  investment. 
In  such  case  they  are  obliged  to  sell  at  a  lower  average  return. 

One  margin  only. — Mixed  feed  manufacturers  are  not  allowed  directly  or 
indirectly  to  take  any  feed  dealer's  margin  on  their  mixed  feed.  On  feed 
which  they  buy  and  sell  without  mixing  or  processing  in  any  manner  they  may 
take  only  the  feed  dealers'  margins,  and  not  that  permitted  to  mixed  feed 
manufacturers.  Feed  manufacturers  may  not  establish  any  jobbing  department 
for  feeds  of  their  own  manufacture  in  order  to  obtain  additional  profits. 

Blackstrap  molasses. — The  attention  of  feed  manufacturers  is  called  to  the 
fact  that  refiners  and  manufacturers  of  sugar  in  the  United  States  have  been 
forbidden  to  sell  blackstrap  molasses  in  bulk  at  more  than  18  cents  per  gallon, 
or  in  barrels,  at  more  than  23  cents  per  gallon.  The  prices  named  are  f.  o.  b. 
cars  at  primary  markets  or  port  of  entry,  or  factory,  net  cash  in  10  days  with- 
out discount,  and  shall  include  brokerage  and  any  profit  taken  by  distributors 
in  tank  cars  direct  from  the  refiners,  but  shall  not  include  freight  or  tank-car 
charges. 

Feed  manufacturers  should  be  able  to  buy  blackstrap  molasses  at  the  above- 
prices  in  tank  cars,  paying  in  addition  thereto  only  the  freight  and  tank-car 
charges.  An  additional  margin  of  10  per  cent  is  permitted  to  dealers  in  barrels 
who  handle  such  barrels  through  their  warehouse.  The  same  rules  apply  to 
imported  blackstrap  molasses. 

J.  SPECIAL  REGULATIONS  APPLYING  TO  RETAILERS  OF  FEED. 

Rule  1  (as  amended  Dec.  31,  1918).  Margin  over  cost  of  particular  feed  pre- 
scribed on  feeds  whose  price  is  stabilized. — No  retailer  of  rice  polish,  rice  bran, 
dried  beet  pulp,  or  cottonseed  products  shall  charge  more  than  a  reasonable 
advance  over  the  delivered  price  of  the  particular  feeds  sold.  (Rule  issued 
Oct.  1,  1918,  included  wheat  mill  feeds.  Changed  Dec.  31,  1918,  as  noted  here, 
wheat  mill  feed  not  included.  Repealed  Jan.  10,  1919,  as  to  all  except  cotton- 
seed products.  Repealed  May  31,  1919,  as  to  cottonseed  products.)  . 

NOTE. — Under  the  above  rule  the  Food  Administration  will  consider  any  margins  iu 
excess  of  those  indicated  in  the  following  schedule  as  unreasonable  in  case  of  rice  feed, 
and  dried  beet  pulp.  These  schedules  are  maximum,  and  do  not  justify  charges  in  excess 
of  those  customarily  charged  in  any  particular  district  or  case  where  the  lower  charge;; 
will  insure  a  reasonable  profit. 

1.  Where  oue  or  more  farmers  purchase  in  advance  of  delivery,  in  full  carloads,  take 
delivery  at  car  and  pay  cash  when  retail  dealer  is  required  to  meet  sight  draft,  $1  per 
ton,  plus  demurrage,  if  any. 

2.  Where  one  or  more  farmers  purchase  in  advance  of  delivery,  in  full  carloads,  take 
delivery  at  car  and  pay  for  it  on  delivery,  $1.50  per  ton,  plus  demurrage,  if  any. 

3.  Where  a  farmer  purchases  and  takes  delivery  at  car  and  pays  for  it  on  delivery  in 
ton  lots  or  more  but  less  than  car  lots,  $2  per  ton. 

4.  Where  farmer  purchases  and  takes  delivery  at  car  and  pays  for  it  on  delivery  in 
lots  less  than  one  ton,  $2.50  per  ton. 

5.  Sale  ex-warehouse  in  lots  of  one  ton  or  more,  $4  per  ton. 
G.  Sale  ex-warehouse  in  lots  of  less  than  one  ton,  $5  per  ton. 

7.  One  dollar   may  be  added  to   the  foregoing  margins  when  sale  is  made  on  credit, 
or  at  dealer's  option  the  legal  rate  of  interest  may  be  charged. 

8.  One  dollar   shall  be  deducted   from   the  margins  prescribed   in   5   and   6   when   the 
retailer  buys  on  credit  and  the  jobber's  margin  is  thereby  increased  $1  a  ton. 

Cottonseed  products. — The  above  margins  will  also  apply  to  the  sale  of  cottonseed 
meal,  cake,  and  hulls  by  retail  feed  dealers,  except  where  different  margins  have  been 
prescribed  by  the  Federal  food  administrator  of  the  State  where  the  dealer  is  located. 

Margins  and  profits  for  retail  dealers  in  feeding  stuffs. — The  United  States  Food  Ad- 
ministration considers  that  in  sales  of  feeding  stuffs  at  retail  the  advance  on  any  indi- 
vidual sale  should  not  in  any  case  exceed  the  purchase  price  delivered  at  warehouse  door, 
plus  15  per  cent.  Where  delivery  is  made  to  the  consumer,  reasonable  cartage  charges 
may  be  added.  The  Food  Administration  will  therefore  consider  any  sale  of  feeding 
stuffs  in  excess  of  this  advance  as  a  violation  of  rule  B-7.  This  margin  also  applies  to 
the  sale  of  corn,  oats,  rye,  or  barley  at  retail  as  feed,  but  not  to  wheat  mill  feeds,  cotton- 
scrd  products,  rice  products,  or  dried  beet  pulp.  Special  margins  for  cottonseed  products, 
rice  products,  and  beet  pulp  are  prescribed  above. 

Futhermore.  the  Food  Administration  will  consider  an  annual  net  earning  by  any  retail 
dealer  of  feeding  stuffs  of  more  than  6  per  cent  upon  the  total  gross  sales  if  his  gross 
sales  of  feeding  stuffs  amount  to  $100,000  or  more  per  annum  to  be  prima  facie  evidence 
of  a  violation  of  tbe  rule  which  prohibits  the  taking  of  unreasonable  profits.  This  6  per 
cent  will  be  calculated  on  tbe  sales  of  all  feeding  stuffs,  including  those  specially  listed 
above  and  also  wheat  mill  feeds. 


3.  FUELS. 


The  basis  for  all  of  the  formal  regulations  over  fuel  prices  during  the  war  lay 
in  section  25  (commonly  known  as  the  Pomerene  amendment)  of  the  food-and- 
fuel  control  act  which  was  made  lawr  on  August  10,  1917.1  An  informal  control 

1  There  follows  in  full  the  section  of  the  food-and-fuel  control  act  of  August  10,  1917, 
which  pertains  to  control  over  fuel  prices : 

SEC..  25.  That  the  President  of  the  United  States  shall  be,  and  he  is  hereby,  authorized 
and  empowered,  whenever  and  wherever  in  his  judgment  necessary  for  the  efficient  prose- 
cution of  the  war  to  fix  the  price  of  coal  and  coke  wherever  and  whenever  sold,  either 
by  producer  or  dealer,  to  establish  rules  for  the  regulation  of  and  to  regulate  the  method 
of  production,  sale,  shipment,  distribution,  apportionment,  or  storage  thereof  among  deal- 
ers and  consumers,  domestic  or  foreign  ;  said  authority  and  power  may  be  exercised  by  him 
in  each  case  through  the  agency  of  the  Federal  Trade  Commission  during  the  war  or 
for  such  part  of  said  time  as  in  his  judgment  may  be  necessary. 

That  if,  in  the  opinion  of  the  President,  any  such  producer  or  dealer  fails  or  neglects 
to  conform  to  such  prices  or  regulations,  or  to  conduct  his  business  efficiently  under  the 
regulations  and  control  of  the  President  as  aforesaid,  or  conducts  it  in  a  manner  preju- 
dicial to  the  public  interest,  then  the  President  is  hereby  authorized  and  empowered  in 
every  such  case  to  requisition  and  take  over  the  plant,  business,  and  all  appurtenances 
thereof  belonging  to  such  producer  or  dealer  as  a  going  concern  and  to  operate  or  cause 
the  same  to  be  operated  in  such  manner  and  through  such  agency  as  he  may  direct  during 
the  period  of  the  war  or  for  such  part  of  said  time  as  in  his  judgment  may  be  necessary. 

That  any  producer  or  dealer  whose  plant,  business,  and  appurtenances  shall  have  been 
requisitioned  or  taken  over  by  the  President  shall  be  paid  a  just  compensation  for  the 
use  thereof  during  the  period  that  the  same  may  be  requisitioned  or  taken  over  as  afore- 
said, which  compensation  the  President  shall  fix  or  cause  to  be  fixed  by  the  Federal 
Trade  Commission. 

That  if  the  prices  so  fixed,  or  if,  in  the  case  of  taking  over  or  requisitioning  of  the 
mines  or  business  of  any  such  producer  or  dealer  the  compensation  therefor  as  deter- 
mined by  the  provisions  of  this  act  be  not  satisfactory  to  the  person  or  persons  entitled 
to  receive  the  same,  such  person  shall  be  paid  seventy-five  per  centum  of  the  amount  so 
determined,  and  shall  be  entitled  to  sue  the  United  States  to  recover  such  further  sum  as 
added  to  said  seventy-five  per  centum,  will  make  up  such  amount  as  will  be  just  com- 
pensation in  the  manner  provided  by  section  twenty-four,  paragraph  twenty,  and  section 
one  hundred  and  forty-five  of  the  Judicial  Code. 

While  operating  or  causing  to  be  operated  any  such  plants  or  business  the  President  is 
authorized  to  prescribe  such  regulations  as  he  may  deem  essential  for  the  employment, 
control,  and  compensation  of  the  employees  necessary  to  conduct  the  same. 

Or  if  the  President  of  the  United  States  shall  be  of  the  opinion  that  he  can  thereby 
better  provide  for  the  common  defense,  and  whenever,  in  his  judgment,  it  shall  be  neces- 
sary for  the  efficient  prosecution  of  the  war,  then  he  is  hereby  authorized  and  empowered 
to  require  any  or  all  producers  of  coal  and  coke,  either  in  any  special  area  or  in  any 
special  coal  fields,  or  in  the  entire  United  States,  to  sell  their  products  only  to  the 
United  States  through  an  agency  to  be  designated  by  the  President,  such  agency  to  regu- 
late the  resale  of  such  coal  and  coke,  and  the  prices  thereof,  and  to  establish  rules  for 
the  regulation  of  and  to  regulate  the  methods  of  production,  shipment,  distribution,  ap- 
portionment, or  storage  thereof  among  dealers  and  consumers,  domestic  or  foreign,  and 
to  make  payment,  of  the  purchase  price  thereof  to  the  producers  thereof  or  to  the 
person  or  persons  legally  entitled  to  said  payment. 

That  within  fifteen  days  after  notice  from  the  agency  so  designated  to  any  producer 
of  coal  and  coke  that  his,  or  its,  output  is  to  be  so  purchased  by  the  United  States  as 
hereinbefore  described,  such  producer  shall  cease  shipments  of  said  product  on  his  own 
account  and  shall  transmit  to  such\  agency  all  orders  received  and  unfilled,  or  partially 
unfilled,  showing  the  exact  extent  to  which  shipments  have  been  made  thereon,  and  there- 
after all  shipments  shall  be  made  only  on  authority  of  the  agency  designated  by  the 
President,  and  thereafter  no  such  producer  shall  sell  any  of  said  products  except  to  the 
United  States  through  such  agency,  and  the  said  agency  alone  is  hereby  authorized  and 
empowered  to  purchase  during  the  continuance  of  the  requirement  the  output  of  such 
producers. 

That  the  prices  to  be  paid  for  such  products  so  purchased  shall  be  based  upon  a  fair 
and  just  profit  over  and  above  the  cost  of  production,  including  proper  maintenance  and 
depletion  charges,  the  reasonableness  of  such  profits  and  cost  of  production  to  be  deter- 
mined by  the  Federal  Trade  Commission  ;  and  if  the  prices  fixed  by  the  said  commission 

640 


GOVERNMENT  REGULATIONS   RELATING  TO   PRICES.  641 

was,  however,  previously  exercised  over  anthracite  prices  in  particular  by  the 
Federal  Trade  Commission  and  over  bituminious  prices  by  the  coal  production 
committee  of  the  Council  of  National  Defense.  The  President,  by  authority  from 
the  food  and  fuel  control  act,  issued  a  provisional  schedule  of  bituminous  coal 
prices  on  August  21,  1917,  another  of  anthracite  coal  prices  on  August  23,  and 
also  named  Mr.  Harry  A.  Garfield  as  United  States  Fuel  Administrator  on 
August  23,  1917.  The  whole  body  of  fuel-price  controls  thenceforth  were  ad- 
ministered through  the  United  States  Fuel  Administration  at  Washington. 

The  United  States  Fuel  Administration  was  concerned  with  distribution, 
production,  conservation,  and  price  regulation  over  domestic  coal,  but  this 
inquiry  pertains  only  to  the  price  controls  exercised  by  it.  The  price  regula- 
tions which  are  tabulated  here  cover  in  full  the  field  marked  out  by  the  legal 
division  of  the  Fuel  Administration,  as  compiled  officially  by  them  in  "  general 
orders,  regulations,  and  rulings  of  the  United  States  Fuel  Administration." 
They  have  been  brought  down  to  date  by  assistance  from  the  Fuel  Adminis- 
tration, since  the  above  official  compilation  covers  only  the  rulings  from 
August  23,  1917,  to  January  1,  1919. 

of  any  such  product  purchased  by  the  United  States  as  hereinbefore  described  be  unsatis- 
factory to  the  person  or  persons  entitled  to  the  same,  such  person  or  persons  shall  be 
paid  seventy-five  per  centum  of  the  amount  so  determined  and  shall  be  entitled  to  sue 
the  United  States  to  recover  such  further  sum  as  added  to  said  seventy-five  per  centum 
will  make  up  such  amount  as  will  be  just,  compensation  in  the  manner  provided  for  by 
section  twenty-four,  paragraph  twenty,  and  section  one  hundred  and  forty-five  of  the 
Judicial  Code. 

All  such  products  so  sold  to  the  United  States  shall  be  sold  by  the  United  States  at 
such  uniform  prices,  quality  considered,  as  may  be  practicable,  and  as  may  be  deter- 
mined by  said  agency  to  be  just  and  fair. 

Any  moneys  received  by  the  United  States  for  the  sale  of  any  such  coal  and  coke 
may,  in  the  discretion  of  the  President,  be  used  as  a  revolving  fund  for  further  carrying 
out  the  purposes  of  this  section.  Any  moneys  not  so  used  shall  be  covered  into  the 
Treasury  as  miscellaneous  receipts. 

That  when  directed  by  the  President,  the  Federal  Trade  Commission  is  hereby  re- 
quired to  proceed  to  make  full  inquiry,  giving  such  notice  as  it  may  deem  practicable, 
into  the  cost  of  producing  under  reasonably  efficient  management  at  the  various,  places 
of  production  the  following  commodities,  to  wit,  coal  and  coke. 

The  books,  correspondence,  records,  and  papers  in  any  way  referring  to  transactions 
of  any  kind  relating  to  the  mining,  production,  sale,  or  distribution  of  all  mine  operators 
or  other  persons  whose  coal  and  coke  have  or  may  become  subject  to  this  section,  and 
the  books,  correspondence,  records,  and  papers  of  any  person  applying-  for  the  purchase 
of  coal  and  coke  from  the  United  States  shall  at  all  times  be  subject  to  inspection  by 
the  said  agency,  and  such  person  or  persons  shall  promptly  furnish  said  agency  any 
data  or  information  relating  to  the  business  of  such  person  or  persons  which  said  agency 
may  call  for,  and  said  agency  is  hereby  authorized  to  procure  the  information  in  refer- 
ence to  the  business  of  such  coal-mine  operators  and  producers  of  coke  and  customers 
therefor  in  the  manner  provided  for  in  sections  six  and  nine  of  the*  act  of  Congress  ap- 
proved September  twenty-six,  nineteen  hundred  and  fourteen,  entitled  "An  act  to 
create  a  Federal  Trade  Commission,  to  define  its  powers  and  duties,  and  for  other 
purposes,"  and  said  agency  is  hereby  authorized  and  empowered  to  exercise  all  the 
powers  granted  to  the  Federal  Trade  Commission  i>y  said  act  for  the  carrying  out  of  the 
purposes  of  this  section. 

Having  completed  its  inquiry  respecting  any  commodity  in  any  locality,  it  shall,  if  the 
President  has  decided  to  fix  the  prices  at  which  any  such  commodity  shall  be  sold  by 
producers  and  dealers  generally,  fix  and  publish  maximum  prices  for  both  producers  of 
and  dealers  in  any  such  commodity,  which  maximum  prices  shall  be  observed  by  all 
producers  and  dealers  until  further  action  thereon  is  taken  by  the  commission. 

In  fixing  maximum  prices  for  producers  the  commission  shall  allow  the  cost  of  produc- 
tion, including  the  expense  of  operation,  maintenance,  depreciation,  and  depletion,  and 
shall  add  thereto  a  just  and  reasonable  profit. 

In  fixing  such  prices  for  dealers  the  commission  shall  allow  the  cost  to  the  dealer  and 
shall  add  thereto  a  just  and  reasonable  sum  for  his  profit  in  the  transaction. 

The  maximum  prices  so  fixed  and  published  shall  not  be  construed  as  invalidating  any 
contract  in  which  prices  are  fixed,  made  in  good  faith,  prior  to  the  establishment  and 
publication  of  maximum  prices  by  the  commission. 

Whoever  shall,  with  knowledge  that  the  prices  of  any  such  commodity  have  been  fixed 
as  herein  provided,  ask,  demand,  or  receive  a  higher  price,  or  whoever  shall,  with  knowl- 
edge that  the  regulations  have  been  prescribed  as  herein  provided,  violate  or  refuse  to 
conform  to  any  of  the  same,  shall,  upon  conviction,  be  punished  by  fine  of  not  more  than 
$5,000,  or  by  imprisonmnt  for  not  more  than  two  years,  or  both.  Each  independent 
transaction  shall  constitute  a  separate  offense. 

Nothing  in  this  section  shall  be  construed  as  restricting  or  modifying  in  any  manner 
the  right  the  Government  of  the  United  States  may  have  in  its  own  behalf  or  in  behalf  of 
any  other  Government  at  war  with  Germany  to  purchase,  requisition,  or  take  over  any 
such  commodities  for  the  equipment,  maintenance,  or  support  of  armed  forces  at  any 
price  or  upon  any  terms  that  may  be  agreed  upon  or  otherwise  lawfully  determined. 

125547°— 20 41 


642 


HISTORY   OF  PRICES   DURING  THE   WAR. 


The  formal  control  over  prices  of  coat  and  coke  was  discontinued  by  the 
Fuel  Administration  on  January  31,  1919,  and  the  orders  governing  the  oil 
industry  were  set  aside  on  May  15,  1919. 

Regulations  affecting  the  prices  of  fuel  are  here  arranged  under  the  following 
heads  in  the  sequence  indicated:  Anthracite  coal,  bituminous  coal,  coke, 
jobbers'  margins  and  distributers'  commissions,  retail  margins,  and  petroleum 
stabilization. 

ANTHRACITE  COAL. 

The  maximum  prices  of  anthracite  coal  were  provisionally  fixed  by  order  of 
the  President  on  August  23,  1917.  The  prices  named  in  that  order,  effective 
on  September  1,  1917,  were  made  applicable  to  the  following  specific  producers : 
Philadelphia  &  Reading  Coal  &  Iron  Co.;  Lehigh  Coal  &  Navigation  Co.; 
Lehigh  &  Wilkes-Barre  Co.;  Hudson  Coal  Co.;  Delaware  &  Hudson  Co.; 
Scranton  Coal  Co. ;  Lehigh  Valley  Coal  Co. ;  Coxe  Bros.  &  Co. ;  Pennsylvania 
Coal  Co. ;  Hillside  Coal  &  Iron  Co. ;  Delaware,  Lackawanna  &  Western  Rail- 
road Co. ;  Delaware,  Lackawanna  &  Western  Coal  Co. ;  Susquehanna  Coal  Co. ; 
Susquehanna  Colleries  Co. ;  Lytle  Coal  Co. ;  M.  A.  Hanna  Coal  Co.  Other 
producers  were  not  to  exceed  the  scheduled  fixed  prices  by  more  than  75  cents 
per  ton,  but  any  producer  rescreening  at  Atlantic  or  Lake  ports  for  shipment 
by  water  might  increase  the  price  by  not  more  than  5  cents  per  ton. 

All  anthracite  prices,  unless  otherwise  noted,  were  maximum  prices  per  ton 
of  2,240  pounds,  f.  o.  b.  cars  at  mine.  The  anthracite  prices  scheduled  do  not 
include  allowance  for  a  wage  increase  under  the  President's  order  of  Decem- 
ber 5,  1917.  The  increase  of  35  cents  per  ton  provided  in  that  order  should 
be  added  to  all  except  the  Arkansas  prices  after  December  5,  1917. 

A  digest  of  the  prices  contained  in  the  President's  order,  and  the  later 
modifications  and  additions  made  by  the  Fuel  Administrator,  follows  :* 

SCHEDULE  OF  ANTHRACITE  BASE  PRICES. 


Commoditj". 

Date  when 
effective. 

Price 
fixed 
per  ton. 

Commodity. 

Date  when 
effective. 

Price 
fixed 
per  ton. 

White-ash  grade: 
Broken 

Sept     1  1917 

$4.55 

Red-ash  grade—  -Contd. 
Chestnut 

Sept     1  1917 

$4  % 

Egg  

...do... 

4.45 

Pea 

d'o 

4  10 

Stove 

do 

4  70 

Do 

Oct       1  1917 

3  50 

Chestnut  

...do  

4.80 

Lykcns  Valley  grade: 

Pea 

do 

*  4  00 

Broken 

Sept     1  1917 

5  00 

Do     

Oct.     1,1917 

3.40 

Egg 

do 

4  90 

Red-ash  grade: 

Stove  

.  do 

5.30 

Broken  

Sept.    1,  1917 

4.75 

Chestnut 

do 

5  30 

Egg  

...do... 

4.65 

Pea... 

do 

4.35 

Stove  

do 

4.90 

Do 

Oct       1  1917 

3  75 

1  Prices  of  all  Arkansas  anthracite,  except  slack,  were  subject  to  the  following  reduc- 
tions per  ton  for  the  summer  of  1918  :  April,  90  cents  ;  May,  75  cents  :  June,  60  cents  ; 
July,  45  cents  ;  August,  30  cents  ;  September,  15  cents.  Coal  at  docks  on  Lake  Michigan 
or  Lake  Superior  were  subject  to  a  general  summer  reduction  of  30  cents  per  gross  ton 
until  September  1,  1918.  Coal  prices  at  Lake  ports  were  based  on  freight  rates  effective- 
June  25,  1918,  from  the  mines  to  Lake  Erie  ports.  Virginia  and  West  Virginia  anthra- 
cite was  subject  to  a  summer  reduction  of  30  cents  per  net  ton  from  April  1  to 
September  1,  1918. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 
SCHEDULE  OF  ANTHRACITE  BASE  PRICES— Continued. 


643 


Commodity.          *•£•*£ 

! 

Price  fixed 
per  ton. 

Commodity. 

Date  when 
effective. 

Price  fixed 
per  ton. 

Bernice 
mines. 

Spadra  '. 
field. 

Bernice 
mines. 

Spadra 
field. 

Arkansas  mines:     ! 
Grate  Jan.     5,1918 

$7.30 
7.55 
8.30 
8.30 
6-30 
2.85 
2.50 
7.75 
8.00 
8.75 
8.75 

$6.80 
6.80 

Arkansas  mines- 
Continued  . 
Pea 

May  15,1918 
..  do 

$6.75 
2.85 
2.50 
8.75 
9.00 
9  75 

S5.25 

Eec                           do 

Stove                          do         .  . 

Buck  .  . 

No  4                          do 

7.30 
4.80 

Slack 

do 

2.50 

8.75 
8.75 

Pea                            do 

Grate 

Buck                          do 

Egg 

Slack                          do 

2.50 
7.25 
7.25 

Stove 

Grate     .              May   15,1918 

No.  4... 

9.75 
6.75 
4.75 

9.25 

5.25 

Egg                            do 

Pea 

Stove                         do 

Buck 

No.  4     .                    do. 

7.75 

Slack  

2.50 

2.50 

^                                   Date  when 
Commodity.                  effective. 

Price 

fixed 
per  ton. 

Commodity.                  "*$£ 

Price 
fixed 
per  ton. 

Coal  at  Great  Lake  docks: 
Broken                              June 

25,  1918 
•» 

$10.20 
10.10 
10.35 
10.45 

8.80 

5.40 
5.75 

5.75 
4.60 

Virginia—  Continued  . 
Buckwheat                       July 

22,  1918 

i 

$1.55 
.90 
5.30 

5.40 
5.75 

5.75 
5.30 
4.60 

Egg                                           d 

Culm                                        dc 

Stove                           .     ..  do  .... 

Briquettes  do  

Nut                                           do 

West  Virginia: 
Egg  Aug. 

29,1918 

> 

Pea  do  

Virginia: 
Egg                                      Jnlv 

22,1918 
).  .  . 

Stove                             .          dc 

Nut                                           do 

Stove                                        dc 

Briquettes  do.  .  .   . 

Nut                                           do 

Pea  and  smulle 

Pea  do  

Price  fixed  per  ton. 

Commodit 

Price  fixed  per  ton. 

Commodity.1 
Compa- 
nies. 
s 

Individ- 
uu  Is. 

Compa 
nies. 

Individ- 
uals. 

White-ash  grade: 
Broken 

$5.95 
5.85 
6.10 
6.20 
4.80 

6.15 
5.45 
6.30 

$6.70 
0-60 
6.85 
6-95 
5.55 

6-90 
6.20 
7.05 

Red-ash  grade  —  Continued. 

Nut 

$6.30 
4.90 

6.40 
6-30 
6.70 
6.70 
5.15 

$7.05 
5.65 

7.15 
7.05 
7.45 
7.45 
5.90 

Egg 

Pea 

Stove      ' 

Lykens  Valley  grade: 
Broken 

Nut 

Pea                                     i 

Egg 

Red-ash  grade: 
Broken 

Stove.. 

Nut 

Egg  

Pea  

Stove 

1  Effective  on  coal  mined  on  or  after  Nov.  1, 1918. 

NOTE. — The  anthracite  price  schedule  has  been  revised  to  meet  increased  labor  costs  and  includes  only 
the  actual  additional  cost  of  a  recent  adjustment  of  anthracite  wages. 

The  sizes  scheduled  comprise  70.6  per  cent  of  the  total  anthracite  output.  Remaining  anthracite  sizes, 
comprising  29.4  percent  of  the  output  are  nearly  stationary  at  existing  quotations,  and  no  price  adjustment 
was  made  as  to  them. 

Under  order  of  November  16,  1918,  maximum  prices  for  the  different  sizes  of  anthracite  smaller  than 
"pea,"  f.  o.  b.,  mines,  were  made  that  for  "pea"size  less  50 cents  per  gross  ton  of  2,240  pounds. 

BITUMINOUS  COAL. 

The  maximum  prices  oi'  bituminous  coal  at  the  mine  were  tentatively  fixed 
for  the  entire  country  by  order  of  the  President  on  August  21,  1917. 

All  bituminous  coal  prices  were  f.  o.  b.  mine  basis,  per  ton  of  2,000  pounds, 
and  do  not  include  allowance  for  wage  increase  under  the  President's  order 
of  October  27,  1917.  An  increase  of  45  cents  per  net  ton,  granted  in  that 
order,  should  be  added  to  all  prices,  except  those  for  coal  mined  in  Alabama. 


644 


HISTORY   OF   PRICES   DURING   THE   WAR. 


In  Alabama  a  separate  and  satisfactory  wage  agreement  was  made  between 
mine  operators  and  mine  workers  and  approved  by  the  Fuel  Administrator, 
modifying  the  terms  of  the  President's  order  of  October  27,  1917.  This  agree- 
ment became  effective  February  6,  1918.  On  April  20  new  terms  were  agreed 
upon  in  Alabama  and  the  allowance  of  45  cents  per  net  ton,  as  of  the  order 
of  October  27,  1917,  became  effective  May  15,  1918. 

On  May  24,  1918,  there  was  a  general  order  reducing  all  prices  for  bituminous 
coal,  fixed  to  that  date,  by  the  sum  of  10  cents  for  each  net  ton  of  2,000 
pounds. 

A  digest  of  the  schedule  of  prices  contained  in  the  President's  order  and 
subsequent  amendments  made  by  the  United  States  Fuel  Administrator  follow  :* 
SCHEDULE    OF    BITUMINOUS    BASE    PRICES. 
[Prices  fixed  by  the  President  on  Aug.  21,  1917.] 


District. 

Run  of 
mine. 

Pre- 
pared 
sizes. 

Slack  or 
screen- 
ings. 

Alabama: 
Big  Seam 

$1.90 

S2.15 

$1.65 

2.15 

2.40 

1.90 

Cahaba  and  Black  Creek                                                                   .  ... 

2.40 

2.65 

2.15 

2.65 

2.90 

2.40 

Colorado                                                                                          -             

2.45 

2.75 

2.20 

1.95 

2.20 

1.70 

Third  vein                                                                         .           

2.40 

2.65 

2.15 

1.95 

2.20 

1.70 

Iowa                                                                            

2.70 

2.95 

2.45 

2.55 

2.80 

2.30 

Kentucky                                                                       

1.95 

2.20 

1.70 

Jellico 

2.40 

2.65 

2.15 

Maryland                                                                  

2.00 

2.25 

1.75 

2.70 

2.95 

2.45 

Montana                                               

2.70 

2.95 

2.45 

New  Mexico 

2.40 

2.65 

2.15 

Ohio: 
Thick  vein                                                                                          -  -  - 

2.00 

2.25 

1.75 

2.35 

2.06 

2.10 

3.05 

3.30 

2.80 

2.00V 

2.25 

1.75 

Tennessee: 

2.30 

2.55 

2.05 

Jellico                                                                                        -             -  - 

2.40 

2.65 

2.15 

Texas                                 

2.65 

2.90 

2.40 

Utah                                                                                          

2.60 

2.85 

2.35 

3.25 

3.50 

3.00 

West  Virginia                                                 

2.00 

2.25 

1.75 

2.50 

2.75 

2.25 

MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATES  FUEL 

ADMINISTRATOR. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared 
sizes. 

Slack  or 
screen- 
ings. 

Alabama: 
Big  Seam 

Oct.     1.1917 

$2.15 

$2.45 

$1.85 

Cahaba,  Black  Creek,  Brookwood,  Blue  Creek  
Pratt  Jaeger  Jefferson  Nickel  Plate  and  Coal  City 

do  
.do  

2.85 
2.35 

3.10 
2.65 

2.45 
2.05 

Corona 

do 

2.40 

2.75 

2.05 

•  Montavello 

.do  

2.40 

4.00 

2.15 

Sunlight  Mining  Co.,  in  Walker  County  

Dec.     1,1917 

2.85 

3.10 

2.45 

Benoft  Coal  Mining  Co.  and  Cordova  Fuel  Co.,  in 
Walker  County  .  .  . 

Dec.     6,  1917 

2.85 

3.10 

2.45 

1  Temporary  schedules  were  published  for  the  summer  months  allowing  reductions,  as 
follows  : 

1.  Colorado  :  Domestic  coal,  domestic  field — April,  70  cents  ;  May,  50  cents  ;  June,  35 
cents;  July,   15  cents.      Steam  coal,  Trinidad  district— April,   40  cents;   May,  30  cents; 
June,  20  cents  ;  July,  10  cents. 

2.  Arkansas  and  Oklahoma  :  March,  75  cents  ;  April,  CO  cents  ;  May.  45  cents  ;  June,  30 
cents  ;  July,  15  cents. 

3.  New   Mexico:    April,    50   cents;   May,   40   cents;    June,    30    cents;   July,    20   cents; 
August,  10  cents. 

4.  Texas:  April,  75  cents;  May,  60  cents;  June,  45  cents;  July,  30  cents;  August,  15 
cents. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


645 


MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATES  FUEL 
ADMINISTRATOR— Continued. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared 
sizes. 

Slack  or 
screen- 
ings. 

Alabama  —  Continued. 
Linn  mines  of  Monroe-  Warrior  Coal  &  Coke  Co.,  to 
supply  Macon  Ga 

Dec.  10  1917 

$3.50 

$4.00 

$3  10 

Gilbert  Coal  Mining  Co.,  Walker  County,  and  the 
Mount  Carmel  seam 

Dec.   20,1917 

2.85 

3.10 

2  45 

Climax  seam,  in  or  about  Maylene,  Shelby  County  
Big  Seam.  IJpper  Bench  supersedes  orders  of  Dec.  6 
and  Dec  20  1917 

Jan.    17,1918 
do 

4.25 
2.35 

4.50 
2.65 

2.15 
2.05 

Cahaba  Southern  Coal  Mining  Co.,  Hargrove,  Bibb 
County 

Feb.     4  1918 

2.85 

3.70 

2.45 

District  'No.  1,  Big  Seam  group  
District  No  2  Cahaba  group  Black  Creek  group 

Aug.  23,1918 
.do  

2.00 
3.00 

2.30 
3.30 

1.95 
2.65 

District  No  3  Pratt  group 

do     . 

2.40 

2.60 

2.00 

District  No.  4,  Helena  and  Harkness  seams  and  coal 
mined  by  No.  2  Belle  Ellen  mine  in  Youngjblood  seam 
District  No.  5,  mines  in  the  Climax  seam,*  in  or  about 
Mavlene  Shelby  County 

do  
do 

2.45 
4.15 

2.75 
4.40 

2.25 
2.05 

Montovello  Mining  Co  

Oct.      7,  1918 

3.65 

3.90 

3.15 

Warrior  Pratt  Coal  Co 

Oct.    18,  1918 

2.25 

2.50 

2.00 

West  Helena  Coal  Co 

do 

3  00 

3  30 

2  65 

Montovello  Stroven  Coal  Co 

Nov.    6,1918 

3.65 

3.90 

2.65 

Yolande  Coal  &  Coke  Co  

Dec.   15,1918 

3.00 

3.30 

2.65 

Arkansas: 
Thin  vein  seam,    Hartford,    Greenwood,    Midland, 
Hackett,  and  Denning 

Oct.      1,1917 

3.05 

3.40 

2.40 

Paris  field 

Oct     27  1917 

4.50 

2.00 

Johnson,  Franklin,  and  Sebastian  Counties,  except 
the  Excelsior  district 

Mar    29  1918 

3.70 

4.60 

2.40 

Logan  and  Scott  Counties  and  Excelsior  district  of 
Sebastian  County,  namely,  mines  on  the  Midland 
Valley  Railroad  north  of  Montreal  Junction  and 
east  of  Hackett  and  west  of,  but  not  at,  Greenwood  .  .  . 
Colorado: 
Walsenberg,  Canon  City,  Routt,  Garfleld,  Gunnison, 
Durango,  Mesa,  Pitkin,  Montezuma,  Delta,  Mont- 
rose  and  Rio  Blanca  (domestic  coal)  

do  
Oct.    10.1917 

4.35 

^~ 
3.00 

5.15 
4.00 

2.60 
1.50 

Trinidad  (steam  coal) 

do 

2.75 

3.25 

2.00 

Do  

Mar.  11,1918 

2.35 

3.25 

1.65 

Northern  field  and  El  Paso  (lignite) 

Oct     10  1917 

2.45 

3.50 

1.00 

Do  

Nov.  22,1917 

2.45 

3.50 

1.25 

Domestic  (domestic  coal)  

Mar.  11  1918 

2.25 

3.50 

1.25 

Lignite  coal 

do 

2  25 

3  25 

J.OO 

Florence,  Fremont  County,  Williamsburg  Slope  Coal 
Co 

May     1  1918 

2  25 

4  25 

1.25 

Walsenberg  district:  Aztec  Coal  Mining  Co.,  Caprock 
Fuel  Co.,  Monument  Valley  Fuel  Co.,  Caddell  & 
Carlson,  Premium  Mining  Co.,  Rugby  Fuel  Co., 
Gordon  Coal  Co.,  Black  Canon  Coal  &  Fuel  Co.. 
Geo.  McNally  Coal  Co.,    Black  Hawk  Coal  Co., 
Ideal  Fuel  Co.,  Green  Coal   Co.,  Minnequa  Coal 
Co  

June  14,1918 

2.15 

4.15 

1.15 

Nut  .                                     ....            $3.65 

Canon  City:  Royal  Gorge  mine,  Gibson  Lumber  & 
Fuel  Co  

June  15,1918 

2.  65 

4.15 

1.40 

Nut  ..                 $3  65 

Canon  City  district:  Radiant  mine  

Aug.  20,1918 

2.15 

4.15 

1.15 

Walsenberg  district:  Ravenwood  mine,  Rapson  Min- 
ing Co.,  Cedar  Hill  Coal  &  Coke  Co  .  ,  Oakdale  Coal  Co 

do 

2.15 

4.15 

1.15 

Trinidad  district:  Gray  Creek  mine,  of  the  Victor  Am. 
Fuel  Co.,  Empire  mine  of  the  Empire  Mining  Co  
Canon  City  district:  Wolf  Park  Coal  Co 

Aug    30,1918 
do 

3.00 
2.15 

3.15 
4.15 

1.55 
1.15 

Reliance  mine  by  Alliance  Coal  Co  

Oct.     8,1918 

2.15 

4.15 

1.15 

Temple  Fuel  Co  

Nov.  18  1918 

2.15 

3.40 

1.55 

G  eorgia       

Apr.     5  1918 

3.25 

3.50 

3.20 

Illinois: 
McLean  County  Coal  Co  ,  retail  only 

Oct.    27  1917 

4.00 

1.70 

Counties  of  Peoria,  Fulton,  and  Tazewell  

Dec.     8,1917 

2.30 

2.55 

2.05 

Illinois  (third  vein)  northern  field  (conditional)  and 
Matherville  field,  Mercer  County 

do 

2.65 

2.90 

2.40 

Moweaqua  Coal  Mining  &  Manufacturing  Co.,  Mowea- 
qua,  Christian  Countv  

Feb.   13,1918 

2.40 

2.  C5 

2.15 

Assumption  Coal  &  Mining  Co.  ,  Assumption,  Christian 
County 

do 

3.00 

4  55 

2.15 

Spoon  River  Colliery  Co.,  Ellis  ville  (listed  in  the 
northern  Illinois  field) 

.  .    do  

2.  65 

2.90 

2.40 

District  No.  1:  Mercer,  Bureau,  Kankakee,  La  Salle, 
Grundy,  Will  Putnam,  Marshall,  Livingston,  Wood- 
ford,  and  McLean  Counties..  . 

Mar.  23.1918 

2.C5 

2.90 

2.40 

646 


HISTORY   OF   PRICES    DURING   THE    WAR. 


MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATES  FUEL 
ADMINISTRATOR— Continued. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared 
sizes. 

Slack  or 
screen- 
ings. 

Illinois—  Continued. 
District  No.  2:  Rock  Islnnd,  Henry,  Warren,  Knox, 
Stark,  Peoria,  Hancock,  McDoriough,  Henderson, 
Fulton,  Tazewell,  and  Schuyler  Counties  
District  No.  3:  Menard,  Logan,  Dewitt,  Champaign, 
Vermilion,    Sangamon,    Macon,    Pratt,   Christian, 
Moultrie,    Shelby,  Greene,    Macoupin  and  Mont- 
gomery Counties,  and  Madison  County  north  of  the 
latitudeof  Alton;  also  all  mines  not  included  in  other 
rulings  

Mar.  23,1918 
do.. 

$2.40 
2.00 

.  S2.f>0 
2.20 

$2.10 
1  70 

DistrictNo.4:  Bond,  St.  Clair,  Monroe,  and  Randolph 
Counties,  and  Madison  County  south  of  the  latitude 
of  Alton,and  Clinton,  Washington,  and  Perry  Coun- 
ties, not  including  mines  along  the  line  of  Illinois 
Central  Railroad  between  Vandalia  and  Carbondale  .  . 
District  No.  5:  Jackson  County,  not  including  mines 
on  the  line  of  the  Illinois  Central  Railroad  between 
Carbondale  and  Duquoin  

do  
do  

2.00 
2.40 

2.20 
2.60 

1.70 
2.10 

District  No.  6:  Marion,  Jefferson,  Franklin,  William- 
son, Johnson,  Hamilton,  Saline,  White,  Gallatin, 
and  mines  along  the  mainline  of  the  Illinois  Central 
Railroad  between  Vandalia  and  Carbondale  in  Clin- 
ton, Washington,  Perry,  and  Jackson  Counties 

do 

2  00 

2  20 

1  70 

Macon  County  '.  

May     1,1918 

2.25 

2.50 

1.70 

Latham  Coal  &  Mining  Co.  ,  Logan  Count  v  

Oct.     1,1918 

2.05 

2.25 

1.75 

Searls  Coal  Co.,  in  Williamson  County,  passing  through 
a  li-inch  screen 

Jan      6  1919 

1  60 

Indiana: 
Brazil  block  . 

Oct.     1  1917 

2  95 

1  70 

Indiana  

May     1  1918 

2  00 

2  20 

1  70 

Brazil  block 

do 

2  95 

3  25 

1  70 

Essanbee  Mine  Co.,  Vermilion  County 

Aug.  19,  1918 

2  30 

2-50 

2.00 

Atlas  Mining  Co.  at  Linton  Summit  mine,  Greene 
County 

Sept   25  1918 

2  20 

2  40 

1  90 

Iowa: 
Appanoose,  Wayne,  Boone,  and  Webster  Counties  
Appanoose,   Wayne,   Boone,   Webster,  and  Marion 
Counties  

Oct.      1,  1917 
Mar.  11,1918 

3.15 
2  75 

3.40 
3.10 

2.90 
2.00 

Marion  County.  . 

Apr.     5,  1918 

2  70 

2  95 

2  45 

Kansas: 
Mines  at  Leavenworth  take  prices  for  Platte  County, 
Mo.  . 

Oct      1  1917 

3  15 

3  40 

2  90 

Osage  County  .  . 

do 

2  55 

4  00 

2  30 

Do 

Dec      1  1917 

3  05 

4  ^0 

2  80 

Cherokee  and  Crawford  Counties,  except  shaft  mines 
in  Lightning  Creek  or  upper  thin  vein  and  any  min- 
ing operations  in  the  State  not  covered  by  other  rul- 
ings   

Apr    20  1918 

2  70 

2  95 

2  45 

Shaft  workings  in  the  Lightning  Creek  or  upper  thin 
vein  in  Cherokee  and  Crawford  Counties  

do.. 

3.65 

3.95 

2.45 

Osage,  Franklin,  and  Linn  Counties.  . 

do 

3  50 

4  50 

2  80 

Leavenworth  County 

do 

3  40 

3  65 

2  00 

Cherokee  and  Crawford  Counties  ... 

Aug.     3,  1918 

Nut  run  or  stoker  coal  .                                  $3  05 

Mill  coal                                                                2  95 

Kentucky: 
Whifley,  Knox,  Clay,  and  Bell  Counties,  Blue  Gem 
district...  . 

Nov     6,  1917 

3  55 

3  80 

2  30 

McCreary,  Pulaski,  Rockcastle,  Jackson.  Lee,  Wolfe, 
Morgan,  Lawrence,  Johnson,  Martin,  Laurel,  Whit- 
ley,  Clay,  Omsley,  Knox,  Bell,  Breathitt,  Perry, 
Leslie,  Harlan,  Magoffin.  Boyd,  Carter,  Pike,  and 
all  of  Floyd,  Knott,  and  I/etcher  Counties  excepting 
coal  produced  from  the  thick-  vein  Elkhorn  district 
in  these  three  counties  
Whitley.  Knox,  Bell,  and  McCreary  Counties,  other 
than  the  Blue  Gem  district  (conditional)  
Harlan,  Perry,  and  Letcher  Counties  and  operations 
in  Pike  County  on  the  Levisa  Fork  of  the  Big  Sandy 
River 

Oct.    11,1917 
Dec.     3,  1917 

•\.pr      5  1918 

2.40 

2.65 

2  20 

2.65 
2.90 

°  45 

2.15 
2.40 

1  95 

East  of  the  85th  degree  of  longitude  except  Harlan, 
Perry,  Letcher,  Pike,  and  Martin  Counties.  . 

do.. 

2.65 

2.90 

2.40 

Thacker  district;   operations  in  Pike  County  on  the 
watershed  of  the  Tug  Fork  of  the  Big  Sandy  River 
east  of  Williamson,  on  the  Norfolk  &  Western  Ry.  . 
Kenova  district;  operations  in  Pike  and  Martin  Coun- 
ties on  the  watershed  of  the  Tug  Fork  of  the  Big 
Sandy  River  west  of  Williamson,  on  the  Norfolk  & 
Western  Ry.. 

Apr.  20,1918 
...do.. 

2.30 
2.30 

2.55 
2.55 

2.05 
2.05 

GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


647 


MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATES  FUEL 
ADMINISTRATOR— Continued. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared 
sizes. 

Slack  or 
screen- 
ings. 

Kentucky—  Continued. 
Blue  Gem  coal  produced  in  Knox  and  Whitley  Coun- 
ties by  operators  who  are  members  of  the  Tri-County 
Blue  Gem  Coal  Operators'  Association  

Mar    -1,1918 
Aug.  19,  1918 

...do... 

$3.55 
3.25 

2.55 
1.90 

2.10 
2.55 

2.55 
2.60 

2.15 

2.60 

2.15 
3.30 

2.55 
2.20 
2.20 

3.45 
3.25 
2.55 
3.45 

2.35 
2.75 

2.40 
3.15 

3.40 

$3.80 
3.50 

2.80 
2.'15 

2.35 
2.80 

2.80 
2.85 

2.40 
2.85 

2.40 
4.05 

2.80 
2.45 
2.45 

3.70 
3.50 
2.80 
3.50 

2.60 

$2.40 
2.50 

2.30 
1.60 

1.85 
2.30 

2.30 
2.30 

1.85 
2.30 

1.85 
2.30 

2.30 
1.95 
1.95 

2.30 
2.50 
2.30 
2.30 

2.00 

Wallen  Jellico  Coal  Co    in  Whitley  County   . 

Elkhora  City  Coal  Co.  and  Guthrie  Coal  Co.,  in  Pike 
County  

District  No.  1,  west  of  the  85th  degree  of  longitude  
District  No.  2,  Harian,  Letcher,  and  Perry  Counties, 
except  the  operations  in  Perry  County  included  in 
district  No  3                                             ... 

Aug.  23,1918 
do.. 

Loony  Creek  Coal  Co    Harian  County 

Oct.     5,1918 
.do.  .      . 

Reliance  Coal  &  Coke  Co.,  at  the  Glowrnar  mine  in 
Perry  County 

Blue  Gem  coal  mined  in  Knox  and  Whitley  Counties 
by  operators  who  are  members  of  the  Tri-County 
Blue  Gem  Coal  Operators'  Association 

Oct.    28,1918 
do  

Clover  Fork,  Golden  Ash,  King  Harian,  Lick  Branch, 
Wilson  Berger,  East  Harian,  R.  C.  Tway,  White 
Star,  Harian  Fox,  '  Walliiis  Creek,  Harian  Gas, 
Creech,  Banner  Fork.  MeCoinb,  Bear  Branch,  Ken- 
tucky Harian,  Middleton,  or  Kentucky  Coal  Co.  in 

Utility  Gas  Coal  Co.,  Kanawha  Knox  Coal  Co.,  Ben- 
netts Fork  Coal  Co.,  J.  B.  Blue  Gem  Coal  Co.,  J.  B. 
Jellico  Coal  Co.,  J.  B.  Straight  Creek  Coal  Co.,  Paige 
Jellico  Coal  Co.,  and  Pine  Ridge  Coal  Mining  Co.  in 
Bell  County  .  .  .  

do1  

Spring  Branch  Coal  Co.,  High  Point  Coal  Co.,  Harlan- 
KeUioka  Coal  Co.,  J.  L.  Smith  Coal  Co.,  Adair  Min- 
ing Co.,  Baileys  Creek  Coal  Co.,  High  Splint  Coal 
Co.,  Wilson  Berger  Coal  Co.,  and  Black  Mountain 
Coal  Corporation  in  Harian  County  

..  .do  

Blue  Gem  Coal  mined  in  Knox  and  Whitley  Counties 
by  operators  who  are  members  of  the  Tri-County 
Blue  Gem  Coal  Operators'  Association 

Dec.     7,1918 

Aug.  23,1918 
do 

Nut  and  slack  through  1-i-inch  bars  $2.  55 

District  No.  3:  East  of  the  85th  degree  of  longitude, 
excepting  Harian,  Letcher,  and  Martin  Counties; 
that  part  of  Pike  County  on  the  watershed  of  the  Tug 
Fork  of  the  Big  Sandy  River,  and  that  part  of  Perry 
County  included  in  district  No.  2,  but  including  the 
operations  in  Perry  County  of  Hazard  Coal  Co.,  Dia- 
mond Block  Coal  Co.,  ConevaCoalCorporationrStorm 
King  Coal  Co.,  C.  H.  McDonald  Coal  Co.,  Four  Seam 
Block  Coal  Co.,  Daniel  Boone  Coal  Co.,  Blue  Grass 
Coal  Corporation,  Columbus  Mining  Co.,  No.  4  Coal 
Co..  and  Walker's  Branch  Mining  Co  

District  No.  4,  or  Thacker:  Operations  in  Pike  Coun- 
ty on  the  watershed  of  theTug  Fork  of  the  Big  Sandy 
River  east  of  Williamson  on  the  Norfolk  &  Western 
R  R 

District  No.  5,  or  Kenova:  Martin  County,  and  opera- 
tions in  Pike  County  on  the  watershed  of  the  Tug 
Fork  of  the  Big  Sandy  River  west  of  Williamson  on 
the  Norfolk  &  Western  R.  R  ... 

.do 

The  following  producers  are  not  included: 
Blue  Gem  Coal  produced  in  Knox  and  Whitley  Coun- 
ties by  operators  who  are  members  of  the  Tri-County 
Blue  Gem  Coal  Operators'  Association  

.do.  

Coal  produced  in  Whitley  County  by  the  Wallen- 
Jelhco  Coal  Co 

do 

Coal  produced  in  Pike  County  by  the  Elkhorn  City 
Coal  Co  and  the  Guthrie  Coal  Co 

do 

Kentucky  Block  Cannel  Coal  Co.  south  of  the  Licking 
River  in  Morgan  County 

Sept.  25,  1918 
do 

Norton  Coal  Co.,  White  Plains  Coal  Co  and  B.  D. 
Williams  Coal  Co.  in  the  Empire  or^  Mannington 
seam  in  Christian  and  Hopkins  Counties  . 

Maryland: 
The  North  Maryland  Coal  Mining  Co.  in  Allegany 
County 

Dec.     3,1917 

Feb.     1,1918 
Oct.    27,1917 

Nov.  30,1917 

The  upper  Potomac,  Cumberland,  and   Piedmont 
fields,  comprising  all  coal  mined  in  the  State  of 
Maryland  and  in  parts  of  West  Virginia  
Michigan 

2.65 
3.60 

3.95 

2.15 
2.20 

2.25 

What  Cheer  Mining  Co.,  Banner  Coal  Co.,  Bliss  Coal 
Co.,  Robert  Gage  Coal  Co.,  Beaver  Coal  Co.,  Consoli- 
dated &  Wolverine  Coal  Cos... 

Announced  Jan.  2f  1918. 


648 


HISTORY   OF   PRICES   DURING   THE   WAR. 


MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATFS  FUFT, 
ADMINISTRATOR— Continued. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared 
sizes. 

Slack  or 
screen- 
ings. 

Michigan  —  Continued. 
Handy  Bros  

Nov.  30,  1919 
do  
...  .do. 

$3.70 
4.55 

$4.25 
5.05 
5.55 

3.85 
4.15 
4.95 
5.45 

3.40 
3.40 

2.95 

3.40 

3.95 
3.65 

$2.55 
3.55 
3.55 

2.50 
2.80 
3.80 
3.80 

2.90 
2.90 

2.45 

2.45 

2.45 
2.45 

Caledonia  mine,  operated  by  the  Robert  Gage  Coal  Co 
Flint  mine,  operated  by  the  What  Cheer  Mining  Co.  . 

What  Cheer  Mining  Co".,  Banner  Coal  Co.,  Bliss  Coal 
Co.,  Robert  Gage  Coal  Co.,  Beaver  Coal  Co.,  Consoli- 
dated &  Wolverine  Coal  Co.  ... 

Aug.  16,1918 
do 

3.30 
3.60 
4.45 
3.05 

3.15 
3.15 

2.70 

3.15 

3.65 
3.40 

Handy  Bros  

Caledonia  mine,  operated  by  Robert  Gage  Coal  Co  
Flint  mine,  operated  by  What  Cheer  Mining  Co  
Missouri: 
Lafayette  Ray,  Clay,  Platte,  and  Linn  Counties  
Putnam  County  and  the  Longwall  thin  vein  seam  in 
Randolph  County  ... 

do  
do  

Oct.     1,1917 
Oct.    27,1917 

Apr.   20,1918 
do 

District  No.  1:  Audrain,  Barton,  Bates.  Galloway, 
Henry,  Johnson,  Monroe,  Randolph,  Rails,  St.  Clair, 
Schuyler,  Vernon,  and  Montgomery  Counties;  Adair 
County  except  operations  of  the  Star  Coal  Co.,  and 
Macon  County  east  of  New  Cambria,  and  mining 
operations  not  covered  by  other  rulings  

District  No.  2:  Boone,  Clay,  Cooper,  Chariton,  Carroll, 
Dade,  Harrison,  Linn,  Lafavette,  Putnam,  Ray, 
and  Sullivan  Counties,  and  Macon  County  west  of 
New  Cambria,  and  the  long  wall  thin-seam  mines  in 
Randolph  County.  . 

Grundy  County,  operations  of  the  Star  Coal  Co.  in 
Adair  County  and  shaft  workings  in  the  Lightning 
Creek  or  upper  thin  vein  in  Barton,  Bates,  and  Ver- 
non Counties.  . 

do 

Platte  County  

do 

Barton  and  Vernon  Counties 

Aug.     3,  1918 

Sept.  14,1918 
Oct.    27,1917 
Mar.   11,1918 
May     1,1918 

Oct.    28,1917 
Nov.  26,1917 
.do  ... 

Nut  run  or  stoker  coal                                     $3  05 

4.  .50 
2.70 
2.65 
2.70 

2.75 
3.05 
4.05 
3.00 
2.35 
3.05 
4.25 
4.05 
3.00 
4.05 

2.25 

2.  2:> 
2.70 

3.75 
3.25 

2.00 
2.  3o 

3.00 

2.10 
2.50 

2.50 
2.25 

2.50 

5.00 
3.60 
3.30 
3.60 

3.25 

4.50 
5.05 
4.00 
3.25 
4.05 
5.05 
4.55 
4.00 
5.05 

2.45 
1.50 
1.50 
1.00 

2.00 
2.00 
3.55 
2.00 
1.65 
2.00 
3.55 
3.55 
2.00 
3.55 

1.25 

1.25 
1.00 

3.  -0 
3.00 

1.75 
2.10 

2.85 

1.85 
2.25 

2.25 
2.00 

2.  25 

Mill  coal  2  95 

Moniteau  and  Morgan  Counties.  . 

Montana  

Do  

Do  

New  Mexico: 
Raton  district... 

Gallup  field  

Cerrillos  and  Carthage  fields  

Sugarite  and  Monero  fields     . 

do 

Raton  district  

Apr.     1,1918 
.do.... 

Gallup  field  

Carthage  field... 

do 

Cerrillos  field... 

do 

Sugarite  and  Monero  fields 

do 

Cerillos  field  

Aug.  30,1918 
Jan.      4,1918 

May   24,1918 
....do  

Nov.    6.1917 
Jan.    23,1918 

Mar.  23,1918 
June  29,1918 

.do.. 

North  Dakota: 
Lignite  coal  

Screened  lump  .                                                $2  50 

$2.50 
3.00 

4.00 
3.50 

2.25 
2.60 

3.  25 

2.35 
2.75 

2.  75 
2.50 

2.  75 

6-inch  steam  lump  2.  00 

Lignite  coai,  mined  south  of  the  twelfth  standard  par- 
allel   

6-inch  steam  lump  $2 

All  coal  mined  north  of  the  twelfth  standard  parallel  .... 
6-inch  steam  lump  $2.50 

Ohio: 
Deerfield  or  Palmyra  field,  Massillon  field,  and  Jackson 

Do  

Jefferson,  Harrison,  Belmont,  Carroll,  and  Monroe 
Counties  

District  No.  1  :  Meigs  County,  Cheshire  and  Addi'son 
Townships  in  Gal  Ha  County  . 

District  No.  2:  Vinton,  Jackson,  Lawrence,  Scio'ta, 
Pike,  and  Gallia  Counties,  except  Cheshire  and  Ad- 
dison  Townships  in  Gallia  County  

District  No  .  3  :  Hocking  and  A  thens  Counties,  and  Coal 
Township  and  the  south  half  of  Monroe  Township 
Perry  County  

do 

The  Bailey  Run  or  No  7  seam 

do 

District  No.  4:  Noble  and  Washington  Counties,  Mor- 
gan County  ,  except  the  township  of  Homer,  and  Perry 
County,  except  the  townships  of  Coal  and  Monroe 

.do.. 

District  No.  5:  Guernsey  and  Muskingum  Counties.  .  . 
District  No.  6:  Holmes,  Tuscarawas,  Carroll,  Coshoc- 
ton  Counties  and  the  townships  of  Monroe,Franklin. 
Washington,  and  Freeport  in  Harrison  County  and 
the  townships  of  Washington  and  Yellow  Creek  in 
Columbiana  County,  and  the  townships  of  Brush 
Creek,  Saline,  Springfield,  Ross,  and  Knox  in  Jeffer- 
son County  

....do  
...do... 

GOVERNMENT   REGULATIONS    RELATING   TO   PRICES. 


649 


MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATES  FUEL 
ADMINISTRATOR— Continued. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared 
sizes. 

Slack  or 
screen- 
ings. 

Ohio—  Continued. 
District  No.  7:  Trumbull,  Portage,  Summit,  Mahoning, 
Medina,  Wayne,  Stark,  and  Columbiana  Counties, 
except  the  townships  of  Yellow  Creek  and  Washing- 
ton                                                             

June  29  1918 

$3  00 

$3  25 

52  85 

District  No.  8:  Monroe  County,  Belmont  County,  ex- 
cept Warren  Township;  Harrison  County,  except 
Monroe,  Franklin,  Washington,  and  Freeport  Town- 
ships; Jefferson  County,  except  Brush  Creek,  Saline, 
Ross  Knox,  and  Springfield  Townships  

do 

1.90 

2  15 

1  90 

Wayne  Mining  Co    Guernsey  County  . 

Aug    20  1918 

2  50 

2  75 

2  25 

District  No.  1             ."  

Aug    23'  19]  8 

2  .30 

2  55 

2  05 

District  No  2                                                         .  . 

do 

2  95 

3  20 

2  80 

DistrictNo.  3:  Hocking  and  Adams  Counties,  Coal  and 
Monroe  Townships  in  Perry  County,  and  Homer 
Township  in  Morgan  County  •  .  .  

do 

2  05 

2  30 

1  80 

The  Bailey  Run  or  No  7  seam 

do 

2  45 

2  70 

2  20 

District  No.  4:  Washington  and  Noble  Counties,  Mor- 
gan County  except  Homer  Township,  and  Perry 
County  except  Coal  and  Monroe  Townships  

do 

2  45 

2  70 

2  20 

District  No.  5:  Muskingum  County  

do 

2  20 

2  45 

1  95 

District  No.  6:  Holmes,  Tuscarawas,  Carroll,  and  Cos- 
hocton  Counties,  Monroe,  Franklin,  Washington, 
and  Freeport  in  Harrison  County,  and  Washington 
and  Yellow  Creek  Townships  in  Columbiana  County, 
and  Brush  Creek,  Saline,  Springfield,  Ross,and  Knox 
Townships  in  Jefferson  County,  and  operations  in 
the  8-A  vein  in  Flushing  and  Union  Townships  in 
Belmont  Count  v  

do 

2  45 

% 
2  70 

2  20 

District  No.  7  .  .                          

do 

2  95 

3  20 

2  SO 

District  No.  8:  Monroe  County  and  Belmont  Count}7, 
except  Warren  Township  and  operations  in  the  8-A 
vein  in  Flushing  and  Union  Townships,  Harrison 
County  except  Monroe,  Franklin,  Washington,  and 
Freeport  Townships,  and  Jefferson  County  except 
Brush  Creek,  Saline,  Ross,  Knox,  and  Springfield 
Townships  

do 

1  90 

2  15 

1  90 

District  No.  9:  Guernsey  County  and  Warren  Town- 
ship in  Belmont  County  

do 

2  05 

2  30 

1  80 

Wayne  Mining  Co.  ,  Guernsey  County  

do 

2  50 

*?  75 

2  25 

Southern  Ohio  Coal  Co.,  Starr  Township,  Hocking 
County 

Oct       8  1918 

2  95 

3  20 

2  80 

Wheeling  and  Liberty  Townships  in  Guernsey  County 
(transferred  from  district  No.  9  and  district  No.  6)  
Oklahoma: 
Le  Flore  and  Haskell  Counties 

Nov.  19,1918 
Oct       1  1917 

2.20 
3  50 

2.45 
4  30 

1.95 
2  25 

Ocmulgee  and  Tulsa  Counites  

do 

3  10 

3  90 

2  00 

Coal  County 

do 

3  30 

10 

2  00 

Pittsburg  and  Latimer  Counties  

do 

3  50 

30 

2  25 

Le  Flore  and  Haskell  Counties  (conditional) 

Nov   30  19>7 

3  75 

55 

2  50 

Okmulgee  and  Tulsa  Counties  (conditional)  

do  . 

3  35 

15 

2  25 

Coal  County  (conditional)  

do 

3  55 

35 

2  25 

Pittsburg  and  Latimer  Counties  (conditional) 

do 

3  75 

4  55 

2  50 

Le  Flore,  Haskell,  Okmulgee,  Tulsa,  Rogers,  and  Coal 
Counties,  andthellartshorn-Wilburton  vein  in  Pitts- 
burg and  Latimer  Counties  .  .  . 

Mar    29  1918 

3  70 

4  60 

2  40 

Me  Alester  vein  in  Pittsburg  and  Latimer  Counties  .  • 

do  ' 

4  25 

5  10 

3  00 

Pennsylvania: 
O'DonnellBros.,  at  Morris  Run,  Tioga  County  (condi- 
tional) 

Dec      8  1917 

2  25 

2  50 

2  00 

Ajax  Hocking  Coal  Co.,  in  Clearfield  and  Somerset 
Counties  (publication  No.  2  and  special  order)  

Nov.  13,1917 

2.75 

Operations  in  the  counties  of  Tioga,  Lycoming,  Clinton, 
Center,  Huntingdon,  Bedford,  Cameron,  Elk,  Clear- 
field,  Cambria,  Blair,  Somerset,  Jefferson,  Indiana, 
Clarion,  Armstrong,  Butler,  Mercer,  Lawrence,  and 
Beaver,  and  operations  in  Allegheny  County  from 
the  lower  end  of  Tarentum  Borough  north  to  the 
county  line,  and  in  Westmoreland  County  from  a 
point  opposite  the  lower  end  of  Tarentum  Borough 
north  along  the  Allegheny  River  to  the  Kiskiminitas 
River,  and  along  the  Kiskiminitas  River  eastward  to 
the  Conemaugh  River,  and  continuing  along  the 
Conemaugh  River,  to  the  county  line  of  Cambria 
County 

Feb     16  1918 

2  60 

2  60 

2  60 

Operations  on  the  Baltimore  &  Ohio  R.  R.  from  the 
Somerset  County  line  to  and  including  Indian  Creek 
and  the  Indian  Creek  Valley  branch  of  the  Baltimore 
&  Ohio  R.  R.  .  . 

Mar.   14.  1918 

2.60 

2.60 

2.60 

650 


HISTORY    OF   PRICES    DURING   THE   WAR. 


MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATES  FUEL 
ADMINISTRATOR-Continued. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared 
sizes. 

Slack  or 
screen- 
ings. 

Pennsylvania—  Continued  . 
Pittsburgh  field,  including  the  counties  of  Washington, 
Greene,  Fayette,  Westmoreland,  and  Allegheny, 
except  (1)  that  portion  of  ADegheny  County  froin 
the  lower  end  of  Tarentum  Borough  north  to  the 
county  line;    (2)  the  territory  in  Westmoreland 
County  from  a  point  opposite  the  lower  end  of  Taren- 
tum Borough  north  along  the  Allegheny  River  to  the 
Kiskiminitas  River  and  along  the  'Kiskiminitas 
River  eastward  to  the  Conemaugh  River  and  con- 
tinuing along  the  Conemaugh  River  to  the  count  v 
line  of  Cambria  County;  (3)  operations  on  Indian 
Creek  in  Westmoreland  County;  and  (4)  operations 
in  the  Ohio  Pyle  district  of  Fayette  County  
Coal  mined   by  the  Fall  Brook  Coal  Co.  "in  Tioga 
County  

Mar.   23,1918 
June  14  1918 

$2.00 
2  50 

$2.25 
2  go 

$1.75 
2  30 

The  counties  of  Allegheny,  Westmoreland,  Favette, 
Greene,  and  Washington,  except  (1)  that  portion  of 
Allegheny  County  from  the  lower  end  of  Taren- 
tum Borough  north  to  the  county  line;  (2)  the  ter- 
ritory in  Westmoreland  County  from  a  point  oppo- 
site the  lower  end  of  Tarentum  Borough  north  along 
the  Allegheny  River  to  the  Kiskiminitas  River  and 
along  the  Kiskhninitas  River  eastward  to  the  Con- 
emaugh River  and  continuing  along  the  Conemaugh 
River  to  the  county  line  of  Cambria  County;  (3)  op- 
erations on  Indian  Creek  in  Westmoreland  Countv; 
and  (4)  operations  in  the  Ohio  Pyle  district  of  Fay- 

June  29  1918 

1  90 

2  15 

1  90 

Coal  produced  at  the  stripping  operation  of  the  Graff 
Mining  Co.  in  Westmoreland  Countv  (wage  increase 
not  to  be  added) 

Oct       1  1918 

2  95 

2  95 

2  95 

Wilson  Begler  Coal  Co  ,  Beaver  County 

Nov    19'  1918 

2  95 

3  20 

2  80 

Tennessee  (eastern): 
Counties  of  Scott,  Claiborne,  Anderson,  Morgan,  and 
Campbell    . 

Oct     11  1917 

2  40 

2,  65 

2  15 

Blue  Gem  district,  Campbell  County 

Nov     4'  1917 

3  55 

3  80 

2  "ft 

Counties  of  Claiborne,  Morgan,  Anderson,  Scott,  and 
Campbell,  other  than  the  Blue  Gem  (conditional).  .  . 
Bledsoe,  Marion,  Grundv,  and  White  Counties 

Dec.     3,  1917 
Dec      8  1917 

2.65 
2  40 

2.  90 
2  65 

2.40 
2  15 

Cumberland  County  .       .  . 

Jan     12  1918 

2  40 

2  65 

2  15 

All  except  Overton  and  Fentress  Counties  

Apr      5,  1918 

2  65 

2  90 

2  40 

Overton  and  Fentress  Counties 

do 

2  20 

2  45 

1  95 

Blue  Gem  coalproduced  in  Campbell  County  by  opera- 
tors who  are  members  of  the  Tri-County  Blue  Gem 
Coal  Operators  '  Association  

Mav      1  1918 

3  55 

3  80 

2  40 

Bon  Air  Coal  &  Iron  Corporation  in  the  Bon  Air  mine, 
in  White  Countv  

June  19  1918 

3  45 

3  70 

2  30 

T.  M.  Morrison  Coal  Corporation  and  the  Lone  Moun- 
tain Coal  Corporation  at  Pennington  Gap  in  Lee 
County  

do 

2  55 

2  80 

2  30 

White  Oak  Coal  Co.  ,  Fentress  County  .  .  . 
Sterling  Coal  &  Coke  Co.,  Reliance  Coal  &  Coke  Co., 
Brysan  Mountain  Coal  &  Coke  Co.  ,  Climax  Coal  Co.  , 
Mingo  Coal  &  Coke  Co.  ,  and  Fork  Ridge  Coal  &  Coke 
Co.,  in  Claiborne  Countv  

Sept.  14,  1918 
1  Oct     28,  1918 

2.55 
2  60 

2.80 

2  85 

2.30 
2.30 

Coal  mined  in  Campbell  Countv  by  members  of  the 
Tri-County  Blue  Gem  Operators  '  Association 

Oct     29,  1918 

2  55 

3.70 

2  30 

Nut  and  slack  through  ij-inch  bars  $2.55 
Texas: 
Operators  at  Thurber  and  Strawn.  . 

Dec.     7,  1918 
Nov.  14  1917 

3.30 
3  60 

4.05 
4  40 

2.30 
2.25 

Operators  at  Bridgeport 

do 

4  25 

5  06 

2  25 

Counties  of  Young,  Erath,  and  Palo  Pinto 

Nov    16.1917 

3  go 

4  40 

2  25 

Wise  County  

do 

4  25 

5  05 

2  25 

Lignite  coal  

Mar.     5  1918 

1  40 

.85 

Screened,  at  least  15  per  cent  screenings  out,  $1.50. 
Lignite  coal  

June  22  1918 

1  55 

1  75 

1.00 

All  Texas  bituminous  coal,  except  counties  of  Erath, 
Palo  Alto,  and  Young  

do 

4  25 

5  05 

2:25 

Counties  of  Erath,  Palo  Pinto,  and  Young 

do 

3  40 

4  20 

2  25 

Do  

Aug   16  1918 

3  40 

4  55 

2.25 

Wise  County.  .  . 

Sept     4  1918 

4  25 

5  40 

2  25 

Utah  

Mar.  11,1918 

2.65 

3.30 

1.50 

Virginia: 
Mines  operated  near  St.  Charles,  Lee  County,  by  the 
Darby  Coal  Mining  Co..  Black  Mountain  Mining  Co., 
Virginia  Lee  Co.,  Old  Virginia  Coal  Co.,  United  Col- 
lieries Co.  (Inc.),  Benedict  Coal  Corporation,  and  the 
Imperial  mine  of  the  Virginia  Iron,  Coal  &  Coke  Co., 
Roanoke  

[Oct.    11,1917 

2.40 

2.65 

2.15 

\Apr.  20,1918 

2.65 

2.90 

2.40 

Announced  Jan.  2,  1918. 


GOVERNMENT   REGULATIONS    RELATING   TO   PRICES. 


651 


MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATES  FUEI. 
ADMINISTRATOR— Continued. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared 
sizes. 

Slack  or 
screen- 
ings. 

Virginia—  Continued. 
Imperial  mine  of  the  Virginia  Iron,  Coal  &  Coke  Co.,  of 
Roanoke 

Oct    27  1917 

32  40 

|2  65 

$2  15 

Richmond  Basin,  Chesterfield  and  Henrico  Counties.  .  . 
Extreme  northern  part  of  Buchanan  County  
Clinch  Valley  No.  1  district  or  "Upper  Clinch";  coal 
mining  operations  on  the  Norfolk  &  Western  Ry., 
Hockman  to  Finnev,  inclusive  .  .                 .  . 

Jan.    21,1918 
Feb.     7,  1918 

Feb    28  1918 

3.30 
2.40 

2.50 

3.55 
2.65 

2.75 

3.05 
2.15 

2  25 

Lee,  Wise,  Dickinson  Counties,  and  Russell  County 
west  of  Finney,  on  the  Norfolk  &  Western  Ry  
Pocahontas  district:  Operations  on  the  Norfolk  & 
Western  Rv.  and  branches  west  of  Graham,  Va.,  to 
Welch,  W.'Va..  including  Newhall,  Berwind,  Cane- 
brake,  Hartwell,  and  Beoch  Fork  branches;  opera- 
tions on  the  Virginian  Railroad  and  branches,  west 
of  Rock  to  Herndon,  W.  Va.  (confirmation  of  Presi- 
dent's prices) 

Apr.     5,  1918 
Mar    21  1918 

2.20 
2.00 

2.45 
2.25 

1.95 
1.75 

Darby  Coal  Mining  Co.  ,  \7irginia  Lee  Co.,  Old  Virginia 
Coal  Co.,  United  Collieries  Co.  (Inc.),  Benedict  Coal 
Corporation,  Imperial  mine  of  the  Virginia  Iron, 
Coal  &  Coke  Co  Ronnoke 

\t>r    26  1918 

2  65 

2  90 

2  40 

Mines  operated  near  St.  Charles,  Lee  County,  by  the 
Cumberland  Coal  Co.,  the  Penn  Lee  Coal  Co.,  the 
Lecova  Coal  Co.  ,  and  the  Wilma  Coal  Co  .... 

May   24  1918 

2.65 

2.90 

2.40 

Pocahontas  district  (as  described  in  the  order  of  the 
United  States  Fuel  Administrator,  dated  Mar.  21, 
1918)  ... 

June    1  1918 

0) 

Lee  County:  Mohawk  Coal  Mining  Co.,  Keokee; 
Powell  River  Coal  Co.,  Purcell;  North  ForkCoaiCo., 
Pennington  Gap 

Aug.  20  1918 

2.55 

2.80 

2.30 

Splash  Dam  Coal  Corporation,  and  McClure  Coal 
Corporation,  in  Dickinson  County  .... 

Aug.  19  1918 

2.40 

2.65 

2.15 

T.  M.  Morrison  Coal  Corporation,  Lone  Mountain  Coal 
Corporation,  at  Pennington  Gap  in  Lee  County  

do  

2.55 

2.80 

2.30 

Black   Mountain    Mining   Co.,    Benedict   Coal  Co., 
Bondurant  Coal  Co.,  Darby  Coal  Co.,  United  Col- 
lieries Co.,  and  Old  Virginia  Coal  Co.,  in  Lee  County. 
Clinchfield  Coal  Corporation,  Camper  Coal  Co.,  Kil- 
gore  Coal  Co.,  Stonegap  Colliery  Co.,  J.  A.  Esser 
Coke  Co.,  Yellow  Creek  Coal  &  Coke  Co.,  Gladeville 
Coal  Co.,  Wise  Coal  &  Coke  Co.,  Norton  Coal  Co., 
Blackwood  Coal  &  Coke  Co.,  and  Stonega  Coal  Co.. 
in  Wise  County,  and  Stonega  Coal  Co.,  at  Keokee 
mine  in  Lee  County 

Oct.    28,1918 
do 

2.60 
2  15 

2.85 
2.40 

2.30 
1  85 

Roberts  Coal  Co.  ,  in  Wise  County  .  

do  

2.60 

2.85 

2.30 

Robert  Fleming  &  Co.,  of  Norton;  Hawthorne  Co.,  of 
Norton;  John  B  .  Guernsey  &  Co.  ,  of  Tacoma  
Emerald  Coal  Co.,  Obey  Branch  Coal  Co.,  Pucketts 
Creek  Coal  Co    in  Lee  County 

Nov.  19,1918 
Dec      7  1918 

2.15 
2.55 

2.40 
2.80 

1.85 
2.30 

Bradley  Coal  Co.,  White  Oak  Coal  Co.,  Hawthorne 
Coal  Co.  ,  Felton  Coal  Mining  Co.  ,  in  Wise  County  .  .  . 
Stone  Gap  Colliery  Co.,  Norton  Coai  Co.,  J.  A.  Esser 
Coal  Co    Kilgore  Coal  Co.,  in  Wise  County 

do  
do.. 

2.55 
2.  CO 

2.80 
2.85 

2.30 
2.30 

District  No.  1:  Operations  not  classified  under  other 
districts  or  covered  by  the  proviso  hereinafter  set 
forth  

Dec.    16,1918 

1.90 

2.15 

1.65 

District  No.  2:  Operations  in  the  Richmond  Basin 
within  Chesterfield  and  Henrico  Counties 

do 

3.20 

3.45 

2.95 

District  No.  3:  Clinch  Valley  No.  1  district  or  "  Upper 
Clinch,"  being  coal-mining  ope  rations  on  the  Norfolk 
&  Western  Ry  .  from  Hockman  to  Finney  ,  inclusive  .  . 
District  No.  4:  That  portion  of  the  Pocahontas  district 
located  in  the  State  of  Virginia..,  said  Pocahontas  dis- 
trict being  more  particularly  described  as  comprising 
operations  on  the  Norfolk  &  Western  Ry.  west  of 
Graham,  Va.,  to  Welch,  W.  Va.,  also  including  oper- 
ations on  the  Virginian  Ry.  and  branches  west  of 
Rock  to  Herndon  W.  Va 

do  
do  

2-40 
1.90 

2.65 
2.15 

2.15 
1.65 

District  No.  5:  Lee,  Wise,  and  Dickenson  Counties  and 
Russel  County  west  of  Finney  on  the  Norfolk  & 
Western  Ry 

do 

2.10 

2.35 

1.85 

District  No.  6:  That  portion  of  the  Thacker  district 
located  in  Virginia,  being  operations  in  the  extreme 
northern  portion  of  Buchanan  County  .  .  . 

do.. 

2.20 

2.45 

1.95 

Providing  that  the  following  prices  shall  apply  to  the 
operations  and  operators  hereinafter  mentioned: 

1  Where  slack  or  screenings  passing  through  the  accepted  standard  screens  customarily  used  prior  to 
Jan.  1 , 1916,  constituted  not  less  than  55  per  cent  of  the  mine-run  output  of  anv  mine,  such  slack  or  screen- 
ings may  be  sold  at  the  run-of-mine  price  applicable  at  said  mine  at  date  of  shipment. 


652 


HISTORY   OF   PRICES   DURING   THE   WAR. 


MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATES  FUEL 
ADMINISTRATOR— Continued. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared    ^  ™ 

si*es'    |     ings 

Virginia—  Continued. 
Operations  of  Splash  Dam  Coal  Corporation  and  Mc- 
Clure  Coal  Corporation  in  Dickenson  County  
Operations  of  Cumberland  Coal  Co.,  Penn  Lee  Coal 
Co.,  Leecova  Coal  Co.,  Wilma  Coal  Co.,  Virginia  Lee 
Co.,  Emerald  Coal  Co.,  Obey  Branch  Coal  Co.,  Puck- 
etts  Creek  Coal  Co.,  Mohawk  Coal  Mining  Co.,  Pow- 
ell River  Coal  Co.,  North  Fork  Coal  Co.,  T.  M.  Mor- 
rison Coal  Corporation,  Lone  Mountain  Coal  Corpo- 
ration, and  Imperial  mine  of  the  Virginia  Iron,  Coal 
&  Coke  Co  ,  of  Roanoke  in  Lee  County 

Dec.  16,1918 
do 

$2.40 

2.55 
2.60 

2.15 
2.55 

2.60 
3.25 

3.55 

$2.65 

2.80 
2.85 

2.40 
2.80 

2.85 
4.50 

$2.15 

2.30 
2.30 

1.85 
2.30 

2.30 
3.00 

2.50 

Operations  of  Black  Mountain  Mining  Co.,  Benedict 
Coal  Co.,  Bondurant  Coal  Co..  Darby  Coal  Co.. 
United  Collieries  Co.  (Inc.),  W  Old  Virginia  Coal 
Co    near  St  Charles  Lee  County                .      .  . 

do  ... 

Operations  of  Stonega  Coal  &  Coke  Co.  at  Keokee,  Lee 
County;  Clinchfield  Coal  Corporation  Camper  Coal 
Co.,  Yellow  Creek  Coal  &  Coke  Co.,  Blackwood  Coal 
&  Coke  Co.,  Stonega  Coal  &  Coke  Co.,  Robert  Flem- 
ing &  Co.,  and  John  B.  Guernsey  &  Co.,  in  Wise 
County                                                           

do 

Operations  of  Bradley  Coal  Co.,  White  Oak  Coal  Co., 
and  Felton  Coal  Mining  Co    in  Wise  County     

do     ... 

Operations  of  Roberts  Coal  Co.,  Stone  Gap  Colliery  Co., 
Norton  Coal  Co..  Hawthorne  Coal  Co.,  J.  A.  Esser 
Coke  Co.,  and  Kilgore  Coal  Co.,  in  Wise  County  
Washington:  1 
Pierce  and  King  Counties 

do  

Oct.     1,  1917 

Mar.  29,  1918 

Screened  coals- 
Bituminous— 
Kittitas  County 

Lump  and  egg 

3.95 
3.25 

Semibituminous— 

Mar.  29,  1918 

2.75 

1.25 

Lump 

3.95 
3.25 
3.00 

4.00 

Lump  nut 

Nut 

Washed  coals- 
Bituminous— 
Kittitas  County                                   

Mar.  29,  1918 

Pierce  King  Lewis    and  Skagit  Counties. 

.do  

2.50 

Lump  nut 

6.00 
5.25 
4.80 

Mixed  steam 



Straight  steam  and  gas 

Sub-bituminous  — 
King  County.  .                                     

Mar.  29,  1918 

1.50 

Lump  nut 

5.00 
3.50 

Pea            •  

Buckwheat 

3.25 

Lewis  County.                                

Mar.  29,  1918 

1.25 

Lump 

3.95 
3.75 

Nut 

Mar  29  1918 

Pea 

3.00 
1.50 

Buckwheat 

West  Virginia: 
Ajax  Hocking  Coal  Co.,  in  Mineral  County  (Publica- 
tions 2  4E   and  special  order) 

Nov.  13,  1917 
Nov.  22,  1917 
Nov.  28,  1917 

Feb.     1,  1918 
Feb.    7,  1918 

Feb.  28,  1918 
do  .  . 

2.75 
2  75 

2.  35 
2.40 

2.40 

2.40 
2.40 
2.40 

2.00 

Dayy-Pocahontas  Coal  Co    in  McDowell  County 

Pomeroy  field 

2.60 
2.65 

2.  65 

2.65 
2.65 
2.65 

2.25 

2.10 
2.15 

2.15 

2.15 
2.15 
2.15 

1.75 

Mineral,  Grant,  Tucker  Counties  and  the  extreme 
eastern  and  southeastern  portion  of  Preston  County  . 
Kenova  and  Thacker  fields  in  Mingo  County,  the  ex- 
treme southern  part  of  Wayne  County,  andtheex- 
treme  northwestern  part  of  McDowell  "County 

Tug  River  district:  Coal-mining  operations   on  the 
Norfolk  &  Western  Ry.,  west  of  Welch  to  Panther, 
including  branches,  except  Newhall,  Berwind,  Cane- 
brake  and  Hartwell 

Preston  County,  being  part  of  the  upper  Potomac, 
Cumberland    and  Piedmont  fields 

Wayne  County,  being  part  of  the  Ken  ova  and  Thacker 
fields 

Mar.    5,  1918 
Mar.  21.  191S 

Pocahontas   district:  Operations  on   the  Norfolk  & 
Western  Ry.,  and  branches  west  of  Graham,  Va., 
to  Welch,  W.  Va..  including  Newhall,  Berwind, 
Canebrake,  Hartwell,  and  Beech  Fork  branches; 
also   operations   on  the   Virginian   Railroad   and 
branches,    west    of   Rock    to    Herndon,    W.    Va. 
(  President's  prices)  

1  Preparations  of  coal  mined  in  the  State  of  Washington  must  conform  to  reports  submitted  to  and 
approved  by  the  State  rnine.price  board. 

GOVERNMENT   REGULATIONS   RELATING  TO   PRICES. 


653 


MODIFICATIONS  TO  THE  PRESIDENT'S  PRICES  MADE  BY  THE  UNITED  STATES  FUEL 
ADMINISTRATOR— Continued. 


District. 

Date  when 
effective. 

Run  of 
mine. 

Prepared 
sizes. 

Slack  or 
screen- 
ings. 

West  Virginia—  Continued. 
No.  8  or  Pittsburgh  seam,  in  Hancock,  Brook,  Ohio 
and  Marshall  Counties    .                            ... 

Mar    23  1918 

$2  00 

$2  25 

$1  75 

No.  10  district;  Coal  and  coke  and  Gauley  Districts; 
Taylor,  Barbour,  Lewis,  Buckhannon,  Randolph, 
Gilner.  Braxton,  Webster,  and  Greenbrier  Counties; 
operations  in  Nicholas  County  east  of  the  mouth  of 
the  Meadow  Branch  of  the  Gauley  River,  and  the 
coal  and  coke  district  in  Kanawha  and  Clay  Counties 
north  of  Charleston 

Apr    20  1918 

2  30 

2  55 

2  05 

Fairmont  district;  Monongalia,  Marion,  and  Harrison 
Counties  

do 

2.15 

2  40 

1  90 

Thacker  District:  Operations  in  McDowell  County, 
west  of  Panther  on  the  Norfolk  &  Western  Rv.  and 
in  Mingo  County  west  along  the  Tug  Fork  of  the  Big 
Sandy  River  to  Williamson  on  the  Norfolk  &  West- 
ern Ry  

do.... 

2.30 

2.55 

2  05 

New  River  district:  Fayette  County  south  of  Hawk's 
Nest  on  the  Chesapeake  &  Ohio  R.  R.,  and  Fayette 
and  Raleigh  Counties  south  of  Paintsville  on  the 
Virginian  R.  R.,  and  Wyoming  County  north  of 
Herndon  on  the  Virginian  R  R 

do 

2  35 

2  60 

2  10 

Logan  district:  Logan  County  and  operations  in 
Boone  County  south  of  Danville  on  the  Chesapeake 
&  Ohio  R.  R.,  and  Lincoln  County  south  of  Gill  on 
the  Chesapeake  &  Ohio  R.  R  

do     . 

2.15 

2  40 

1  90 

Putnam  County 

do 

2  .50 

2  75 

2  25 

Kenova  District:  Operations  on  the  watershed  of  the 
Tug  Fork  of  the  Big  Sandy  River  west  of  William- 
son on  the  Norfolk  &  Western  Ry.  and  Wayne 
County  

do.... 

2.30 

2.55 

2.05 

Kanawha  district:  Nicholas  County  west  of  the  mouth 
of  the  Meadow  Branch  of  the  Gauley  River;  Fayette 
County  west  of  Hawk's  Nest  on  the  Chesapeake  & 
Ohio  R.  R.,  and  north  of  Paintsville  on  the  Vir- 
ginian R.  R.,  and  operations  in  Raleigh  and  Boone 
Counties  on  the  watershed  of  the  Clear  Fork  Branch 
of  Coal  River,  Boone  County,  north  of  Danville  on 
the  Chesapeake  &  Ohio  R.  R.;  Kanawha  County 
south  of  Charleston  and  Lincoln  County  north  of  Gill 
on  the  Chesapeake  &  Ohio  R.  R... 

do     . 

2.25 

2  50 

2  00 

Mines  operated  near  Richmond,  Nicholas  County  by 
the  Saxman  Coal  &  Coke  Co  

May   24,1918 

2.80 

3.05 

2.55 

Pocahontas  district:  New  River  district,  Tug  River 
district  (as  described  in  the  order  of  the  United 
States  Fuel  Administrator,  Mar.  21,  1918)  

June     1,  1918 

(i) 

Mason  County.  . 

June  29,1918 

2  35 

2  60 

2  10 

Do  

Aug.  29,  1918 

2.30 

2.55 

2.05 

Hancock,  Brook,  Ohio,  and  Marshall  Counties  

June  29.  1918 

1.90 

2.15 

1.90 

Three  Forks  Coal  Co.,  in  the  New  River  district 

Dec.     7,  1918 

2.55 

2.55 

2.00 

Wyoming 

Oct  '    1  1917 

2  50 

3  50 

1  25 

Do  

Mar    11,1918 

2.65 

3.30 

1.50 

Sub-bituminous  — 
Egg  run 

Mar    23  1918 

2  15 

Nut  run  

do  

2.00 

1  Where  slack  or  screenings  passing  through  the  accepted  standard  screens  customarily  used  prior  to 
Jan.  1,  1916,  constituted  not  less  than  55  per  cent  of  the  mine  run  output  of  any  mine,  such  slack  or  screen- 
ings may  be  sold  at  the  run-of-mine  price  applicable  at  said  mine  at  date  of  shipment. 


REVISION    OF   DESCRIPTION    OP   CERTAIN    DISTRICTS   IN    WEST    VIRGINIA   AS    CONTAINED    IN    PRICE 
ORDER   OP  APRIL  19,   1918,   ANNOUNCED  JUNE   27,    1918. 

New  River  district :  County  of  Fayette  east  of  the  Ganley  River  to  Hawks  Nest  on  the 
Chesapeake  &  Ohio  Railroad,  and  east  of  a  line  drawn  from  Hawks  Nest  to  Roseville  on 
the  Virginian  Railroad,  and  the  counties  of  Fayette  and  Raleigh,  south  of  Roseville,  and 
the  county  of  Wyoming  north  of  Herndon  on  the  Virginian  Railroad. 

Kanawha  district :  County  of  Nicholas  west  of  the  mouth  of  the  Meadow  Branch  of 
the  Ganley  River,  the  county  of  Fayette  west  of  the  Ganley  River  and  north  of  the 
Kanawha  and  west  of  a  line  drawn  from  Hawks  Nest  on  the  Chesapeake  &  Ohio  Rail- 
road to  Roseville  on  the  Virginian  Railroad  and  operations  in  the  counties  of  Raleigh 
and  Boone  on  the  watershed  of  the  Clear  Fork  Branch  of  Coal  River,  and  the  county  of 
Boone  north  of  Danville  on  the  Chesapeake  &  Ohio  Railroad,  and  the  counties  of  Kanawha 
and  Clay  south  of  Charleston  and  the  county  of  Lincoln  north  of  Gill  on  the  Chesapeake 
&  Ohio  Railroad. 


654 


HISTORY    OF   PRICES   DURING   THE    WAR. 


District. 


Lump. 


Coal  at  docks  on  Lake  Michigan  or  Lake  Superior: 
From  Oct.  30, 1917,  to  Apr.  30, 1918— 

Youghiogheny,  Fairmont,  Greensburg,  and  Westmoreland  County 

fields ;. 

No.  8  seam,  eastern  Ohio  fields 

Hocking  and  Pomeroy,  Ohio,  fields 

West  Virginia  splint  and  block  fields 

Kentucky  gas  and  steam  and  splint  and  block  fields 1 

Smokeless  coal  fields ! 

From  June  1, 1918,  to  Apr.  30, 1919— 

Youghiogheny,  Fairmont,  Greensburg,  Westmoreland  No.  8  seam, 

Ohio  and  Hocking,  and  Pomeroy  fields 

Harlan,  Thacker,  Kenova,  and  Kanawha  fields 

Pocahontas,  New  River,  and  Tug  River  fields 

From  Sept.  26, 1918,  to  Apr.  30, 1919— 

Southwestern  district  in  Pennsylvania,  Fairmont  and  Panhandle 

districts  in  West  Virginia,  and  districts  3, 8,  and  9  in  Ohio 

Harlan,  Thacker,  and  Kenova  districts  in  Kentucky;  Thacker, 
Kenova,  Kanawha,  Mason  County  districts  in  West  Virginia; 

districts  Nos.  1,  2,  4,  5,  6,  and  7  in  Ohio 

Pocahontas,  New  River,  and  Tug  districts  in  West  Virginia 


$6.60 
6.40 
6.60 
6.85 
7.20 

'7.70 


Run  of 
pile. 


5.80 
6.30 
6.30 


5.80 


$6.  40 
6.20 
6.40 
6,65 
7.00 
6.55 


5.55 
6.05 
6.05 


5.55 


6.05 
6.05 


Screen- 
ings. 


?6.20 
6.10 
6.20 
6.55 
6.55 
6.55 


5.30 

5.80 
6.05 


5.30 


5.80 
6.05 


1  Lump  and  egg. 

Above  prices  are  based  on  freight  rates  between  mines  and  Lake  Erie  ports,  effective  June  1   1918 
By  order  of  November  20, 1918,  the  sum  of  $1.05  per  gross  ton  was  added  to  these  prices. 

Cannel  coal. — On  June  28,  1918,  prices  of  cannel  coal  were  fixed  as  for  those 
of  bituminous  coal  at  the  mine  where  the  coal  was  produced,  except  that  if  the 
producer  held  a  permit  he  might  sell  lump  cannel  coal  at  not  to  exceed  $1  per 
net  ton  over  the  price  for  run-of-mine  bituminous  at  the  mine  where  such  coal 
was  produced. 

Mixture  of  cannel  and  bituminous  coal. — On  February  26,  1918,  the  following 
ruling  was  announced :  "  Where  cannel  and  bituminous  coals  are  mixed  the 
maximum  price  for  the  mixture  shall  be  the  mine  price  for  the  bituminous 
coal  in  such  mixture." 

On  July  16,  1918,  regulations  became  effective  as  follows : 

SECTION  1.  The  prices  of  cannel  coal  shipped  on  and  after  the  effective  date 
of  this  regulation  are  hereby  fixed  f.  o.  b.  cars  at  the  mine  per  net  ton  at  not  to 
exceed  the  applicable  Government  mine  price  for  bituminous  coal  at  the  mine 
where  such  cannel  coal  is  produced :  Provided,  however.  That  if  the  producer  of 
such  cannel  coal  shall  obtain  from  the  United  States  Fuel  Administrator  a 
permit  therefor  lump  cannel  coal  may  be  sold  for  a  sum  not  to  exceed  $1  per 
net  ton  above  the  applicable  Government  mine  price  for  run-of-mine  bituminous 
coal  at  the  mine  where  such  coal  is  produced. 

SEC.  3.  When  cannel  coal  is  loaded  into  box  cars  a  charge  of  50  cents  per 
net  ton  in  addition  to  the  prices  fixed  in  section  1  hereof  may  be  made  to  cover 
the  cost  of  labor  and  material  necessary  to  load  such  coal  into  box  cars.  No 
such  charge  shall  be  made  on  shipments  in  box  cars  of  cannel  coal  mixed  with 
bituminous  coal. 

SEC.  4.  When  run-of-mine  or  prepared  cannel  coal  is  mixed  with  bituminous 
coal  of  any  size  the  mixture  shall  be  sold  at  a  price  not  to  exceed  the  Govern- 
ment mine  price  for  bituminous  screenings  applicable  at  date  of  shipment  at 
the  mine  where  such  cannel  coal  is  produced. 

SEC.  5.  When  cannel  coal  from  which  the  lumps  have  been  screened  is  mixed 
with  bituminous  coal  of  any  size  the  mixture  shall  bo  sold  at  a  price  not  to  ex- 
ceed the  Government  mine  price  for  bituminous  screenings  applicable  at  date  of 
shipment  at  the  mine  where  such  cannel  coal  is  produced  less  30  cents  per  net 
ton. 

Modified  mine-run  coal. — By  order  of  July  3,  1918,  effective  July  5,  1918,  maxi- 
mum prices  of  "  modified  mine-run  "  coal  were  to  be  the  Government  prices 
for  screenings  at  the  mine  where  such  coal  was  produced,  plus  the  following 
percentages  of  the  margin  or  difference  between  the  applicable  Government 
mine  prices  for  mine  run  and  screenings  at  such  mines,  viz : 

Run  of  mine  passed  through  2-inch  openings,  40  per  cent  of  such  margin. 

Run  of  mine  passed  through  3-inch  openings,  75  per  cent  of  such  margin. 


GOVERNMENT   REGULATIONS    RELATING   TO   PRICES.  655 


Run  of  iniue  parsed  through  4-inch  openings,  90  per  cent  of  such  margin. 
Run  of  mine  passed  through  5-inch  openings,  95  per  cent  of  such  margin. 
Run  of  mine  passed  through  6-inch  or  larger  openings  shall  take  the  appli- 
cable Government  price  for  the  run  of  mine. 

Sized  screening's.  —  An  order  fixing  the  prices  of  sized  screenings,  effective 
August  1,  1918,  was  as  follows  : 

1.  Special  sizes  —  passing  over  a  mesh  one-half  inch  in  size  and  over  the  appli- 
cable Government  mine  price  for  prepared  coal  at  the  mine  where  such  screen- 
ings were  produced. 

2.  Special   sizes  —  passing  over  a  mesh  over  one-fourth  inch  and  under  one- 
half  inch  in  size,  the  applicable  Government  mine  price  for  run-of-mine  coal 
at  the  mine  where  such  special  sizes  were  produced. 

3.  Fine  sizes  —  from  sized  coal  passing  through  mesh  one-half  inch  or  smaller 
in  size,  the  applicable  Government  mine  price  for  standard  screenings  at  the 
mine  where  such  fine  screenings  are  produced  less  30  cents  per  net  ton. 

4.  If  fine  screenings  or  "  carbon  "  passing  through  one-half  inch  or  smaller 
mesh  as  the  result  of  producing  special-sized  screenings  are  mixed  with  other 
coal   whether   the   same  be  mine  run,  prepared,   or   standard  screenings,  the 
selling  price  of  the  mixture  shall  not  exceed  the  applicable  Government  mine 
price  for  standard  screenings  at  the  mine  where  such  mixture  is  produced  less 
30  cents  per  net  ton. 

Smithing  coal.  —  Until  February  15,  1918,  smithing  coal  sold  at  the  prevailing 
market  prices.  After  that  date  it  sold  at  the  going  Government  price  for 
prepared  sizes  of  bituminous  coal  applicable  to  the  mine  producing  such  coal. 

On  April  25,  1918,  provisions  were  made  for  extra  charges  for  special 
preparation,  packing  in  bags,  or  loading  into  box  cars. 

By  order  effective  June  19,  1918,  crushed  run-of-mine  smithing  coal  produced 
by  the  Sequatchie  Coal  Co.  at  its  New  Etna  mines  in  Marion  County,  Tenn., 
was  to  be  sold  at  $3.80  per  net  ton  f.  o.  b.  cars  at  such  mines  plus  50  cents 
per  net  ton  if  loaded  in  box  cars  and  plus  the  actual  cost  of  bagging,  as 
provided  in  the  order  of  April  25,  1918. 

Export  and  bunker  coal.  —  Until  December  13,  1917,  the  prices  of  coal  as  fixed 
by  the  President  and  modified  by  the  Fuel  Administrator,  applied  to  export  and 
bunker  coal. 

Under  order  of  December  13,  1917,  the  maximum  price  of  such  coal  wus 
named  as  the  price  at  the  mine  at  the  time  such  coal  left  the  mine  plus  trans- 
portation charges  from  the  mine  to  port  of  lading  plus  $1.35  per  ton  of  2,000 
pounds.  To  this  price,  so  computed,  the  seller  of  the  coal  or  such  other  agency 
as  performed  the  actual  work  of  bunkering  or  loading  the  vessel,  could  add 
the  customary  charges  for  storage,  special  unloading  and  other  port  charges. 

On  February  25,  1918,  certain  revisions  were  made  in  the  previous  order  as 
follows  : 

1.  No  coal  can  be  invoiced  at  the  excess  price  provided  in  this  order,  except 
by  the  operator  or  dealer  who  actually  loads  it  into  foreign  vessels,  and  only 
after  the  coal  has  been  so  loaded. 

2.  After,  and  only  after,  such  excess  price  has  been  collected  in  accordance 
with  paragraph  1,  all  or  such  part  of  it  as  has  been  agreed  upon  beforehand 
may  be  paid  to  the  dealer  or  dealers  from  or  through  whom  the  coal  was  ob- 
tained, 

3.  In  setting  the  price  of  coal  for  foreign  bunkering  or  export  purposes,  no 
jobber's  margin  or  other  commission  in  addition  to  the  $1.35  per  ton  provided 
in  the  order  shall  be  added  to  the  price  of  the  coal. 

4.  The  phrase  "  deliver  to  vessels  for  foreign  bunkering  purposes,"  mentioned 
above,  is  hereby  held  to  mean  coal  put  in  the  bunkers  of  any  vessel  sailing 
from   a  tidewater  port  for  any  port  outside  the   United   States   and   Alaska, 
excepting  naval  vessels  or  Army  transports. 

5.  Coal  shipped  to  possessions  or  dependencies  of  the  United  States,  when 
consigned  to  any  department  of  the  United  States  Government,  shall  not  take 
the  excess  price  provided  by  this  order. 


656  HISTORY   OF   PRICES   DURING   THE   WAR. 

Coal  from  wagon  mines. — Under  date  of  October  6,  1917,  regulations  were 
issued  for  prices  of  coal  delivered  direct  to  the  consumer  from  the  mine  by 
wagon  or  truck: 

Coal  delivered  direct  to  the  consumer  from  the  mine  by  wagon  or  truck 
(whether  from  wagon  mines  or  other  mines)  shall  be  sold  at  not  more  than 
the  prices  fixed  by  the  President  and  the  Fuel  Administrator  plus  the  actual 
cost  of  hauling. 

Coal  bought  by  a  railroad  for  its  own  use  as  fuel  from  a  wagon-mine  hauling 
to  such  railroad  shall  be  sold  at  not  more  than  the  prices  fixed  by  the  President 
and  the  Fuel  Administrator  plus  the  actual  cost  of  hauling. 

No  charge  for  hauling  may  be  made  by  an  operator  of  a  wagon  mine  or  paid 
by  the  purchaser  of  the  coal  on  coal  shipped  by  rail,  except  where  such  ship- 
ment is  made  in  box  cars,  in  which  case  an  additional  charge  not  to  exceed  75 
cents  per  ton  may  be  made.  In  all  other  cases  the  price  of  wagon-mine  coal  on 
board  cars  shall  not  exceed  the  price  prescribed  by  the  President  and  the  Fuel 
Administrator  for  coal  at  the  mine. 

The  first  paragraph  of  the  above  ruling  was  amended  on  November  10,  1917,  to 
read  as  follows: 

Coal  sold  at  a  mine  to  be  delivered  direct  to  the  customer  by  wagon  or  truck 
may  be  sold  at  a  price  f.  o.  b.  mines  to  be  fixed  by  the  local  fuel  administration 
committee  in  the  community  in  \vhich  coal  is  delivered  for  consumption,  subject 
to  the  approval  of  the  State  fuel  administrator.  Such  local  committee  shall  also 
in  such  cases  fix  the  haulage  rates  to  be  charged  where  the  coal  is  delivered  by 
the  mine  operator. 

Specially  prepared  coal  and  coal  not  properly  picked  or  cleaned. — On  March 
11, 1918,  provision  was  made  for  the  sale  of  coal  not  conforming  to  requirements 
for  preparation: 

Inspectors  are  authorized  to  condemn  at  the  mines  any  coal  loaded  in  railroad 
cars  which,  in  their  judgment,  is  not  properly  prepared,  and  any  inspector  find- 
ing unmerchantable  coal  shall  immediately  notify  the  district  representative  and 
the  operator  by  wire  or  in  person  and  in  writing,  giving  the  car  numbers  and 
initials  of  any  and  all  cars  so  rejected  and  stating  the  facts  on  which  such  action 
was  based.  A  copy  of  such  notice  shall  be  immediately  mailed  to  the  United 
States  Fuel  Administration,  department  of  inspection,  and. to  the  district  repre- 
sentative. If  the  district  representative  approves  the  inspection  report,  he 
shall  so  notify  the  operator  at  once,  in  which  case,  unless  the  operator  unloads 
and  reprepares  the  rejected  coal,  the  consignee  shall  be  permitted  to  deduct  50 
cents  per  ton  from  the  authorized  price  for  the  grade  of  coal  with  which  the 
car  is  loaded :  Provided,  however,  The  consignee,  after  examining  the  coal  may, 
at  his  option,  pay  and  the  operator  may  receive  the  full  authorized  price. 

This  regulation  was  revoked  and  a  new  one  established  on  June  1,  1918 : 

If  any  such  inspector  shall  find  that  any  coal  is  about  to  be  shipped  which,  in 
his  opinion^  does  not  conform  to  the  requirements  of  section  1  hereof,  said  in- 
spector is  hereby  authorized  to  condemn  such  coal.  The  district  representative, 
if  he  approves  of  such  condemnation,  shall  immediately  give  notice  of  his  ap- 
proval to  the  operator  producing  such  coal,  confirming  such  notice  in  writing, 
and  thereupon  such  operator  shall  have  the  following  options: 

To  take  such  steps  as  may  be  necessary,  after  unloading  the  same,  if  in  railroad 
cars  or  barges,  to  make  the  same  conform  to  the  provisions  of  section  1  hereof  to 
the  satisfaction  of  the  inspector  condemning  the  same ;  or 

To  ship  such  coal  and  invoice  the  same  with  a  deduction  of  50  cents  per  net 
ton  from  the  applicable  Government  mine  price  or  from  the  contract  price  if 
such  coal  has  been  sold  under  contract  and  the  contract  price  differs  from  said 
Government  price. 

An  increased  price  was  allowed  for  specially  prepared  coal  in  a  regulation 
effective  April  1,  1918 : 

Picked,  spiralized,  and  washed  coal. — When  coal,  in  addition  to  being  screened 
into  sizes,  has  been  picked  upon  tables  or  loading  booms,  or  has  been  cleaned 
by  means  of  spiral  or  other  mechanical  separators  or  washers,  in  such  manner 
that  the  fuel  value  and  the  cost  of  preparation  are  substantially  increased  and 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES.  657 

the  total  output  substantially  decreased  through  removal  of  waste  and  impuri- 
ties, said  coal  may  be  sold,  but  only  for  shipment  loaded  on  board  cars  at  the 
mine  on  or  before  July  31,  1918,  at  an  increase  in  price  of  not  to  exceed  20  cents 
per  net  ton  above  the  applicable  Government  selling  price  at  the  date  of  ship- 
ment for  the  respective  grades,  denned  as  "  run  of  mine  "  and  "  prepared  sizes," 
that  are  actually  picked,  spiralized,  or  washed,  if  the  producer  thereof  has,  in 
the  manner  provided  in  Sections  III  and  IV  of  this  regulation,  obtained  a 
temporary  permit  for  making  such  additional  charge.  In  cases  where  the  above 
maximum  of  20  cents  is  not  sufficient,  in  the  opinion  of  the  United  States  Fuel 
Administrator,  to  compensate  for  this  work  a  special  temporary  permit  authoriz- 
ing a  larger  increase  to  such  amount  and  under  such  circumstances  as  the 
United  States  Fuel  Administrator  may  deem  proper,  may  in  the  discretion  of 
the  United  States  Fuel  Admintrator  be  issued  as  hereinafter  in  Sections  III  and 
IV  provided. 

This  order,  too,  was  revoked  and  a  new  one  became  effective  June  1,  1918. 

Mechanical  preparation. — No  special  allowance  will  be  made  for  the  ordinary 
method  of  cleaning  or  picking  coal  employed  in  any  district,  but  a  special  allow- 
ance \vill  be  made  for  coal  mechanically  washed  or  extraordinarily  cleaned  or 
picked  in  such  manner  that  the  fuel  value  of  the  coal  has  been  substantially  in- 
creased by  the  removal  of  waste  and  impurities. 

COKE. 

The  price  of  coke,  under  regulations  announced  November  9,  1917,  were  to  be 
understood  as  the  maximum  price  per  ton  of  2,000  pounds  f.  o.  b.  cars  at  the 
plant  where  it  was  manufactured. 

GENERAL  ORDERS  IN  REGARD  TO  COKE. 

APRIL   1,    1918. 

That  all  cases  of  sale  of  coke,  manufactured  east  of  the  94th  meridian,  to 
consumers  located  west  of  the  115th  meridian,  where  the  seller  assumes  the 
responsibility  for  the  quality  and  delivery  of  such  coke,  and  extends  credit  to, 
and  carries  the  account  of,  the  purchaser  in  accordance  with  the  usual  trade 
practices,  there  may  be  added  5  per  cent  to  the  established  price  of  the  coke 
f.  o.  b.  cars  at  the  point  of  manufacture. 

APBIL  26,    1918. 

(1)  The  maximum  price  of  coke  sold  and  delivered  for  export  to  foreign 
countries,  or  to  a  possession  or  dependency  of  the  United  States,  shall  be  the 
price  prescribed  for  such  coke  at  the  ovens  at  the  time  such  coke  left  the  ovens, 
plus  transportation  charges  from  the  ovens  to  the  port  of  loading,  plus  60  cents 
per  ton  of  2,000  pounds. 

(2)  To  this  price,  computed  as  above,  the  seller  of  the  coke  or  such  other 
agency  as  performs  the  actual  work  of  loading  the  vessel  may  add  the  cus- 
tomary and  proper  charges,  if  any,  for  unloading  from  railroad  cars  into  ships, 
for  towing,  elevation,  trimming,  railroad  and  ship  demurrage,  and  other  port 
charges. 

(3)  The  additional  60  cents  per  ton  of  2,000  pounds  herein  authorized  may 
not  be  added  to  the  price  of  coke  as  figured  above  where  the  coke  is  delivered 
solely  by  rail  to  foreign  countries. 

(4)  No  coke  shall  be  sold  and  delivered  for  export  to  foreign  countries,  or  to 
a  dependency  or  possession  of  the  United  States  by  ocean  transportation  before 
the  vendor  has  secured  a  permit  from  the  United  States  Fuel  Administration 
authorizing  the  sale.    Applications  for  such  permits  should  be  made  to  the  coke 
division  of  the  United  States  Fuel  Administration  and  should  contain,  first,  the 
name  of  the  consumer  and  the  destination  of  the  coke ;  second,  the  tonnage  to  be 
shipped. 

(5)  The  5  per  cent  provided  for  in  the  order  of  March  26,  1918,  for  coke 
manufactured  east  of  the  94th  meridian  and  delivered  to  customers  located  west 
of  the  115th  meridian,  may  be  added  to  the  established  price  for  all  coke  ex- 
ported from  the  Pacific  coast  in  addition  to  the  60  cents  allowed  in  this  order. 

Paragraph  4  of  this  order  was  revoked  on  December  19,  1918. 

125547°— 20 42 


658 


HISTORY   OF   PRICES    DURING   THE   WAR. 


Beehive  coke. — The  maximum  prices  for  various  grades  of  beehive  coke  made 
in  the  districts  west  of  the  Mississippi  River,  except  as  modified,  were  to  bear 
the  same  ratio  to  the  established  price  of  the  coal  from  which  the  coke  was 
made  as  the  average  contract  prices  of  the  same  grades  of  coke  had  to  the 
average  prices  of  coal  during  the  years  1912  and  1913. 

The  expression  "  72-hour  selected  foundry  coke "  was  to  cover  only  coke 
selected  in  accordance  with  the  usual  trade  practice  for  foundry  use,  and  the 
prices  named  for  72-hour  selected  foundry  coke  were  in  no  case  to  be  charged 
for  any  shipments  to  blast  furnaces  for  smelting  iron  or  other  metal. 

To  these  base  prices,  as  tabulated,  there  was  to  be  added  the  freight  rate 
from  the'  plant  where  the  competing  beehive  coke  was  produced,  except  that 
there  should  be  added,  in  addition,  for  coke  manufactured  in  New  England,  7 
cents  for  each  5  cents  above  60  cents  in  the  freight  rate  charges  per  ton  (2,240 
pounds)  of  coal  for  water  transportation  on  the  coal  used  in  the  manufacture 
of  such  coke. 


District. 

Date  when 
effective. 

48-hour 
blast 
furnace. 

72-hour 
selected 
foundry. 

Crushed 
over 
1-inch 
size. 

Beehive  coke  east  of  the  Mississippi  River,  base  prices.  .  .  . 

Modifications. 
Alabama: 
From  coal  mined  in  Black  Creek,  Brookwood,  and 
Blue  Creek  districts 

Nov.  10,1917 
Jan.    30,  1918 

86.00 

8  00 

$7.00 
8  00 

$7.30 

Manufactured  by  Empire  Coal  Co  at  Empire  

do.... 

8  25 

8  23 

do 

6  75 

6  73 

Coke  made  from  coal  mined  in  the  Big  Seam  district.  . 

Feb.  15.1918 

6.75 

6.75 

New  Castle  Coal  Co                                     

do 

7  50 

7  50 

United  States  Cast  Iron  Pipe  &  Foundry  Co  

do.... 

8  50 

8  50 

From  coal  mined  from  the  Nickel  Plate  seam  

Mar.  20  1918 

7  00 

7  00 

U.  S.  C.  S.  &  F.  Co.,  if  coke  is  made  from  Black  Creek 
coal 

Mar    30  1918 

8  7" 

Coke  made  from  coal  mined  from  the  Black  Creek, 
Blue  Creek  and  Brookwood  districts 

do 

8  00 

S  71 

Empire  Coal  Co  .                                               

Feb.   15  1918 

8  25 

8  25 



Coke  made  from  coal  mined  in  the  Nickle  Plate  district. 
Empire  Coal  Co.  at  Emp're 

Mar.  20,1918 
Apr    15  1918 

7.00 

7.00 
8  75 



Coke  made  at  the  plant  of  the  Newcastle  Coal  Co.,  at 
New  Castle,  Jefferson  County  

June  28,  1918 

825 

Coke  made  from  coal  mined  from  the  upper  bench  of 
the  Big  Seam  

Aug.  14  1918 

8  50 

9  50 

Coke  from  washed  coal  District  No.  1,  except  the  New- 
castle Coal  Co  .  . 

Sept     3  1918 

7  00 

8  00 

Prepared  sizes  above  f  inch  $8.  30 

Prepared  sizes  below  f  inch                                6.  00 

Breeze  3.  50 

Yolande  Coal  &  Coke  Co.,  and  District  No.  2,  except 
the  Empire  Coal  Co  

do 

8  75 

9  75 

Prepared  sizes  above  f  inch                            $10  05 

Prepared  sizes  below  f  inch                               7.  75 

Breeze  4.  38 

Newcastle  Coal  Co.  and  district  No.  3,  except  the  Gulf 
State  Steel  Co.  at  Sayre,  and  the  Yolande  Coal  & 
Coke  Co 

do 

7  85 

8  85 

Prepared  sizes  above  f  inch  $9.  15 

Prepared  sizes  below  ^  inch                              6  85 

Breeze  .  .                                     .                        3.  93 

Empire  Coal  Co  ,  

do  

10.50 

"10.50 

Prepared  sizes  above  f  inch                             $10.  80 

Prepared  sizes  below  f  inch  9.  50 

Breeze                                                                5.  25 

Gulf  State  Steel  Co  at  Sayre 

do 

8  50 

9  50 

Prepared  sizes  above  f  inch                              $9  80 

Prepared  sizes  below  f  inch                              6.  50 

Breeze                                                                4  25 

Colorado  

fApr.   15,1918 

8.50 

9.50 

Georgia: 
Durham  Coal  &  Coke  Co 

\May     8,  1918 
Dec.  31  1917 

8  00 

8  00 

9.80 
8  00 

Walker  County  

Feb.  15,1918 

8.75 

8.75 

Kentucky: 
Marrowbine  Mining  Co.  at  Lookout,  Pike  County 

Julv     1,  1918 

Pike  County,  except  at  the  plant  of  the  Marrowbine 
Mining  Co  

July   29,1918 

6.50 

7.50 

Hopkins  County  .  .  . 

Nov.  18,1918 

7.25 

8.25 

GOVERNMENT   REGULATIONS   RELATING  TO  PRICES. 


659 


District. 

Date  when 
effective. 

48-hour 
blast 
furnace. 

72-hour 

selected 
foundry. 

Crushed 
over 
1-inch 
size. 

Modifications—  Con  tinued 
New  Mexico 

Apr.  2G,  1918 

Feb.  15,  1918 
May  13,  1918 

Dec.  31,  1917 

Mar.    1,  1918 
do 

$8.50 

10.75 
10.75 

7.25 

8.00 

8.50 
7.25 

, 

8.25 
7.25 
7.25 
8.50 
7.25 
10.00 

8.00 

8.00 
6.75 
8.00 
6.75 
7.00 
6.50 
7.75 
8.00 
6.25 
6.75 
6.75 
6.25 
7.00 
8.00 
8.00 
6.75 
6.75 

$9.50 

11.75 
11.75 

8.25 

8.00 

8.50 
8.25 

8.25 
8.25 

8.25 

9.50 
8.25 
11.00 

8.00 

8.00 
7.75 
8.00 
7.75 
8.00 
7.50 
7.75 
8.00 
7.25 
7.75 
7.75 
7.25 
8.00 

Oklahoma: 
McCurtain  Coke  Co.,  for  coke  f.  o.  b.  Panther  on  the 
main  line  of  the  Fort  Smith  &  Western  R  .  R  

Howe  plant  of  the  Howe-McCurtain  Coke  Co  

Pennsylvania: 
Taylor  and  McCoy  at  Glen  White,  Blair  County  

Indiana  County:  Coke  made  from  washed  coal  taken 
exclusively  from  the  lower  bench  of  coal  from  the 
upper  Fremont  seam,  if  the  ash  exceeds  10  per  cent 
or  if  the  sulphur  exceeds  0.9  per  cent          

If  the  ash  is  less  than  10  per  cent  and  the  sulphur  is  less 

Cambria  County 

Mar.  20,  1918 

Dec.  31,  1917 
Apr.  26,  1918 
June  25,  1918 
July    9,  1918 
May  13,  1918 
Mar.  30,  1918 

Dec.  31,  1917 

Feb.  15,  1918 
Mar.    1,1918 
do 

Tennessee: 
Sewanee  Fuel  &  Iron  Co.,  Lone  Rock  ovens  at  Tracy 
City                                                                 .  . 

Cumberland  County                 

Utah 

Virginia:  Wise  and  Leo  Counties  

Washington       .                                      

West  Virginia: 
Babcock  Coal  &  Coke  Co.,  Scotia  Coal  &  Coke  Co.,  Fire 
Creek  Coal  &  Coke  Co    all  in  Fayette  County 

$8.00 
8.00 

New  River  district  on  Chesapeake  &  Ohio  R.  R.  run- 
ning from  Thurmond  north  as  far  as  Elmo  andon  the 
Chesapeake  &  Ohio  R.  R.,  and  Kanawha,  Glen  Jean 
and  Eastern  Railroads  running  from  Thurmond  as 
far  southwest  as  McDonald     

Preston  County 

Flat  Top  or  Pocahontas  district 

Coke  made  at  Meridan,  Barbour  County       

do        .  . 

Tucker  County 

Mar.  20,  1918 
Mar.  30,  1918 
do 

Kanawha  district,  Fayette  County      

Nicholas  County 

New  River  district 

Feb.  15,  1918 
Apr.  26,  1918 
do 

Marion  and  Harrison  Counties          .          



Barbour  and  Randolph  Counties 

Preston  County           

Mar.  30,  1918 
Apr.  15,  1918 
June  25,  1918 
June  26,  1918 
July  12,  1918 
Aug.  14,  1918 
Nov.  18,  1918 

Monongalia.  County                                       -          .... 

New  River  district                       

Do 

8,00 
7.75 
7.75 

8.00 

Taylor  County                                   .                   .... 

i  Any  grade. 

NOTE.— The  folio  whig  classifications  and  prices  were  announced  July  8, 1918: 

The  maximum  price  for  crushed  coke  over  f-inch  size  shall  be  the  maximum  price  for  72-hour  selected 
foundry  coke,  plus  30  cents. 

The  maximum  price  for  all  prepared  sizes  of  clean  dry  screened  coke  under  f-inch  size  shall  be  $1  less 
than  the  price  for  blast-furnace  coke  made  at  beehive  ovens  where  such  coke  is  produced. 

The  maximum  price  for  breeze  shall  be  one-half  the  price  established  for  blast-furnace  coke  made  in 
beehive  ovens  where  such  breeze  is  produced. 

The  maximum  price  for  mixed  sizes  of  properly  screened  and  cleaned  beehive  or  by-product  coke, 
suitable  for  domestic  purposes,  shall  be  $1  less  than  the  maximum  Government  price  for  selected  foundry 
coke,  f.  o.  b.  cars  at  the  same  point,  effective  July  25,  1918.  This  was  modified  on  Sept.  30,  1918,  and  all 
coke  as  described  above  and  reclaimed  from  accumulated  breeze  piles  shall  be  $5.50. 

BY-PRODUCT  COKE. 


District. 

Date  when 
effective. 

Run  of 
oven. 

Selected 
foundry. 

Crushed 
over 
1  inch  in 
size. 

By-products  coke  base  prices 

Nov.  19  1917 

16.00 

$7.00 

$6.50 

Modifications. 
Alabama: 
Coke  made  from  coal  mined  in  the  Nickel  Plate  district 

Mar    20  1918 

7  00 

7  00 

From  washed  coal 

Sept.   1,  1918 

5.70 

6.70 

do 

7.75 

8.75 

Prepared  sizes  above  J  inch       $8.  25 

Prepared  sizes  below  f  inch                                6.  75 

Breeze  3.  88 

Tennessee:  Chattanooga         

Mar.    1,  1918 

8.25 

9.25 

8.75 

Washington..  .                         .                                 

Mar.  30  1918 

10  00 

11.00 

660 


HISTORY   OF   PRICES   DURING   THE   WAR. 


ORDER  OF  JULY  8,  1918. 

The  maximum  price  for  crushed  coke  over  f-inch  sizes,  produced  by  any  by- 
product oven  plant,  was  to  be  the  maximum  price  for  run  of  oven  coke,  plus  50 
cents. 

The.  maximum  price  for  all  prepared  sizes  of  clean  dry  screened  coke  under 
'/-inch  size,  was  to  be  $1  per  ton  less  than  the  Government  price  for  run  of  oven 
coke  made  in  by-product  ovens  where  such  coke  was  produced. 

The  maximum  price  of  breeze  was  to  be  one-half  the  Government  price  for 
run  of  oven  coke  made  in  by-product  ovens  where  such  coke  was  produced. 

ORDER  OF  JULY  24,  1918. 

The  maximum  price  for  mixed  sizes  of  properly  screened  and  cleaned  by- 
product coke  suitable  for  domestic  purposes,  was  to  be  $1  less  than  the  maxi- 
mum Government  price  for  selected  foundry  coke  f.  o.  b.  cars  at  the  same  point. 

ORDER  OF  SEPTEMBER  1,  1918. 

Thirty  cents  was  thereafter  to  be  deducted  from  nil  prices  for  by-product 
coke  as  previously  published,  except  in  the  State  of  Washington. 

Gas  coke. — Under  the  original  orders  regulating  the  sale  of  coke,  the  maxi- 
mum price  of  gas  coke  sold  for  industrial  or  metallurgical  use  was  to  be  as 
that  of  the  Government  price  for  the  corresponding  grade  of  coke  produced  in 
by-product  ovens. 

Gas  coke  sold  for  household  purposes  was  to  be  sold  at  the  Government 
price  established  for  anthracite  coal  in  the  same  locality. 

On  July  8  an  order  was  issued  for  more  definite  control  of  gas  coke  prices. 


District? 

Date  when 
effective. 

Base 
price. 

Localities  where  anthracite  coal  is  not  obtainable: 
Hun  of  retorts.  .....                                     

July     9,1918 

$5.50 

Screened  above  f-inch  size 

do 

6.00 

Screened  and  sized  about  3-inch  size    .               

do  

6.50 

Screened  and  sized  between  J  and  f  inch 

do 

4  50 

Run  of  retorts                                                                        

Aug.    1,1918 

5.50 

Screened  above  f-inch  size 

do 

6  00 

Prepared  sizes  above  f-inch  size 

do  

6.50 

Prepared  sizes  below  3-inch  size 

do 

4  50 

Colorado,  except  at  Colorado  Springs: 
Run  of  retorts  

Sept.  30,1918 

5.50 

Screened  over  f  inch  

do  

6.00 

Prepared  sizes  above  f-inch 

do 

6.50 

4  50 

Run  of  retort  

Nov.  27,1918 

6.00 

Run  of  retort  screened  over  '{-inch  scrocn 

do  

6.50 

Prepared  sizes  above  '-inch 

do 

7.00 

Prepared  sizes  below  f-inch 

do  

5.00 

Colorado  Springs                                                                            

(') 

Indiana,  at  Evansville: 

Nov      4  1918 

7.45 

Run  of  retort  screened  over  f-inch  screen 

7.95 

8.45 

Prepared  sizes  below  3-inch 

6.45 

1  Prices  as  scheduled,  plus  50  cents  per  ton. 

Where  anthracite  coal  was  obtainable,  the  maximum  prices  of  various  grades 
of  gas  coke  were  to  be  as  follows : 

Screened  and  sized  above  $  inch,  the  same  price  as  that  established  for  stove 
anthracite  in  the  same  locality. 

Hun  of  retorts  screened  about  f  inch,  25  cents  less  than  the  price  of  stove 
anthracite. 

Run  of  retorts  not  screened,  75  cents  less  than  the  price  of  stove  anthracite. 

The  maximum  price  of  breeze  was  to  be  one-half  the  Government  price  for 
run  of  retorts  coke  unscreened,  made  in  gas  retorts  where  such  breeze  was  pro- 
duced. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  661 

An  order  of  August  1,  1918,  superseding  the  above,  provided  that  the  maxi- 
mum price  for  screened  and  sized  above  f  inch  should  be  the  same  as  the 
Government  price  for  the  stove  anthracite  f.  o.  b.  cars  at  the  mines  in  that 
district,  which  took  the  lowest  freight  rate  to  the  plant  where  the  coke  was 
produced,  plus  that  freight  rate. 

Other  grades  were  priced  as  before,  with  the  addition  of  said  freight  rate. 

CHARCOAL. 


Commodity. 

Date  when 
effective. 

Trice 
per 
bushel. 

Lump  in  bulk 

July     9  1918 

Cents. 
30 

Lump  in  bags 

'do 

32 

Screenings  in  bags  1  

do.. 

20 

NOTE. — These  prices  are  per  bushel  of  20  pounds  f.  o.  b.  cars  at  point  of  shipment. 
An  order  of  August  13,  1918,  permitted  the  completion,  at  the  contract  price,  of  contracts  for  the  sale  of 
charcoal,  entered  into  prior  to  July  8, 1918. 

JOBBERS'  MARGINS  AND  DISTRIBUTORS'  COMMISSIONS. 

An  Executive  order  of  the  President  of  August  23,  1917,  established  the  first 
margins  for  jobbers  along  with  the  President's  prices  for  anthracite  coal : 

The  following  regulations  shall  apply  to  the  intrastate.  interstate,  and  for- 
eign commerce  of  the  United  States,  and  the  prices  and  margins  referred  to 
herein  shall  be  in  force  pending  further  investigation  or  determination  thereof 
by  the  President. 

JOBBERS'    MARGINS. 

1.  A  coal  jobber  is  defined  as  a  person    (or  other  agency)    who  purchases 
and  resells  coal  to  coal  dealers  or  to  consumers  without  physically  handling  it 
on,  over,  or  through  his  own  vehicle,  dock,  trestle,  or  yard. 

2.  For  the  buying  and  selling  of  bituminous  coal  a  jobber  shall  not  add  to 
his  purchase  price  a  gross  margin  in  excess  of  15  cents  per  ton  of  2,000  pounds, 
nor  shall  the  combined  gross  margins  of  any  number  of  jobbers  who  buy  and 
sell  a  given  shipment  or  shipments  of  bituminous  coal  exceed  15  cents  per 
ton  of  2,000  pounds. 

3.  For  buying  and  selling  anthracite  coal  a  jobber  shall  not  add  to  his  pur- 
chase price  a  gross  margin  in  excess  of  20  cents  per  ton  of  2,240  pounds  when 
delivery  of  such  coal  is  effected  at  or  east  of  Buffalo.     For  buying  or  selling 
anthracite  coal  for  delivery  west  of  Buffalo  a  jobber  shall  not  add  to  his  pur- 
chase price  a   gross  margin  in  excess  of  30  cents  per  ton  of  2,240  pounds. 
The  combined  gross  margins  of  any  number  of  jobbers  who  buy  and  sell  a 
given   shipment  or   shipments   of  anthracite  coal   for   delivery   at  or  east   of 
Buffalo  shall  not  exceed  20  cents  per  ton  of  2,240  pounds,  nor  shall  such  com- 
bined margins  exceed  30  cents  per  ton  of  2,240  pounds  for  the  delivery  of 
anthracite  coal  west  of  Buffalo ;  provided  that  a  jobber's  gross  margin  realized 
on  a  given  shipment  or  shipments  of  anthracite  coal  may  be  increased  by  not 
more  than  5  cents  per  ton  of  2,240  pounds  when  the  jobber  incurs  the  expense 
of  rescreening  it  at  Atlantic  or  lake  ports  for  transshipment  by  water. 

Additional  regulations  were  announced  by  the  United  States  Fuel  Adminis- 
tration on  October  6,  1917. 

REGULATIONS     CONCERNING    JOBBERS. 

Operators  who  maintain  their  own  sales  department,  whether  in  their  own 
name  or  under  a  separate  name,  and  dispose  of  coal  directly  to  the  dealer  or 
consumer  shall  not  charge  any  jobber's  commission.  A  jobber  must  be  entirely 
independent  of  the  operator  in  fact  as  well  as  in  name  in  order  to  be  entitled 
to  charge  a  jobber's  commission. 

Free  coal  shipped  from  the  mines  subsequent  to  the  promulgation  of  the 
President's  order  fixing  the  price  for  such  coal  shall  reach  the  dealer  at  not 


662  HISTORY    OF    PRICES   DURING   THE   WAR. 

more  than  the  price  fixed  by  the  President's  order  plus  only  the  prescribed 
jobbers'  commission  (if  the  coal  has  been  purclmsed  through  a  jobber)  and 
transportation  charges. 

A  jobber  who  had  already  contracted  to  buy  coal  at  the  time  of  the  Presi- 
dent's order  fixing  the  price  of  such  coal  and  who  was  at  that  time  already 
under  contract  to  sell  the  same  may  nil  his  contract  to  sell  at  the  price  named 
therein. 

A  jobber  who  at  the  time  of  the  President's  order  fixing  the  price  of  the 
coal  in  question  at  the  mine  had  contracted  to  buy  coal  at  or  below  the 
President's  price  and  at  that  time  had  no  contract  to  sell  such  coal  shall  not 
sell  the  same  at  a  price  higher  than  the  purchase  price  plus  the  proper  jobber's 
commission  as  determined  by  the  President's  regulation  of  August  23,  1917. 

A  jobber  who  at  the  time  of  the  President's  order  fixing  the  price  of  the 
coal  in  question  was  under  contract  to  deliver  such  coal  at  a  price  higher  than 
a  price  represented  by  the  price  fixed  by  the  President  or  the  Fuel  Adminis- 
trator for  such  coal  plus  a  proper  jobber's  commission  as  determined  by  the 
President's  regulation  of  August  23,  1917,  shall  not  fill  such,  contract  with  coal 
purchased  after  the  President's  order  became  effective  and  not  contracted  for 
prior  thereto  at  a  price  in  excess  of  the  President's  price  plus  the  proper 
jobber's  commission. 

A  jobber  who  at  the  date  of  the  President's  order  fixing  the  price  of  the  coal 
in  question  held  a  contract  for  the  purchase  of  coal  without  having  already 
sold  or  contracted  to  sell  such  coal  shall  not  soil  such  coal  at  more  than  the 
price  fixed  by  the  President  or  the  Fuel  Administrator  for  the  sale  of  such 
coal  after  the  date  of  such  order  plus  the  jobber's  commission  as  fixed  by  the 
President's  regulation  of  August  23,  1917. 

Every  jobber  of  coal  or  coke  in  the  United  States  shall  file  with  the  Federal 
Trade  Commission,  Washington.  D.  C.,  on  or  before  October  25,  1917,  a  state- 
ment showing  (1.)  his  name;  (2)  post-office  address;  (-3)  date  of  the  establish- 
ment of  his  business;  (4)  names  of  stockholders,  members,  and  partners  of 
the  jobbing  concern;  (5)  financial  interests  of  stockholders,  members,  and 
partners  of  the  jobbing  concern  in  any  mine  producing  coal.  Any  jobbing 
concern  which  may  be  established  after  the  issuance  of  this  regulation  shall 
immediately  upon  its  organization  file  a  similar  statement  with  the  Federal 
Trade  Commission.1 

On  March  15,  1918,  the  President  issued  a  proclamation  licensing  all  persons 
engaged  in  the  business  of  distributing  coal  and  coke  except  those  exempted  by 
Congress.  Licenses  were  required  by  April  1,  1918,  and  licenses  included  job- 
bers, brokers,  selling  agents,  purchasing  agents,  wholesalers  or  dealers  in  any 
capacity. 

A  license  board  was  appointed  by  the  Fuel  Administration,  and  regulations 
governing  licenses  were  effective  April  1,  1918.2 

RETAIL  PRICES. 

Local  committees  were  organized  for  determining  the  proper  basis  for  sales 
by  retail  dealers. 

Retail  gross  margins  were  established  by  the  Fuel  Administrator  on  October 
1,  1917. 

On  and  after  the  1st  day  of  October,  1917,  in  making  prices  and  sales  to 
consumer,  the  retail  gross  margin  (as  hereinafter  defined)  added  by  any  retail 
dealer  to  the  average  cost  (determined  as  hereinafter  provided)  of  any  size 
or  grade  of  coal  or  coke  for  each  class  of  business  shall  not  exceed  the  average 
gross  margin  added  by  such  dealer  for  the  same  size  or  grade  for  each  class 
of  business  during  the  calendar  year  1915,  plus  30  per  cent  of  said  retail  gross 
margin  for  the  calendar  year  1915:  Provided,  hoirercr.  That  the  retail  gross 
margin  added  by  any  retail  dealer  shall  in  no  case  exceed  the  average  added 
by  such  dealer  for  the  same  size,  grade,  and  class  of  business  during  July,  1917. 

By  this  order  retailers  are  required  to  fix  a  retail  gross  margin  which  may 

1  Modifications  of  these  regulations   issued  from   time  to   time   appear   in   pp.   444-45L' 
of  the  General  Orders,  Regulations,  and  Rulings  of  the  Fuel  Administration. 

2  General  Orders,  Regulations,  atid  Rulings  of  the  Fuel  Administration,  pp.  452-467. 


GOVERNMENT   REGULATIONS   RELATING   TO    PRICES.  663 

be  less  than  but  shall  not  in  any  instance  exceed  the  margin  added  by  them  in 
1915  plus  30  per  cent  thereof. 

Definition  of  retail  gross  margin.  —  The  retail  gross  margins  of  the  different 
classes  of  retail  coal  and  coke  dealers  are  denned  as  : 

(1)  The  difference  between  the  price  charged  by  a  retail  coal  or  coke  dealer 
to  consumers  and  the  average  cost  of  coal  or  coke  to  such  retailer,  free  on 
board  railroad  cars  at  his  railroad  siding,  yard,  pocket,  or  trestle,  when  such 
coal  or  coke  is  received  by  him  by  rail. 

(2)  The  difference  between  the  price  charged  by  a  retail  coal  or  coke  dealer 
to  consumers  and  the  average  cost  of  coal  or  coke  to  such  retailer  free  along- 
side his  wharf,  pocket,  or  water  yard,  when  such  coal  or  coke  is  received  by 
him  by  water. 

(3)  The  difference  between  the  price  charged  by  a  retail  coal  or  coke  dealer 
to  consumers  and  the  average  cost  of  coal  or  coke  to  such  retailer  at  whole- 
salers' pockets,  trestles,  railroad  sidings,  mines,  tipples,  dumps,  docks,  yards, 
or  wharves.1 

PETROLEUM. 


There  was  never  any  Government  regulation  of  petroleum  prices,  but 
prices  were  stabilized  through  the  cooperation  of  the  Petroleum  War  Service 
Committee  with  the  Oil  Division  of  the  Fuel  Administration. 

The  chief  of  the  oil  division  in  a  letter  to  the  chairman  of  flu-*  \Var  Industri:>* 
Board,  under  date  of  April  25,  1918,  made  the  following  statement  : 

"  The  petroleum  war  service  committee,  as  a  result  of  an  extended  conference 
with  me  on  the  subject  of  prices-,  have  requested  that  prices  of  petroleum  pns-.l- 
ncts  be  fixed  in  the  same  way  that  steel  prices  were  fixed.  If  this  be  done,  it 
will  greatly  simplify  the  matter  of  allocation  of  purchases."  a 

The  matter  was  referred  to  the  price-fixing  committee  and  some  discussion 
of  it  appears  in  the  minutes  of  the  price-fixing  committee  for  July  15,  1918,  but 
no  action  was  ever  taken.1 

The  petroleum  war  service  committee  finally  worked  out  a  stabilization  policy 
acceptable  to  the  oil  division. 

This  plan  of  August,  1918,  was  effective  on  contracts  entered  into  after  May 
17,  1918,  and  was  to  continue  in  force  until  November  1,  1918,  or  thereafter. 
This  plan  applied  to  certain  petroleum  producing  districts  : 

For  the  Appalachian  division:  1.  That  the  large  purchasing  companies  con- 
tinue to  purchase  crude  oil  at  their  posted  market  price,  and  that  all  other 
purchasers  who  now  pay  a  premium  for  crude  oil  be  hereafter  permitted  to  pay 
a  premium  not  to  exceed  10  cents  per  barrel  above  the  posted  prices  for  the 
various  grades  of  crude  oil. 

2.  That  all  producers  are  requested  to  make  monthly  sales  of  their  crude  oil. 

The  Mid-continent  division  :  1.  That  the  large  purchasing  companies  continue 
to  purchase  crude  oil  at  their  posted  price  in  the  Mid-continent  field,  and  that 
all  other  purchasers  who  now  pay  a  premium  for  crude  oil  be  permitted  hereafter 
to  pay  up  to  a  maximum  premium  above  posted  market  prices  as  follows  : 

For  Gushing  crude,  a  maximum  premium  of  75  cents  per  barrel. 

For  Yale  and  Inay,  a  maximum  premium  of  50  cents  per  barrel. 

For  Garber  crude,  a  maximum  premium  of  $1.50  per  barrel. 

For  Billings  crude,  a  maximum  premium  of  75  cents  per  barrel. 

For  Kay  County  crude,  a  maximum  premium  of  75  cents  per  barrel. 

For  Healdon  crude,  a  maximum  premium  of  30  cents  per  barrel. 

For  all  other  crudes  for  the  whole  Mid-continent  division,  including  Kansas, 
Oklahoma,  and  northern  Texas,  a  maximum  premium  not  to  exceed  25  cents 
per  barrel  with  the  strict  understanding  that  in  no  district  in  which  premiums 
are  being  paid  of  less  than  25  cents  per  barrel,  will  the  United  States  Fuel 
Administrator  permit  the  paying  of  a  higher  premium  than  is  now  in  effect. 

1  Detailed    regulations    appear    in    pp.    199-204    of    the    General    Orders,    Rules,    and 
Regulations. 

2  Minutes  of  War  Industries  Board  and  letter  in  correspondence  flies. 

3  Minutes  of  price-fixing  committee,  Vol.  VI,  July  15,  1918. 


664 


HISTORY   OF   PRICES   DURING   THE   WAR. 


Gulf  coast  and  northern  Louisiana  division:  1.  That  the  large  purchasing 
companies  in  the  Gulf  coast  territory  be  requested  to  establish  a  posted  price 
for  crude  oil  effective  as  of  August  1,  1918,  of  $1.80  per  barrel,  and  continue 
to  pay  said  price  until  November,  1918;  and  that  a  maximum  premium  be  es- 
tablished above  the  posted  price  of  10  cents  per  barrel,  with  the  strict  under- 
standing that  in  no  district  in  which  premiums  are  being  paid  of  less  than  10 
cents  per  barrel,  will  the  United  States  Fuel  Administrator  permit  the  paying 
of  a  higher  premium  than  is  now  in  effect. 

2.  That  the  large  purchasing  companies  establish  a  differential  of  25  cents 
per  barrel  below  the  posted  price  of  Gulf  coast  oil  for  northern  Louisiana  heavy 
oil  below  32d.  gravity,  and  that  a  premium  of  10  cents  per  barrel  be  permitted 
on  this  grade  of  oil ;  that  on  light  crude  oil  a  premium  of  25  cents  per  barrel 
be  permitted,  with  the  strict  understanding  that  in  no  case  where  premiums 
of  less  than  10  cents  and  25  cents  per  barrel,  respectively,  have  been  paid,  will 
the  Fuel  Administrator  permit  the  paying  of  higher  premiums  than  are  now 
in  effect.1. 

Tlie  Fuel  Administrator  fixed  the  price  of  certain  petroleum  products  to  pur- 
chasing agents  of  allied  Governments  on  purchases  from  May  20,  1918,  to  July 
19,  1918: 

F.   O.   B.   GULF   PORTS. 


Trice 
per 
gallon 

(cents). 

Pounds 
gallon. 

Fuel  oil  British  Admiralty  specifications  150  Abel  flash  . 

5.50 
5.25 
7.50 
21.00 
30.00 

3 

6 
51 

Fuel  oil,  United  States  Navy  specifications      

Standard  white  refined  kerosene  135  fire  test,  minimum  gravity  44°  Baume 

Gasoline  United  States  Navy  specifications  '                    " 

Aviation  naphtha,  British  specifications,  302°  F.  final  boiling  point 

F.   O.   B.  NORFOLK,   BALTIMORE,   PHILADELPHIA,  AND  NEW  YORK. 


Fuel  oil,  United  States  Navy  specifications 

Standard  white  refined  kerosene,  135  fire  test,  minimum  gravity  44°  Baum6. 

Gasoline,  United  States  Navy  specifications 

Aviation  naphtha,  British  specifications,  302°  F.  final  boiling  point 

Mexican  reduced  oil,  14/16  gravity  for  bunker  purposes 


7.50 

8.25 

,23.50 

32.00 

6.00 


4.  METALS  AND  METAL  PRODUCTS. 


The  formal  fixing  of  maximum  prices  in  this  group  began  on  September  21, 
1917,  when  the  price  of  copper  was  fixed  by  the  War  Industries  Board.  Fol- 
lowing this  date  price  fixing  was  extended,  first,  by  the  War  Industries  Board, 
and  after  April,  1918,  by  the  price-fixing  committee,  to  cover  other  metals  and 
their  products. 

A  detailed  summary  of  the  Government  regulations  pertaining  to  the  fixed 
price  of  aluminum,  copper,  iron,  and  steel,  lead,  manganese  ore,  nickel,  platinum, 
quicksilver,  silver,  and  zinc  is  presented  in  the  following  schedules : 

ALUMINUM. 

In  the  fall  of  1917  the  Aluminum  Co.  of  America  agreed  to  accept  direct  and 
indirect  Government  orders  at  the  current  price  of  30  cents,  base.  If  the  price 
were  fixed  later  at  a  lower  point,  the  United  States  Government  would  receive 
the  difference  between  this  contract  price  and  the  fixed  price. 

On  March  2,  1918,  the  War  Industries  Board  and  the  producers  agreed  upon 
a  maximum  base  price  of  32  cents  per  pound  f.  o.  b.  United  States  producing 
plant  for  50  tons  and  over  of  ingot  of  98  to  99  per  cent. 

The  conditions  accompanying  the  agreement  were: 

First,  the  producers  of  aluminum  will  not  reduce  the  wages  now  being 
paid ;  second,  aluminum  shall  be  sold  to  the  public  in  the  United  States  and 
to  the  Allies  at  the  United  States  Government  price;  third,  they  will  take 
the  necessary  measures,  under  the  direction  of  the  War  Industries  Board,  for 
the  distribution  of  aluminum  to  prevent  it  from  falling  into  the  hands  of 
speculators  who  might  increase  the  price  to  the  public;  and,  fourth,  they  will 
pledge  themselves  to  exert  every  effort  necessary  to  keep  up  the  production 
of  aluminum  so  as  to  insure  an  adequate  supply  so  long  as  the  war  lasts. 

After  an  investigation  by  the  price-fixing  committee  and  the  Federal  Trade 
Commission  of  the  costs  of  producing  aluminum,  the  following  announcement 
was  made  on  May  28,  1918 : 

The  President  has  approved  an  agreement  made  between  the  producers  of 
aluminum  and  the  price-fixing  committee  of  the  War  Industries  Board  (after 
investigations  by  this  committee  in  conjunction  with  the  Federal  Trade  Com- 
mission as  to  the  cost  of  production)  that  the  new  maximum  base  price  for 
aluminum,  effective  June  1,  1918,  to  September  1,  1918,  shall  be  33  cents  per 
pound  f.  o.  b.  United  States  producing  plants,  for  50  tons  and  over,  of  ingot 
of  98  to  99  per  cent.  Differentials  for  sheet,  rod,  and  wire  will  be  increased 
by  approximately  12^  per  cent;  differentials  for  alloys  will  remain  as  here- 
tofore, i.  e.,  those  approved  by  the  price-fixing  committee  of  the  War  Industries 
Board  on  March  3,  1918. 

The  new  prices  will  be  effective  on  deliveries  made  during  the  period  from 
June  1,  1918,  to  September  1,  1918,  on  contracts  made  during  said  period; 
and  furthermore,  the  new  prices  will  be  effective  on  deliveries  made  during 
said  period  on  existing  contracts  which  specify  that  the  price  shall  be  that  in 
force  at  the  time  of  delivery.  Deliveries  made  during  the  period  June  1,  1918, 
to  September  1,  1918,  on  other  contracts  shall  be  at  the  price  stated  in  such 
contracts,  except  that  on  existing  "  direct  and  indirect  Government  contracts  " 
containing  a  provision  that  refund  is  to  be  made  of  the  difference  between  the 
price  stated  in  the  contract  and  the  "  Government  fixed  price,  if,  as,  and  when 

i  Quoted' from  the  Plan  to  Stabilize  Prices  and  Maintain  Uninterrupted  Flow  of  Crude,  issued  by  the 
national  petroleum  war  service  committee,  New  York  City,  Aug.  18, 1918. 

665 


666 


HISTORY   OF   PRICES   DURING  THE   WAR. 


made,"  such  difference  shall  be  refunded  on  deliveries  made  during  the  period 
from  June  1,  1918,  to  September  1,  1918,  on  presentation  of  proper  proof  that 
the  purchasing  Government  gets  the  benefit  of  the  refund. 

The  conditions  are  as  formerly:  First,  the  producers  of  aluminum  will  not 
reduce  the  wages  now  being  paid ;  second,  aluminum  shall  be  sold  to  the  United 
States  Government,  to  the  public  in  the  United  States,  and  to  the  allied 
governments  at  the  same  maximum  base  price ;  third,  they  will  take  the  neces- 
sary measures,  under  the  direction  of  the  War  Industries  Board,  for  the 
distribution  of  aluminum  to  prevent  it  from  falling  into  the  hands  of  specu- 
lators who  might  increase  the  price  to  the  public;  and,  fourth,  they  will  pledge 
themselves  to  exert  every  effort  necessary  to  keep  up  the  production  of 
aluminum  so  as  to  insure  an  adequate  supply  so  long  as  the  war  lasts. 

The  prices  of  June  1,  1918,  were  continued  on  September  1,  1918,  and  re- 
mained effective  until  March  1.  1919. 

The  following  prices  represent  the  official  schedules  issued  by  the  nonferrous 
metals  section  of  the  War  Industries  Board : 

ALUMINUM. 
[Prices  in  cents  per  pound.] 


Ingot. 

Mar.  6-May  31,  1918. 

June  l,  1918-Mar.  1,  1919. 

1-ton 
lots. 

15-ton 

lots. 

50-ton 
lots. 

1-ton 

lots. 

15-ton 
lots. 

50-ton 
lots. 

98  per  cent  grade 

32.20 
31.40 
32.40 
31.60 
32.40 

32.10 
31.30 
32.30 
31.50 
32.30 

32.00 
31.20 
32.20 
31.40 
32,20 

33.20 
32.  -10 
33.  40 
32.60 
33.40 

33.10 
32.30 
33.30 
32.  50 
33.30 

33.00 
32.20 
33.20 
32.40 
33.20 

94  per  cent  grade 

98  per  cent  grade  (granulated) 

94  per  cent  (granulated) 

No.  12  alloy  

F.  o.  b.  producing  plant  (extras):-                                                                                                      Cents  per 
pound. 

For  guaranteed  99  per  cent  (above  the  price  of  98  per  cent) 20 

For  shipment  from  warehouse  (plus  freight  from  producing  plant) 50 

For  500  pounds  to  1,999  pounds 1 

For  50  pounds  to  499  pounds 3 

For  less  than  50  pounds 5 

FLAT  SHEET. 
[Prices  in  cents  per  pound.) 


Mar.  6-May  31,  1918. 


June  1, 1918-Mar.  1, 1919. 


Gauge. 

1-ton 
lots. 

15-ton 
lots. 

50-ton 
lots. 

1-ton 
lots. 

15-ton 
lots. 

50-ton 
lots. 

Nos.  18  and  heavier  3  to  60  inches 

40  40 

40  20 

40.00 

42.40 

42.20 

42  00 

N  os.  19  and  20,  3  to  60  inches             

41.40 

41.20 

41.00 

43.50 

43.30 

43.  'JO 

^^  to  30  inches  
30  to  48  inches  
48  to  60  inches  
_T      _        ,  0_(3  to  30  inches 

43.40 
45.40 

48.40 
46  40 

43.20 
45.  20 
48.20 
46  20 

43.00 
45.  00 
48.00 
46  00 

45.80 
48.00 
51.40 
49  20 

45.60 
47.  80 
51.20 
49  00 

45.40 
47.60 
51.00 
48.  80 

Nos.  25  and  26\3oto  48  inches  "  " 

48.40 

48.20 

48.00 

51.40 

51.20 

51.00 

TJ     97/3  to  30  inches 

47  40 

47.20 

47  00 

50  30 

50.  10 

49.90 

°-  z'\  30  to  48  inches 

50.40 

50.20 

50.00 

53.70 

53.50 

53.  30 

•N,     9fif  3  to  30  inches         

49.40 

49.20 

49.00 

52.50 

52.  30 

52.10 

IN  o.  ^30  to  4g  inches 

52.40 

52.20 

52.00 

55.90 

55.70 

55.  50 

Vrt  9Q/3  to  30  inches  

52.40 

52.20 

52.00 

55.90 

55.70 

55.50 

IN  o.  ^30  to  43  inches 

56.40 

56.20 

56.00 

60.40 

60.20 

6(100 

No.  30,  3  to  30  inches  .. 

54.40 

54  20 

54,00 

58.20 

58.00 

57.80 

F.  o.  b.  Producing  plant  (extra):  Per  pound. 

For  guaranteed  99  per  cent SO.  20 

For  shipment  from  warehouse  (plus  freight  from  producing  plant) 1. 00 

For  500  pounds  to  1,999  pounds 01 

For  50  pounds  to  499  pounds 03 

For  less  than  50  pounds - 05 

NOTE.— Grades  33  and  9S  per  cent. 


GOVERKMEXT   REGULATIONS   RELATING   TO  PRICES. 


667 


FLAT  SHEET  CIRCLES. 


Nos.  18  and  heavier,  3  to  60  inches  
Nos.  19  and  20,  3  to  60  inches  

42.40 
43.40 

42.20 
43.20 

42.00 
43.00 

4-1.70 
45.  80 

44.50 
45  60 

&JD 

45  40 

[3  to  30  inches... 
Nos.  21  to  24,  inclusive^  30  to  48  inches.. 
148  to  60  inches. 
Nas.  25  and  26            .  .  £J°  30  inches  .  . 

45.  40 
47.40 
50.40 
48.40 

45.  20 
47.20 
50.20 
48.20 

45.00 
47.00 
50.00 
48.00 

48.00 
50.30 
53.70 
51.40 

47.80 
50.10 
53.50 
51.20 

47.60 
49.90 
53.30 
51.00 

\30  to  48  inches. 
jf     27                              /3  to  30  inches.. 

50.40 
49.40 

50.  20 
49.  20 

50.00 
49.00 

53.70 
52.50 

53.50 
52.30 

53.30 
52.10 

\30  to  48  inches  . 
•NT-  o»                            /3  to  30  inches.. 

52.40 
51.40 

52.  20 
51.20 

52.00 
51.00 

55.90 
54.80 

55.70 

54.60 

55.50 
54.40 

"\30to48inches. 
•KT     2Q                              J3  to  30  inches.. 

54.40 

54.40 

54.20 
54.20 

54.00 
54.00 

58.20 
58.20 

58.00 
58.00 

57.80 
57.80 

\30to48inches. 
No.  30,  3  to  30  inches  

58.40 
56.40 

58.20 
56-20 

58.00 
56.00 

62.70 
60  40 

62.50 
60  20 

62.30 
60  00 

F.  o.  b.  producing  plant   (extras)  :        ^                                                                               !Vr  pound. 

For  guaranteed  99  per  cent $0.  20 

For  shipment  from  warehouse  (plus  freight  from  producing  plant* 1.  00 

For  500  pounds  to  1,999  pounds .01 

For  50  pounds  to  499  pounds .03 

For  less  than  50  pounds .05 

NOTE. — Grades  38  and  98   per  cent. 

17-L.  FLAT  SHEET. 


Nos.  18  and  heavier  3  to  40  inches 

59.40 

59.20 

59  00 

63  80 

63  60 

63  40 

Nos.  19  and  20,  3  to  24  inches  

60.40 

60.20 

60.00 

64.90 

64  70 

64  50 

Nos.  21  to  24,  inclusive,  3  to  24  inches  
Nos.  25  and  26,  3  to  24  inches 

62.40 
65  40 

62.20 
65  20 

62.00 
65  00 

•     67.20 

70  50 

67.00 
70  30 

66.80 
70  10 

No.  27,  3  to  24  inches 

66  40 

66  20 

66  00 

71  70 

71  50 

71  30 

No.  28,  3  to  24  inches  

68.40 

68  20 

68  00 

73  90 

73  70 

73  50 

No.  29,  3  to  24  inches 

71  40 

71  20 

71  00 

77  30 

77  10 

76  90 

No.  30,  3  to  24  inches  

73.40 

73.20 

73  00 

79  50 

79  30 

79  10 

F.  o.  b.  producing  plant   (extras)  :  ivr  pound. 

For  shipment  from  warehouse  (plus  freight  from  prodxicing  plant) §1.00 

For  500  pounds  to  1,999  pounds .  01 

For  50  pounds  to  499  pounds ^       .  03 

For  less  than  50  pounds .  05 


NOTE. — These  prices  include  tempering, 
from  above   prices. 


If  untempered  sheet  is  ordered,  deduct  6  cents 


COILl-:i>    SHEET. 


Mar.6-May31,1918. 


Gauge. 


June  1,  1918-Mar.  1,  1919. 


Nos.  12  to  17,  3  to  18  inches. . . 
Nos.  18  to  20,  3  to  16  inches. . . 
Nos.  21  and  22,  3  to  15  inches. 
Nos.  23  and  24,  3  to  14  inches. 

No.  25,  3  to  13  inches 

No.  26,  3  to  13  inches 

Nos.  27  and  28,  3  to  12  inches . 
Nos.  29  and  30,  3  to  12  inches . 
Nos.  31  and  32,  3  to  12  inches. 
No.  33,  3  to  12  inches 


-ton 
lots. 

15-ton    ;    50-ton 
lots.             lots. 

1-ton 
lots. 

15-ton 
lots. 

50-ton 
lots. 

537.40 

$37.20        $37.00 

$39.00 

$38.  80 

$38.  60 

38.40 
39.40 
41.40 
43.40 
45.  40 

38.20 
39.20 
41.20 
43.20 
45.20 

38.  00 
39.00 
41.00 
43.00 
45.00 

40.20 
41.30 
43.50 
45.  80 
48.00 

40.00 
41.  10 
43.30 
45.  60 

47.  80 

39.80 
40.90 
43.10 
45.40 
47.60 

F.   o.   b.  producing   nlant    (extras)  :  I'IM-  pound 

For  guaranteed  99  per  cent $0.  20 

For  shipment  from  warehouse   (plus  freight  from  producing  plant) 1  00 

For  500  pounds  to  1,999   pounds .  01 

For  50  pounds  to  499  pounds .03 

For  less  than  50  pounds .05 

NOTE. — Grades  3S  and  98  per  cent.     Coiled  sheet  wider  than  the  above  (if  within  the 
limits  of  equipment)  takes  the  price  of  flat  sheet  of  the  same  gauge  and  width. 


668 


HISTORY   OF   PRICES   DURING  THE   WAR. 


COILED   SHEET  CIRCLES. 


Nos.  12  to  17,  3  to  18  inches.  . 

Nos  18  to  20,  3  to  16  inches 

Nos  21  and  22  3  to  15  inches 

$39  40 

$39  20 

$39  00 

$41  30 

§41  10 

$10  90 

Nos.  23  and  24,  3  to  14  inches  .  . 

No  25,  3  to  13  inches 

No  26,  3  to  13  inches  .  . 

40.40 

40  20 

40  00 

42  40 

42  20 

42  00 

Nos.  27  and  28,  3  to  12  inches 

41  40 

41  20 

41  00 

43  50 

43  30 

43  10 

Nos.  29  and  30,  3  to  12  inches  .  . 

43.40 

43.20 

43.00 

45.80 

45.60 

45.40 

Nos.  31  and  32,  3  to  12  inches 

45  40 

45  20 

45  00 

48  00 

47  80 

47  60 

No.  33,  3  to  12  inches 

47  40 

47  20 

47  00 

50  30 

50  10 

49  90 

F.  o.  b.  producing  plant   (extras)  :  Per  pound. 

For  guaranteed  99   per  cent $0.  20 

For  shipment  from  warehouse   (plus  freight  from  producing  plant) 1.00 

For  500  pounds  to  1,999  pounds .01 

For  50  pounds  to  499  pounds .  03 

For  less  than  50  pounds .  05 

NOTE. — Grades  3S  and  98  per  cent.  Coiled  sheet  circles  wider  than  the  above  (if 
within  the  limits  of  equipment)  take  the  price  of  flat  sheet  circles  of  the  same  gauge  and 
diameter. 

WIRE. 


Gauge. 

Spools 
(pounds)  . 

Mar.  6  to  May  31, 
1918. 

June  1,  1918,  to 
Mar.  1,  1919. 

On 

spools. 

In  coils. 

On 

spools. 

In  coils. 

Nos  2  to  10  inclusive 

50 
50 
35 
20 
20 
10 
10 
10 
10 
5  or  2 
5  or  2 
5  or  2 
1 
1 

! 

$0.44 
.47 
.50 
.57 
.63 
.75 
.84 
.96 
1.08 
1.29 
1.49 
1.74 
2.09 
2.49 
3.44 
4.49 

$0.  415 
.44 
.465 
.515 
.565 
.665 
.74 
.84 
.94 

$0.  465 
.499 
.533 
.611 
.689 
.714 
.815 
1.  050 
1.185 
1   421 

$0.  437 
.465 
.493 
.549 
.606 
.718 
.803 
.915 
1.028 

Nos.  11  and  12  

Nos.  13  and  14  

Nos.  15  and  16  .. 

Nos.  17  and  18  

Nos.  19  and  20      ... 

No  21 

No.  22  .                     .       . 

No.  23  

No  24 

No  25 

1.646 

No  26 

1  928 

No  27 

2.321 

No  28 

2  771 

No  29 

3.840 

No.  30... 

5.021 

F.  o.  b.  producing  plant  (extras)  : 
For  guaranteed  99  per  cent. 


For  shipment  from  warehouse  (plus  freight  from  producing  plant). 1 

For  500  pounds  to  1,999  pounds 

For  50  pounds  to  499  pounds 

For  less  than  50  pounds 


Straightened  and  cut  to  length — 

NOTE. — Grade  98  per  cent. 

STEEL  METALLURGY  ROD. 

[Prices  in  cents  per  pound.] 


Per  pound. 

$0  20 

00 
01 
03 
05 
05 


Mar.  6-May  31,  1918. 

June  1-Mar.  1,  1919. 

1-ton 
lots. 

15-ton 
lots. 

50-ton 
lots. 

1-ton 

lots. 

15-ton 
lots. 

50-ton 
lots. 

|  inch,  98  to  99  per  cent  rolled  

33.20 
32.40 

33.10 
32.30 

33.00 
33.20 

34.30 
33.40 

34.20 
33.30 

34.10 
33.20 

§  inch  94  to  98  per  cent  rolled 

F.  o.  b.  producing  plant  (extras)  : 


Per  pound. 


For  guaranteed  99  per  cent  (above  the  price  of  98  per  cent)__ $0.  20 

For  shipment  from  warehouse  (plus  freight  from  producing  plant) 1.  00 

For  500  pounds  to  1,999  pounds .01 

For  50  pounds  to  499  pounds .  03 

For  less  than  50  pounds .  05 


GOVERNMENT   REGULATIONS   RELATING  TO  PRICES.  669 

ROD. 


Mar.  6-May    June  1.  1918- 
31,  1918.        Mar.  1,  1919. 

i  to  f  inch,  98  per  cent  rolled  and  drawn 

$46  00                  $48  80 

|  to  1  inch,  advancing  by  32ds  

] 

1  to  2f  inches,  advancing  by  16ths  

j-98  per  cent  rolled 

41  00                    43  10 

2§  to  3J  inches,  advancing  by  8ths 

F.  o.  b.  producing  plant    (extras)  :  Per  pound. 

For  guaranteed   99  per  cent $0.  20 

For  shipment  from  warehouse  (plus  freight  from  producing  plant) 1.00 

For  500  pounds  to  1,999  pounds .01 

For  50   pounds  to  499  pounds .  03 

For  less  than  50  pounds .05 

NOTE. — Price  includes  straightening  and  cutting  to  length. 

COPPER. 

At  the  request  of  the  President,  the  War  Industries  Board  on  September  21, 
1917,  in  conference  with  the  producers  of  copper,  fixed  the  maximum  price  of 
copper  at  23.5  cents  per  pound.  This  price  was  made  to  apply  to  sale  of  copper 
to  the  United  States  and  allied  Governments  and  to  the  American  public. 

The  agreement  was  subject  to  the  following  conditions:  First,  that  the  pro- 
ducers of  copper  will  not  reduce  the  wages  now  being  paid;  second,  that  they 
will  sell  to  the  United  States  Government,  to  the  public  in  the  United  States, 
and  to  the  allied  Governments  at  not  above  the  maximum  price ;  third,  that  they 
will  take  the  necessary  measures,  under  the  direction  of  the  War  Industries 
Board,  for  the  distribution  of  copper  to  prevent  it  from  falling  into  the  hands 
of  speculators,  who  might  increase  the  price  to  the  public ;  and  fourth,  that  they 
will  pledge  themselves  to  exert  every  effort  necessary  to  keep  up  the  production 
of  copper  so  as  to  insure  an  adequate  supply  so  long  as  the  war  lasts. 

The  following  summary  table  indicates  the  changes  in  the  fixed  price  of  cop- 
per made  from  time  to  time  by  the  War  Industries  Board  and  the  dates  at  which 
those  changes  were  made: 


Price  per  pound  (cents). 

Date  when  effective. 

Date  of  revision. 

23.5 

September  21,  1917  

January  23  1918 

23  5 

January  23,  1918. 

June  1   1918 

23  5 

June  1,  1918 

August  15  1918 

26i 

July  2,  1918  

Do 

262 

August  15,  1918 

November  1  1918 

26  

November  i,  1918  

January  1,  1919.  «  ' 

1  F.  o.  b.  cars  or  lighters  at  refinery  if  shipped  from  eastern  refineries;  f.  o.  b.  New  York  if  shipped  from 
western  refineries. 

2  F.  o.  b.  cars  or  lighters  at  eastern  refineries;  f.  o.  b.  cars  or  lighters  at  Pacific  coast  refineries  for  Pacific 
coast  destinations;  i.  o.  b.  cars  or  lighters  New  York  if  shipped  to  eastern  or  interior  destinations  frcm 
Pacific  coast  refineries  or  from  refineries  in  the  interior  of  the  United  States. 

3  Price  control  was  discontinued  on  this  date. 

On  June  5,  1918,  a  schedule  of  differentials  was  announced.     The  schedule 
follows : 

Differentials  of  June  5,  1918. 


Listed  rectangular  cakes  : 

801  to  1,500  pounds___ $3.  50 

1,501  to  3,300  pounds 4.  50 

3,301  to  4,800  pounds 6.  00 

Bowl    cukes 3.  00 

Ingots *_  1.  00 

Round  cakes  __  3.  00 


•Slabs $1.  50 

Wire  bars,  300  to  500  pounds 2.  50 

Wedge  bars  or  cakes 3.  50 

Billets  : 

4  and  5 _   15.  00 

6 12.  00 

7  and    8 10.00 


These  differentials  were  recommended  by  the  nonferrous  metals  section  of  the 
\Var  Industries  Board  and  approved  by  price-fixing  committee. 


670 


HISTORY   OF   PRICES   DURING   THE    WAR. 


IRON  AND  STEEL. 

The  first  price  agreement  between  the  War  Industries  -Board  and  representa- 
tives of  the  iron  and  steel  industry  was  announced  on  September  24,  1917. 
Maximum  prices  of  iron  ore.  coke,  pig  iron,  steel  bars,  shapes,  and  plates  were  in 
that  agreement  fixed  to  become  immediately  effective  and  to  be  subject  to 
revision  on  January  1,  1918. 

On  October  11  and  again  on  November  5,  1917.  schedules  of  basic  maximum 
prices  on  additional  intermediate  and  finished  iron  and  steel  products  were 
announced.  Maximum  prices  of  other  products  in  this  group  became  effective 
with  the  issue  of  schedules  on  November  13.  November  20,  and  December  22, 
1917,  and  on  January  7,  1918.  The  prices  of  all  iron  and  steel  products  not 
specifically  mentioned  in  these  schedules  were  to  be  fixed  by  the  industry  in 
conformity  with  those  already  announced. 

These  price  schedules  carried  with  them  the  following  stipulations:  First, 
there  shall  be  no  reduction  in  the  current  rate  of  wages;  second,  the  fixed 
prices  shall  apply  to  purchases  by  the  United  States  and  Allied  Governments 
and  by  the  American  public;  and,  third,  every  effort  shall  be  exerted  by  the 
industry  to  maintain  a  high  level  of  production. 

Cast-steel  slugs. — On  September  25,  1918,  a  maximum  price  of  4$  cents  per 
pound  f.  o.  b.  Pittsburgh  was  announced  for  cast  steel  slugs.  This  price 
continued  until  December  31,  1918. 

Steel  rails. — On  December  3,  1918,  the  price-fixing  committee  fixed  the  fol- 
lowing prices  for  steel  rails  to  apply  to  orders  placed  by  the  War  and  Navy 
Departments : 

Bessemer  rails,  $55  per  gross  ton  f.  o.  b.  mill. 

Basic  rails,  $57  per  gross  ton  f.  o.  b.  mill. 

These  prices  pertained  to  contracts  already  made  by  War  and  Navy  Depart- 
ments and  were  not  to  affect  contracts  made  subsequent  to  December  3,  1918. 

The  price  schedules  below  include  all  original  base  prices  and  all  changes  in 
base  prices  as  issued  by  the  American  Iron  and  Steel  Institute  in  January, 
August,  and  November,  1918.  All  schedules  of  differentials,  extras,  discounts 
from  published  lists,  classifications,  and  announcements  by  the  committee  on 
steel  and  steel  products  of  the  Iron  and  Steel  Institute  are  not  here  included,  but 
they  can  be  found  in  the  pamphlets  issued  by  the  American  Iron  and  Steel  Insti- 
tute in  January,  August,  and  November,  1918. 


Commodity. 

Date  or 
period. 

Price  fixed. 

Lower  Lake  ports. 
$5.05  per  gross  ton. 
$0.45  per  ton  additional. 
$0.25  per  ton  additional. 
Increases    are    due    to    increased 
freight   rates,   and   are   subject   to 
change  with  further  changes  in  freight 
rates. 
$6  per  net  ton. 

$33  per  gross  ton,  f.  o.  b.  furnace. 
$34  per  gross  ton. 
$33  per  gross  ton,  f.  o.  b.  furnace. 
$32  per  gross  ton,  f.  o.  b.  furnace. 
$33  per  gross  ton. 
$32.50  per  gross  ton. 

F.  o.  b.  Birmingham. 
* 

F.  o.  b.  Pittsburgh. 
F.  o.  b.  furnace. 

Mesabi  Range,  non-Bessemer 

Sept.  24,  1917 
July     1,  1918 
Oct.     1,  1918 

Sept.  24,  1917 
do 

Do 

Do  

Coke  Connellsville 

Pig  iron: 
No.  2  foundry 

Basic. 

Oct.      1,  1918 
Sept.  24,  1917 
Apr.     1,  1918 
Oct.     1,  1918 
do 

Standard  Bessemer  

Changes  in  basing  points 

do 

Virginia,  Tennessee,  and  Birmingham 
districts  and  the  scattering  districts 
south  of  the  Ohio  and  Potomac  Rivers, 
including  furnaces  at  St.  Louis  but  not 
those  bordering  on  the  Ohio  River. 
Eastern  district;  i.  e.,  from  all  blast  fur- 
naces located  east  of  the  Alleghany 
Mountains  and  north  of  the  Potomac 
River. 
From  all  other  producing  districts  or 
furnaces. 

' 

GOVERNMENT   REGULATIONS    RELATING   TO   PRICES. 


671 


Commodity. 

Date  or 
period. 

Price  fixed. 

Iron  and  steel  scrap.                      .   . 

F.  o.  b.  consuming  point. 
$30  per  gross  ton, 
$29  per  gross  ton. 
$35  per  gross  ton. 
$20  per  gross  ton. 

$3.50  per  100  pounds. 
Per  net  ton  of  2,000  pounds,  without 
penalty. 

$55  i-F.  o.  b.  Birmingham. 
fCO/ 
$55.  35) 
$62.70VF.  o.  b.  New  York. 
$67.  70J 
$54.35) 
S61.80>F.  o.  l>.  Chicago. 
#%.*)> 
F.  o.  b-  maker's  mill. 
$3.  75  per  100  pounds, 

F.  o.  b.  cars  Pittsburgh. 
$4.  50  per  100  pounds. 

F.  o.  b.   Pittsburgh  or  Youngstown, 
Ohio. 
$47.  50  per  gross  ton. 

$51  per  gross  ton. 

$50  per  gross  ton. 
Sol  per  gross  ton. 
F.  o.  b.  Pittsburgh. 
$3.25  per  100  pounds. 
$3..  50  per  100  pounds. 
$3.75  per  100  pounds. 
$4  per  100  pounds. 
F.  o.  b.  Pittsburgh. 
$60  per  gross  ton. 
F.  o.  b.  maker's  mill. 

$73  per  gross  ton. 

$2.90  per  100  pounds   f.  o.  b.  maker's 
mill. 
$3  per  100  pounds  f.  o.  b.  maker's  mill. 
F.  o.  b.  Pittsburgh. 
$3.50  per  100  pounds. 
Do. 
Do. 
F.  o.  b.  Pittsburgh  or  Chicago 
$3  per  100  pounds. 
$3.25  per  100  pounds  f.  o.  b.  Pittsburgh 
or  Chicago. 
F.  o.  b.  Pittsburgh. 
F.  o.  b.  maker's  mill. 
$3  per  100  pounds. 

F.  o.  b.  maker's  mill. 
$0.16  per  complete  joint. 

$1  per  complete  joint. 
F.  o.  b.  maker's  mill. 
$3.25  per  100  pounds  for  25  gross  tons  or 
more. 
F.  o.  b.  maker's  mill. 
$3.25  per  100  pounds. 

$2.90  per  100  pounds. 
$3.15  per  100  pounds. 
$3.25  per  100  pounds. 

Discount  of  52  and  5  and  21  per  cent 
from    manufacturers'    published 
standard  list. 
F.  o.  b.  Pittsburgh. 

$3.40  per  100  pounds. 
$3.55  per  100  pounds. 
F.  o.  b.  Pittsburgh. 
$3.25  per  100  pounds. 
Discount  of  17  per  cent  from  list  pub- 
lished in  pamphlet. 

$6.50  per  100  pounds. 

No  1  heavy  melting  scrap 

Nov.    5,  1917 
Apr.     1,  1918 
Nov.    5.  1917 
do 

Do 

No.  1  railroad  wrought  

Cast-iron  borings  and  machine-shop  turnings 

Iron  products: 
Iron  bars,  base  sizes  

Nov.  13,1917 

Cast-iron  water  pipe,  6-inch  and  larger,  class 
B  or  heavier. 

k 
Boiled  tie  plates 

Dec.   22,1917 

Oct.      1,  1918 
Dec.   22,1917 
June  25,1918 
Oct.      1,  1918 
Dec.    22,1917 
June  25,1918 
Oct.      1,1918 
Dec.   22,1917 

Iron     .  ; 

Steel  (see  Steel  products). 
Standard  railroad  spikes  .  .  . 

Dec.    22,1917 
Oct.    11,1917 

Iron  

Steel  products: 
Blooms,  billets,  slabs,  and  sheet  bars  

Blooms  and  billets,  4  by  4  inches  and 
larger. 
Blooms  and  billets  smaller  than  4  by  4 
inches. 
Slabs  

Sheet  bars 

Shell  bars.. 

Oct.    11,1917 

3  to  5  inches 

Over  5  to  8  inches  .  . 

Over  8  to  10  inches  . 

Over  10  inches 

Forging  steel.     . 

Nov.  13,1917 

Billets,  blooms,  and  slabs 

Forging  ingots  (basic  or  acid  open-hearth 
steel). 
Up  to  and  including  36  inches  diameter, 
with  carbon  not  over  0.25,  cast  in  chilled 
molds. 
Steel  bars  and  small  shapes  (under  3  inches, 
including  shell  steel). 
Rail  steel  bars  (rolled  from  old  steel  rails)  
Steel  bands,  hoops,  and  strips 

Dec.    22,1917 

Sept.  24,1917 

Dec.    22,1917 
May   21,1918 

Bands... 

Hoops 

Hot-rolled  strip  steel  .  .  . 

Steel  structural  shapes  .  . 

Sept.  24,  1917 

3-inch  and  over  

Steel  plates  

Sept.  24,  1917 

July     1,  1918 
Nov.  20,1917 

Light  rails  (45  pounds  per  yard  and  under).  .  . 
Including  10  per  cent  lengths,  down  to 
and  in  eluding1  24  feet. 
Splice  joints  complete  for  light  rails 

Dec.   22,1917 

8-pound  section 

Ranging  to— 
45-pound  angle  bars 

Rolled  steel  angle  splice  bars  
Standard  sections  T  rails,  50  pounds  per 
yard  and  heavier. 
Rolled  tie  plates  

Dec.   22,1917 

Dec.   22,1917 

Steel... 

Skelp 

Oct.    11,1917 

Grooved  skelp 

Universal  skelp  

Sheared  skelp 

Steel  pipe 

Nov.    5,  1917 

f-inch  to  3-inch  black 

Boiler  tubes  .   . 

Nov.  13,1917 

Special  skelp— 
Base  sires 

Other  sizes  

Seamless  steel  tubes  . 

Nov.  13,1917 

Round  billets,  base  sizes 

Cold-rolled  and  cold-drawn  steel  

Nov.    5,  1917 
Nov.  20,1917 

Cold-rolled  strip  steel 

1J  inch  and  wider,  0.100  inch  and  thicker, 
hard  temper,  in  coils  under  0.20  carbon. 

672 


HISTORY   OF   PRICES   DURING   THE    WAR. 


Commodity. 

Date  or 
period. 

Price  fixed. 

Steel  products—  Continued. 
Hot-rolled  trip  steel  

Nov.  20,1917 

F.  o  b  Pittsburgh 

Finished 

$4  50  per  100  pounds 

Unfinished,  for  cold  rolling  

$3.50  per  100  pounds 

Sheets  (Bessemer  and  open-hearth)  
No.  28  black  sheets  

Nov.    5,1917 

F.  o.  b.  Pittsburgh. 
$5  per  100  pounds. 

No.  10  blue  annealed  . 

$4.25  per  100  pounds 

No.  28  galvanized 

$6  25  per  100  pounds 

Tin  plate,  coke  base  (Bessemer  and  open- 
hearth  grades). 
Standard  steel  cut  nails  

Nov.    5,1917 
Dec.   22,1917 

$7.75  per  100-pound  base  box  f.  o.  b. 
Pittsburgh. 
F.  o.  b.  Pittsburgh 

20d  to  6d 

$4  per  100  pounds 

Cut  tacks,  brads,  shoe  finders'  goods,  etc.  (to 
the  jobbing  trade). 
Net  base 

Nov.  20,1917 

$8  80  per  100  pounds 

Steel  wood  screws  

Nov.  20,1917 

Discounts  from  standard  list 

Chain  . 

•F.  o  b  Pittsburgh 

f-inch  common  steel-  proof  coil  chain,  self- 
colored  or  blacked. 
1-inch  base  

Nov.  20,1917 
May  21,1918 

$8  per  100  pounds. 
$7.50  per  100  pounds.  • 

Boat  spikes,  base  sizes 

Nov.  13,1917 

$5.25  per  100  pounds  f  o  b  Pittsburgh. 

Standard  railroad  spikes  
Steel    i\  by  4\  inches  and  heavier    200 

Dec.  22,1917 

F.  o.  b.  cars,  Pittsburgh. 
$3.90  per  100  pounds. 

kegs  or  more  "(200  pounds  each). 
Less  than  200  kegs 

£1  per  100  pounds  extra. 

Iron  (see  iron  products). 
Standard  railroad  track  bolts 

Dec.   22,1917 

F.  o.  b.  cars  Pittsburgh. 

Standard   button   head,   oval   neck,   3^ 

$4.90  por  100  pounds. 

inches  and  larger,  by  f  inch  and  larger, 
with   United  States  standard  square 
nuts  and  rolled  threads,  200  kegs  or 
more  (200  pounds  each). 
Less  than  200  kegs  

$1  per  100  pounds,  extra. 

Bolts,  nuts,  and  rivets 

F.  o.  b.  Pittsburgh. 

Large  rivets  

/Nov.  13,1917 

$4.65,  base. 

Boiler  

\May   21,1918 
..  ..do  

$4.40,  base. 
$4.50,  base. 

Horse  and  mule  shoes 

July    16,1918 

Per  100  pounds  f.  o.  b.,  Pittsburgh. 

Extra  swaged,  extra  light,  light,  medium, 

heavy,  long  heel,  short  heel,  city  pat- 
tern, and  snow  shoes,  also  mule  shoes 
No.  2  and  larger. 
Calks 

July    16  1918 

Per  100  pounds  f  .  o.  b.   Pittsburgh. 

Toe- 
Blunt,  medium,  flat,  and  square  pat- 
tern— 
200-ton  lots  and  over 

$5.50. 

Less  than  200  tons  to  carloads  ,  in- 

$5.75. 

clusive. 
Less  than  carloads  

$5.90. 

Sharp  pattern  — 
200-ton  lots  and  over  

$6.00. 

Less  than  200  tons  to  carloads  ,  in- 

$6.25. 

clusive. 
TT    i       Less  than  carloads 

$6.40. 

Blunt  and  medium  pattern- 

• 

200- ton  lots  and  over. 

Less  than  200-tons  to  carloads,  in- 
clusive. 

Less  than  carloads 

Sharp  pattern — 

200-ton  lots  and  over 

Less  than  200  tons  to  carloads,  in- 
clusive. 

Less  than  carloads 

Tool  steel 

High  speed- 
High  speed 

Tungsten  finishing  steel 

Carbon— 

Nonshrinkable 

Special 

Extra 

Regular 


Jan.     7,1918 


Wire  and  wire  products 

Wire  rods,  No.  5  common 

Wire,  plain 

Wire  products- 
Barbed  wire,  standard  two-point  and  four- 
point  hog  and  cattle  pattern,  painted. 
Wire  nails,  20d  to  60d,  common 


Wire  rope. 


Oct.    11,1917 
Nov.    5,1917 


.do. 


Nov.  13,1917 

....do 

Aug.  28, 1918 


$6.00. 
$6.25. 

$6.40. 

$6.50. 
$6.75. 

$6.90. 

Mill  shipments  f.  o.  b.  point  of  ship- 
ment and  net  without  discount. 

$2  per  pound. 
$0.65  per  pound. 

$0.35  per  pound. 

$0.23  per  pound. 

$0.1 8  per  pound. 

$0.15  per  pound. 

Add  1  cent  to  each  of  above  prices 
when  shipped  from  maker's  ware- 
house stocks. 

F.  o.  b.  Pittsburgh. 

$57  per  gross  ton. 

$3.25  per  100  pounds. 

$3 .65  per  100  pounds. 

$3.50  per  100  pounds. 
Discounts    or   additions   applying   to 
standard  list. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  673 

LEAD. 

The  price  of  lead  was  never  formally  fixed,  but  was  regulated  by  informal 
agreements  between  the  War  Industries  Board  and  the  lead  producers. 

On  December  17,  1917,  a  price  of  7.75  cents  per  pound  f.  o.  b.  East  St.  Louis, 
to  be  effective  from  that  date  until  the  end  of  March,  1918,  was  agreed  upon 
by  the  nonferrous  metals  section  of  the  War  Industries  Board  and  the  lead 
producers'  committee. 

On  April  8,  1918,  it  was  agreed  with  the  approval  of  the  price-fixing  com- 
mittee that  the  price  of  lead  in  any  month  should  be  the  average  monthly  price 
f.  o.  b.  East  St.  Louis,  quoted  by  the  Engineering  and  Mining  Journal  in  that 
month.  Where  the  price  f.  o.  b.  New  York  was  lower  than  the  price  at  East 
St.  Louis,  7£  cents  per  100  pounds  was  to  be  deducted  from  the  East  St.  Louis 
price. 

On  June  14,  1918,  the  lead  producers'  committee  agreed  that  no  pig  lead  other 
than  Government  purchases  should  be  sold  at  more  than  7|  cents  per  pound 
f.  o.  b.  East  St.  Louis.  The  Engineering  and  Mining  Journal  considered  no 
sales  as  made  at  a  higher  figure  in  computing  its  monthly  average  price  at  East 
St.  Louis.  It  was  further  decided  regarding  this  agreement: 

1.  It  should  go  into  effect  at  once  for  an  indefinite  period. 

2.  Further  contracts  should  be  as  slated  and  existing  contracts  modified  to 
conform  to  the  agreement. 

3.  Other  lead  producers  should  be  urged  to  become  parties  to  the  agreement. 
The  same  agreement  was  extended  again  in  August,  1918,  until  November  30, 

1918,  when  the  agreement  expired,  and  was  not  renewed.1 

MA'NGANESE  ORES. 

The  price  of  manganese  was  not  fixed  formally.  A  schedule  of  prices  adopted 
by  the  American  Iron  and  Steel  Institute  was  api^/oved  by  the  ferro  alloys 
division  of  the  War  Industries  Board.  Since  manganese  was  not  bought 
directly  by  the  United  States  Government,  these  prices  pertained  to  purchases 
by  producers  of  steel. 

The  prices  listed  below  became  effective  May  29,  1918,  and  were  discontinued 
on  December  31,  1918. 

The  following  schedule  gives  domestic  metallurgical  manganese  ore  prices  per 
unit  of  metallic  manganese  per  ton  of  2,240  pounds  for  manganese  ore  produced 
and  shipped  from  all  points  in  the  United  States  west  of  South  Chicago,  111. 
This  schedule  does  not  include  chemical  ores  as  used  for  dry  batteries,  etc.  The 
prices  are  on  the  basis  of  delivery  f.  o.  b.  cars  South  Chicago  and  are  on  the 
basis  of  all-rail  shipments.  When  shipped  to  other  destination  than  Chicago 
the  freight  rate  per  gross  ton  from  shipping  point  to  South  Chicago,  111.,  is  to  be 
deducted  to  give  the  price  f.  o.  b.  shipping  point. 

Schedule  for  metallic  manganese  ore  containing  when  dried  at  212°  F. — 
Per  cent.  Per  unit. 

35  to  35.99,  inclusive $0.  86 

36  to  36.99,  inclusive .90 

37  to  37.99,  inclusive .94 

38  to  38.99,  inclusive 1 .98 

39  to  39.99,  inclusive—- 1.  00 

40  to  40.99,  inclusive .. 1.  02 

41  to  41.99,  inclusive 1.  04 

42  to  42.99,  inclusive 1.  06- 

43  to  43.99,  inclusive - 1.  08 

44  to  44.99,  inclusive 1. 10 

1  Report  of  nonferrous  metals  section  to  Mr.  Baruch. 
125547°—  20 43 


674 


HISTORY   OF   PRICES   DURING   THE   WAR. 


Schedule  for  metallic  manganese  ore  containing  when  dried  at  212  F.° — Continued. 
Per  cent.  Per  unit. 

45  to  45.99,  inclusive $1.12 

46  to  46.99,  inclusive 1. 14 

47  to  47.99,  inclusive „ 1. 16 

48  to  48.99,  inclusive — _L ,     1. 18 

49  to  49.99,  inclusive 1.  20 

50  to  50.99,  inclusive 1.  22 

51  to  51.99,  inclusive 1.  24 

52  to  52.99,  inclusive 1.26 

53  to  53.99,  inclusive 1.28 

54  to  54.99,  inclusive 1.  30 

ADDITIONS   TO   UNIT   PRICES. 

For  manganese  ore  produced  in  the  United  States  and  shipped  from  points 
in  the  United  States  east  of  South  Chicago  15  cents  per  unit  of  metallic  manga- 
nese per  ton  shall  be  added  to  above  unit  prices. 

Above  prices  are  based  on  ore  containing  not  more  than  8  per  cent  silica  and 
not  more  than  0.25  per  cent  phosphorus,  and  are  subject  to — 

Silica  premiums  and  penalties. — For  each  1  per  cent  of  silica  under  8  per  cent 
down  to  and  including  5  per  cent  premium  at  rate  of  50  cents  per  ton.  Below 
5  per  cent  silica,  premium  at  rate  of  $1  per  ton  for  each  1  per  cent. 

For  each  1  per  cent  in  excess  of  8  per  cent  and  up  to  and  including  15  per  cent 
silica  there  shall  be  a  penalty  of  50  cents  per  ton ;  for  each  1  per  cent  in  excess  of 
15  per  cent  and  up  to  and  including  20  per  cent  silica  there  shall  be  a  penalty  of 
75  cents  per  ton. 

For  ore  containing  in  excess  of  20  per  cent  silica  a  limited  tonnage  can  be 
used,  but  for  each  1  per  cent  of  silica  in  excess  of  20  per  cent  and  up  to  and 
including  25  per  cent  silica  there  shall  be  a  penalty  of  $1  per  ton. 

Ore  containing  over  25  per  cent  silica  subject  to  acceptance  or  refusal  at  buyer's 
option,  but  if  accepted  shall  be  paid  for  at  the  above  schedule  with  the  penalty 
of  $1  per  ton  for  each  extra  unit  of  silica. 

All  premiums  and  penalties  figured  to  fractions. 

Phosphorus  penalty. — For  each  0.01  per  cent  in  excess  of  0.25  per  cent  of  phos- 
phorus there  shall  be  a  penalty  against  unit  price  paid  for  manganese  of  one- 
half  cent  per  unit,  figured  to  fractions. 

In  view  of  existing  conditions,  and  for  the  purpose  of  stimulating  production 
of  domestic  manganese  ores,  there  will  be  no  penalty  for  phosphorus  so  long  as 
the  ore  shipped  can  be  used  to  advantage  by  the  buyer.  The  buyer  reserves  the 
right  to  penalize  excess  phosphorus  as  above  by  giving  60  days'  notice  to  the 
shipper. 

The  above  prices  to  be  net  to  the  producer ;  any  expenses,  such  as  salary  or 
commission  to  buyer's  agent,  to  be  paid  by  the  buyer. 

Settlements  to  be  based  on  analysis  of  ore  sample  dried  at  212°  F.  The  per- 
centage of  moisture  in  ore  sample  as  taken  to  be  deducted  from  the  weight. 

On  August  17,  1918,  the  United  States  Railroad  Administration  announced  the 
following  schedule  of  freight  rates  on  manganese  ore,  establishing  rates  lower 
than  the  prevailing  rates  carried  in  current  tariffs: 

MANGANESE  ORE,  CARLOAD,  PER  TON  OF  2,000  POUNDS. 
[Minimum   carload   weight,  60,000   pounds.] 


From  stations  in  — 

Group  D.1 

Group  2.8 

Groups  B 
andC.3 

Group  A.4 

Oregon       

$11.00 

$12.50 

$12.50 

$15.50 

Washington                                                   

11.00 

12.50 

12.50 

13.50 

California 

11.00 

12.00 

12.50 

13.50 

Montana  

8.00 

9.50 

9.50 

10.50 

Arizona 

9.00 

9.00 

10.50 

11.50 

Colorado  '  

7.00 

7.00 

8.50 

9.50 

Nevada.  .. 

10.00 

11.00 

11.50 

12.50 

Utah  

9.00 

10.00 

10.50 

11.50 

New  Mexico.            .  .           .                        .         

7.00 

7.00 

8.50 

9.50 

1  Group  D:  Chicago,  Indiana  Harbor,  and  Erie. 

a  Group  2:  Points  in  Alabama  and  Tennessee  taking  Group  C  rates. 

3  Groups  B  and  C:  Youngstown,  Pittsburgh,  Buffalo,  and  points  in  Ohio. 

«  Group  A:  Points  in  seaboard  territory,  including  Goshen,  Graham,  Reusens,  and  Roanoke,  Va. 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  675 

NICKEL. 

On  January  4,  1918,  a  resolution  was  adopted  by  the  War  Industries  Board 
stating  that  it  was  not  necessary  at  that  time  to  fix  the  price  of  nickel.1 

On  April  2,  1918,  however,  an  agreement  was  made  with  the  International 
Nickel  Co.  to  supply  the  Government  requirements  for  nickel  at  the  following 
rates : 

Cents  per  pound. 

Electrolytic   nickel 40 

Shot   nickel 38 

Ingot  nickel . 35 

These  prices  were  to  be  effective  for  the  duration  of  the  war  and  were  re- 
moved on  January  1,  1919. 

PLATINUM  METALS. 

The  control  over  the  supply  and  prices  of  platinum  metals  was  exercised 
through  a  series  of  requisition  orders  issued  by  the  Ordnance  Department  and 
administered  by  the  chemicals  division  of  the  War  Industries  Board.  The  first 
ordnance  requisition  order,  No.  510,  issued  on  February  23,  1918,  applied  to  14 
firms  dealing  in  platinum,  including  refiners,  jewelers,  and  dental  supply  firms. 

Under  date  of  May  1,  1918,  a  second  requisition  of  the  War  Department  was 
issued  through  the  platinum  section  of  the  War  Industries  Board.  This  super- 
seded the  order  of  February  23,  1918,  and  was  to  cover  all  purchases  to  July  1, 
1918.  About  900  dealers  were  affected  by  this  second  order. 

After  conference  with  the  Secretary  of  War,  the  platinum  section  announced 
the  following  prices  for  Government  purchases  of  platinum  metals : 

Per  troy  ounce. 

Platinum $105 

Iridium 175 

Palladium 135 

On  June  21,  1918,  the  third  of  the  series  of  requisitioning  orders,  covering 
1,555  firms,  was  issued.  The  order  became  effective  June  30,  1918,  and  con- 
tinued so  until  January  1,  1919.  The  prices  of  May  1,  1918,  were  maintained. 
In  this  order  the  prices  of  all  platinum  metals  were  fixed  except  when  the 
metal  was  contained  in  articles  of  jewelry  where  the  value  of  the  labor  exceeded 
20  per  cent  of  the  value  of  the  metal. 

The  control  over  platinum  metals  was  terminated  on  December  1,  1918. 

QUICKSILVER. 

The  War  Industries  Board,  in  conference  with  the  producers  of  quicksilver, 
agreed  upon  the  following  prices  for  Government  supplies  of  quicksilver.  The 
prices  were  effective  from  April  18,  1918,  to  January  1,  1919. 


'  Price.2 

Place  of  delivery. 

Mine. 

$105  per  flask 

(San  Francisco  

California,  Oregon. 

8105  per  flask       

\MareIslandNavyYard  
Marathon,  Tex  

Nevada. 
Texas. 

1  On  May  20,  1918,  the  matter  of  fixing  the  price  of  nickel  was  again  considered,  but 
it  was  deemed  inadvisable  "  because  of  the  present  capacity  being  strained  to  fulfill 
contracts  maturing  with  the  next  two  years.  It  was  requested  and  agreed  to  by  the 
producers  that  pending  a  definite  settlement  of  this  subject  no  contract  should  be 
extended  or  future  contracts  made  without  first  consulting  the  price-fixing  committee." 
(P.  F.  C.  Min.,  Vol.  IV,  May  20,  1918.) 

1  For  deliveries  at  New  York  or  Brooklyn,  75  cents  per  flask  was  added  to  the  prices 
here  given. 


' 


676  HISTOEY   OF   PRICES   DURING   THE   WAR. 

SILVER. 

The  following  letter  was  sent  by  Secretary  McAdoo  to  Senator  Pittman,  of 
Nevada,  who  introduced  a  bill  into  Congress  providing  for  the  use  of  silver  lying 
idle  in  the  Treasury.  The  bill  was  approved  by  Congress  on  April  23,  1918. 

Hon.  KEY  PITTMAN, 

United  States  Senate. 

MY  DEAR  SENATOR  :  I  have  examined  the  draft  of  a  bill  embodying  the  ideas 
which  have  been  discussed  between  us  for  the  utilization  of  the  silver  now  lying 
unused  in  the  Treasury  of  the  United  States.  I  venture  to  recapitulate  briefly 
the  purposes  to  be  accomplished  by  the  bill  and  the  reasons  which,  in  my  judg- 
ment, require  its  enactment. 

The  annual  production  of  silver  has  varied  in  recent  years,  having  fluctuated 
from  160,000,000  ounces  to  226,000,000  ounces  per  annum,  according  to  the  esti- 
mate of  the  Director  of  the  Mint.  Production  for  the  year  1916  amounted  to 
156,600,000  ounces,  and  for  the  year  1917  'is  estimated  to  be  approximately 
160,000,000  ounces.  The  decline  in  production  during  recent  years  has  been 
partly  due  to  conditions  in  Mexico,  as  the  result  of  which  Mexican  mines  have 
not  been  operated  to  their  full  capacity. 

The  price  of  silver  has  varied  from  about  48£  cents  per  fine  ounce,  at  which 
price  it  sold  during  August,  1915,  to  $1.18  per  fine  ounce  during  September,  1917. 
Apart  from  industrial  requirements,  estimated  at  about  100,000,000  ounces  per 
annum,  silver  is  used  by  all  nations  for  subsidiary  coinage,  and  by  India  and 
other  oriental  countries  for  major  coinage.  In  China  uncoined  silver  circulates 
as  money. 

The  European  War  has  greatly  enlarged  the  demand  for  silver.  European 
countries  engaged  in  the  conflict  have  required  unusual  quantities  of  silver  coins 
for  their  armies  and  for  the  civil  population.  Buying  power  of  oriental  coun- 
tries has  been  greatly  enlarged,  and  as  the  importation  of  commodities  has  been 
limited  owing  to  war  needs  of  the  belligerents,  that  buying  power  has  been 
exercised  to  acquire  silver. 

China  and  India  are  two  oriental  countries  that  absorb  the  largest  amounts  of 
silver.  The  products  of  India  are  wheat,  jute,  burlap,  etc.  The  demand  for 
Indian  products  has  been  unusual.  Jute  bagging  is  used  for  sugar,  grain,  and 
fertilizer  bags ;  also  as  outside  wrappers  for  cotton  and  other  products.  It  is 
also  used  for  trench  bags  and  for  packing  many  articles  of  military  necessity. 
No  article  has  been  found  that  will  serve  as  a  substitute. 

The  Orient  is  willing  to  accept  silver  in  place  of  gold  for  commodities  fur- 
nished by  them,  and  it  is  to  the  interest  of  the  United  States  and  its  allies 
that  foreign  trade  balances  should,  as  far  as  possible,  be  settled  in  silver  rather 
than  in  gold.  The  gold  in  this  country  and  in  the  hands  of  its  allies  is  needed 
as  a  base  for  the  enormous  credit  structure  it  is  necessary  to  erect  in  the 
process  of  placing  Government  loans,  and  every  ounce  of  silver  that  can  be  used 
in  the  settlement  of  foreign  balances  is  so  much  gained.  It  is  better  to  settle 
trade  balances  by  shipping  silver  than  to  make  arrangements  for  stabilizing 
exchange,  where  these  are  possible,  as  they  are  not  in  the  Orient,  because  these 
exchange  arrangements,  whatever  their  form,  always  mean  a  deferred  demand 
for  gold,  while  the  settlement  of  foreign  balances  in  silver  is  a  definite  settle- 
ment calling  for  no  future  adjustments.  Further,  the  unprecedented  business 
activity  in  this  country  has  caused  an  unusual  demand  for  silver  for  subsidiary 
coinage,  the  needs  of  the  United  States  for  this  purpose  during  the  present  year 
being  greater  than  ever  before,  amounting,  as  they  do,  to  approximately 
21,250,000  ounces. 

There  are  now  in  the  Treasury  of  the  United  States  approximately  490,000,000 
standard  silver  dollars,  containing  approximately  375,000,000  ounces  of  fine 
silver.  Against  these  *  standard  silver  dollars  there  are  outstanding  silver 
certificates,  and  so  long  as  these  silver  certificates  remain  outstanding  a  corre- 
ponding  amount  of  silver  dollars  must  be  held  for  their  redemption. 

The  proposal  is  now  made  to  borrow  from  the  Treasury  for  the  purposes 
stated  above  a  portion  of  the  silver  so  held  in  the  Treasury,  but  only  upon  the 
cancellation  from  time  to  time  of  a  corresponding  amount  of  outstanding  silver 
certificates.  The  silver  having  been  so  borrowed  and  used,  the  Secretary  of  the 
Treasury  is  required  to  repurchase  from  time  to  time,  at  the  fixed  price  of  $1 
per  fine  ounce,  an  amount  of  silver  equal  to  the  silver  so  borrowed  and  used, 
and  to  recoin  the  silver  into  standard  silver  dollars,  thus  in  time  replacing  in 
the  Treasury  the  silver  so  withdrawn.  In  this  way  the  large  mass  of  silver, 


GOVEKNMENT  REGULATIONS  RELATING  TO  PRICES.  677 

which  is  serving  no  useful  active  purpose,  now  can  be  made  available  for  a 
direct  war  purpose.  There  is  no  intention  of  making  any  permanent  change  in 
the  status  of  the  silver  certificates. 

The  proposition  is,  in  brief,  to  retire  silver  certificates;  to  borrow  from  the 
Treasury  the  silver  for  use  for  the  war  purposes  above  set  forth ;  and  then,  as 
silver  from  time  to  time  in  the  future  comes  on  the  market,  to  replace  the  silver 
so  borrowed  by  purchase  in  the  market  at  the  fixed  price  of  $1  per  fine  ounce 
and  to  replace  the  borrowed  silver  by  coining  the  new  silver  acquired  for  that 
purpose  into  standard  silver  dollars.  There  is  no  limit  of  time  within  which 
this  must  be  done. 

The  cost  of  producing  silver,  like  the  cost  of  producing  all  other  commodi- 
ties, has  greatly  increased.  Labor  is  receiving  very  much  higher  wages  than 
during  normal  times.  Machinery  is  more  expensive,  and  the  chemicals  and 
other  supplies  needed  in  the  production  of  silver  are  all  correspondingly  higher 
in  price.  The  price  at  which  the  silver  is  to  be  rebought  has  been  fixed  in  the 
proposed  bill  at  $1  per  ounce.  This  price  was  arrived  at  after  an  examination 
by  the  Director  of  the  Mint  into  the  cost  of  producing  silver  in  a  number  of 
different  mines,  and  the  Director  of  the  Mint  is  of  the  opinion  that  $1  per 
fine  ounce  under  all  the  conditions  at  present  prevailing  is  a  fair  price.  The 
silver  released  through  the  retirement  of  silver  certificates  will  be  sold  by  the 
Secretary  of  the  Treasury  for  the  war  purposes  stated,  at  a  price  that  will 
permit  him  without  loss  to  rebuy  at  the  price  of  $1  an  ounce  the  silver  thus 
sold. 

The  proposed  measure  is  unquestionably  in  the  interest  of  the  country  as  a 
whole  for  the  prosecution  of  the  war.  It  proposes  no  permanent  change  in  our 
existing  currency  arrangements.  What  is  proposed  is  a  temporary  change, 
consisting  of  the  active  use  for  war  purposes  of  the  silver  now  lying  inert  in 
the  Treasury.  The  bill  provides  within  itself  the  steps  necessary  to  reverse 
that  position  and  to  replace  and  recoin  the  silver. 

The  arrangement  proposed  is  p"urely  a  temporary  arrangement,  and  the 
pressing  needs  of  the  United  States  require,  in  my  opinion,  its  prompt  enact- 
ment into  law. 

Sections  5,  6,  7,  and  8  seem  to  me  the  best  way  of  dealing  with  the  con- 
traction of  the  circulating  medium  which  would  otherwise  be  brought  about 
through  the  cancellation  of  silver  certificates.  This  is  accomplished  by  au- 
thorizing an  issue  of  Federal  reserve  bank  notes  in  small  denominations  in 
order  to  fill  the  void  occasioned  by  the  retirement  of  silver  certificates,  and 
provides  for  the  prompt  retirement  of  those  Federal  reserve  bank  notes  as 
silver  certificates  are  from  time  to  time  reissued.  There  may  well  be  differ- 
ences of  opinion  as  to  the  best  method  of  counteracting  such  contraction.  If 
no  method  of  meeting  the  contraction  be  provided,  the  contraction  will  be  auto- 
matically relieved  through  the  issue  of  legal-tender  notes  in  denominations  of 
ones  and  twos,  Federal  reserve  notes  taking  the  place  of  the  legal  tender  notes. 
This  would  be  perhaps  the  easiest  way  of  meeting  the  situation  were  it  not 
for  the  fact  that  Federal  reserve  notes  are  now  secured  by  gold  reserve  of  over 
60  per  cent,  and  the  issue  of  additional  Federal  reserve  notes  without  a  corre- 
sponding addition  to  the  gold  reserve  would  reduce  the  percentage  of  reserve, 
Federal  reserve  bank  notes,  on  the  other  hand,  require  a  reserve  of  but  5  per 
cent,  and  as  there  is  absolutely  no  reason  why  a  larger  reserve  for  Federal 
reserve  bank  notes  should  be  provided,  it  seems  to  me  unwise  to  reduce  the 
percentage  of  reserve  under  Federal  reserve  notes. 

My  Reason  for  stating  that  the  Federal  reserve  bank  notes,  the  issue  of 
which  is  contemplated  under  the  bill,  require  no  greater  reserve  than  5  per 
cent  is  that  those  notes  in  small  denominations  will  merely  take  the  place  in 
the  pockets  of  the  people  of  the  silver  certificates  now  carried  by  them,  and 
are  thus  extremely  unlikely  to  be  presented  for  redemption.  If  and  to  the 
extent  that  they  are  presented  for  redemption,  it  will  be  a  demonstration  that 
these  notes  are  not  needed  in  the  circulation,  and  the  means  for  their  prompt 
retirement  is  furnished  by  the  deposit  as  security  for  these  Federal  reserve 
bank  notes  of  short-time  certificates  of  indebtedness  or  the  one-year  conversion 
notes  of  the  United  States.  Whenever,  therefore,  these  Federal  reserve  bank 
notes  are  presented  for  redemption  it  will  only  be  necessary  to  let  the  maturing 
obligations  held  against  them  run  off.  The  popular  and  well-founded  feeling 
against  a  bond-secured  currency  therefore  does  not  apply  to  the  present  issue, 
because  (1)  the  issue  is  strictly  temporary  in  its  nature,  (2)  the  security 
behind  the  issue  automatically  provides  for  the  redemption  of  the  issue,  (3)  no 
artificial  value  is  given  to  any  long-time  bonds  by  the  circulation  privilege  and 
no  vested  interest  is  created  in  the  circulation  privilege,  which,  if  created, 
it  might  prove  burdensome  for  the  Government  or  the  banks  to  abate. 


678  HISTORY   OF   PRICES   DURING  THE   WAR. 

If  the  method  suggested  for  dealing  with  the  replacement  of  the  silver  certifi- 
cates that  may  be  retired  does  not  commend  itself  to  you  as  the  best  manner  of 
meeting  the  situation,  I  should  be  glad  to  discuss  any  modifications  that  may 
be  thought  advisable. 

Cordially,  yours,  W.  G.  McAooo.1 

On  August  15,  1918,  the  Treasury  Department  authorized  the  following 
statement :  ^ 

Under  the  authority  of  the  act  of  Congress  approved  April  23,  1918,  silver 
has  been  sold  by  the  Secretary  of  the  Treasury  at  a  price  which  will  permit 
the  Treasury  from  new  purchases  of  a  corresponding  amount  of  silver  at  the 
price  of  $1  per  fine  ounce  to  recoiii  the  silver  purchased  into  silver  dollars 
without  loss.  In  order  to  provide  for  the  various  items  ,of  expense  involved  it 
was  found  necessary  to  fix  the  price  for  which  silver  was  sold  at  $1.01$  per 
fine  ounce,  and  it  was  made  a  condition  of  sale  that  the  purchaser  should  not 
pay  a  higher  price  for  silver  in  other  markets  than  in  those  of  the  United 
States. 

LIMITS    LICENSE    FOB   EXPORT. 

Up  to  the  present  time  the  Federal  Reserve  Board  has  freely  granted  licenses 
for  the  export  of  silver.  In  order,  however,  to  conserve  the  use  of  silver,  export 
licenses  for  silver  will  hereafter  be  granted  only  for  civil  or  military  purposes 
of  importance  in  connection  with  the  prosecution  of  the  war  and  only  in  cases 
where  the  exporter  certifies  that  the  silver  to  be  exported  has  been  purchased 
at  a  price  which  does  not  directly  or  indirectly  exceed  $1.01$  per  ounce  1,000 
fine,  at  the  point  where  silver  is  refined  in  the  United  States,  or  at  the  point  of 
importation  in  the  case  of  imported  silver. 

ADDITIONAL  REQUIREMENTS. 

Applications  for  licenses  to  export  silver  should  also  state  from  whom  the 
silver  was  purchased,  the  point  at  which  silver  was  delivered  to  purchaser,  for 
whose  account  and  by  whose  order,  and  for  what  purpose  the  silver  is  to  be 
exported.2 

These  restrictions  were  removed  by  the  Federal  Reserve  Board  on  May  5, 
1919,  in  the  following  announcement : 

On  August  15,  1918,  the  Federal  Reserve  Board  announced  that  licenses  for 
the  export  of  silver  would  thereafter  be  granted  only  for  civil  or  military  pur- 
poses of  importance  in  connection  with  the  prosecution  of  the  war  and  only  in 
cases  where  the  exporter  certified  that  the  silver  to  be  exported  had  been  pur- 
chased at  a  price  which  did  not  directly  or  indirectly  exceed  $1.01$  per  ounce 
1,000  fine  at  the  point  where  the  silver  is  refined  in  the'  case  of  silver  refined 
in  the  United  States  or  at  the  point  of  importation  in  the  case  of  imported  silver. 
The  occasion  which  required  the  above  limitations  on  the  export  of  silver  having 
now  passed,  the  Federal  Reserve  Board  will  hereafter,  unless  a  Government 
necessity  should  again  arise,  resume  its  former  policy  of  granting  freely  and 
without  condition  all  applications  for  the  export  of  silver  bullion  or  of  silver 
coin  of  foreign  mintage. 

This  change  of  the  policy  of  granting  licenses  does  not  do  away  with  the 
necessity  of  filing  on  application  for  licenses  to  export  silver  bullion  or  silver 
coin  of  foreign  mintage.  Such  applications  must  as  heretofore  be  filed  through 
the  Federal  reserve  banks  of  the  appropriate  district,  but  such  applications  will, 
as  stated  above,  be  freely  granted  by  the  Federal  Reserve  Board. 

The  Secretary  of  the  Treasury  does  not  contemplate  any  further  sales  of  silver 
under  the  Pittman  Act,  except  to  the  Director  of  the  Mint.3 

ZINC. 

On  the  recommendation  of  the  War  Industries  Board  and  with  the  approval 
of  the  President  the  following  maximum  prices  of  zinc  became  effective  on 

1  Official  Bulletin,  Apr.  11,  1918. 
*  Official  Bulletin,  Aug.  17,  1919. 
8  Commercial  and  Financial  Chronicle,  May  10,  1919. 


GOVERNMENT  REGULATIONS   RELATING  TO   PRICES.  679 

February  13,  1918,  were  renewed  on  June  1,  1918,  again  on  September  1,  1918, 
and  remained  in  effect  until  January  1,  1919. 

Grade  A,  12  cents  per  pound  f.  o.  b.  East  St.  Louis. 

Plate,  14  cents  per  pound. 

Slieet,1  15  cents  per  pound. 

These  prices  were  subject  to  the  following  conditions :  (a)  Differentials  shown 
on  the  producers'  lists  at  that  time  were  to  be  allowed;  (6)  the  fixed  prices 
applied  to  new  business  and  not  to  unfilled  contracts  made  prior  to  February  14, 
1918,2  and  to  the  following  more  general  provisions : 

First,  that  the  producers  of  grade  A  zinc  will  not  reduce  the  wages  now  being 
paid ;  second,  they  will  sell  to  the  Allies,  to  the  public,  and  to  the  Government 
at  the  same  price ;  third,  that  they  will  take  the  necessary  measures,  under  the 
direction  of  the  War  Industries  Board,  for  the  distribution  of  the  grade  A  zinc 
to  prevent  it  from  falling  into  the  hands  of  speculators,  who  might  increase  the 
price  to  the  public ;  and  fourth,  that  they  pledge  themselves  to  exert  every  effort 
necessary  to  keep  up  the  production  of  grade  A  zinc,  so  as  to  insure  an  adequate 
supply  so  long  as  the  war  lasts. 

1  Sheet  zinc  included  all  gauges  of  one-eighth  inch  thickness  and  less,  and  plate  zinc  ail 
other  gauges. 

2  Quoted  from  letter  written  on  Apr.  23,  1918,  by  Mr.  Pope  Yeatman,  chief  of  the  non- 
ferrous  metals  section  of  the  War  Industries  Board,  to  Mr.  W.  R.  Ingalls,  editor  of  the 
Engineering  tand  Mining  Journal. 


5.  TEXTILES  AND  FIBERS. 


The  control  over  textile  and  fiber  prices,  which  came  somewhat  later  than 
over  foods,  fuels,  and  metals,  was,  in  the  main,  begun  and  carried  through  by 
the  price-fixing  committee.  The  regulations  which  were  issued  by  the  com- 
mittee, together  with  those  originating  in  the  War  Trade  Board,  the  War 
Industries  Board,  and  the  War  Department,  are  listed  below  under  one  or  the 
other  of  the  following  heads:  Binder  twine,  burlap,  cotton  goods,  cotton 
linters,  kapok,  manila  fiber,  rags,  silk,  and  wool. 

BINDER  TWINE. 

(Mar.  1,  1918,  to  1919  harvest  season.) 

On  March  1,  1918,  the  Food  Administration  announced  an  agreement  with 
the  manufacturers  of  binder  twine,  fixing  the  price  of  binder  twine  for  the  1918 
harvest.  The  following  schedule  shows  the  maximum  differentials  allowed 
above  the  cost  of  sisal  to  the  manufacturers  of  twine,  or  19  cents  a  pound. 

In  June,  1918,  an  arrangement  was  made  for  the  purchase  of  500,000  bundles 
of  sisal  for  the  manufacture  of  twine  for  the  1919  harvest,  at  a  price  of  16 
cents  per  pound.  But  no  change  was  made  in  the  twine  differentials. 

This  contract  as  it  stood  at  the  time  of  the  armistice  will  probably  remain 
in  effect  during  the  1919  harvest  season. 

STANDARD   AND    SISAL   BINDER   TWINE,    500   FEET   TO   THE   POUND,-  F.   O.   B. 

FACTORY. 

Cents 
per  pound. 

Carload  lots  of  20,000  pounds  or  more 4 

Lots  of  10,000  pounds  or  more,  but  less  than  20,000  pounds 4J 

All  amounts  less  than  10,000  pounds 4\ 

Prices  for  other  grades  should  not  exceed  the  prices  of  standard  and  sisal  twine 
by  more  than  the  following  amounts : 

Cents 
increase. 

550  feet  to  the  pound If 

600  feet  to  the  pound 3 

650  feet  to  the  pound 4£ 

650  feet  to  the  pound  (pure  manila) 6 

All  of  these  prices  are  f.  o.  b.  factory. 

The  Food  Administration  considered  the  increased  weight  of  binder  twine  over 
the  sisal  contained  therein  and  the  fact  that  the  manufacturers  have  on  hand  sisal 
purchased  at  lower  prices  or  twine  manufactured  from  lower-priced  sisal. 

BURLAP. 

(Oct.  4,  1918-Jan.  1,  1919.) 

With  the  following  announcement  on  October  25,  1918,  the  War  Industries 
Board  inaugurated  the  control  over  the  prices  of  burlap : 

The  War  Industries  Board,  through  the  jute,  hemp,  and  cordage  section, 
announces  it  has  accepted  the  offer  of  the  burlap  importers  and  bag  manufac- 

680 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  681 

turers  to  establish  the  following  basis  of  maximum  prices  for  burlap  in  carload 
or  larger  quantities,  effective  October  4,  1918 : 

Per  yard,  40  inches  8  ounces,  13.6  cents  Pacific  coast ;  14  cents  Atlantic  and 
Gulf  ports. 

Per  yard,  40  inches  10£  ounces,  16  cents  Pacific  coast ;  16£  cents  Atlantic  and 
Gulf  ports. 

Other  sizes  and  weights  in  equal  proportion. 

Other  points  in  United  States  based  on  freight  from  Pacific  coast. 

Quantities  less  than  carload  at  prices  slightly  higher  to  cover  cost  of  handling. 

These  prices  to  be  effective  until  about  February  1,  1919. 

This  resolution  is  voluntarily  made  by  the  trade  because  much  lower  prices 
are  expected  to  prevail  as  the  result  of  purchases  to  be  made  after  January  1, 
1919,  through  assistance  of  the  War  Industries  Board,  and  therefore  does  not 
affect  the  validity  or  integrity  of  contracts  made  prior  to  October  4,  1918. 

In  its  aim  to  secure  much  lower  prices  for  all  purchasers  of  burlap  in  the 
United  States,  the  War  Industries  Board  realizes  that  this  voluntary  reduction 
represents  very  heavy  losses  to  importers  and  bag  manufacturers.  That  the 
losses  may  be  the  more  equitably  distributed,  it  is  therefore  the  duty  of  each 
citizen  to  stand  loyally  by  any  contract  for  burlap  made  prior  to  October  4,  1918. 

Dealers  in  second-hand  bags  and  burlap  attended  a  conference  with  the  War 
Industries  Board  October  10,  and  after  a  full  explanation  of  the  situation  placed 
themselves  on  record  as  being  in  accord  with  the  action  taken,  and  pledged 
their  loyal  support  to  the  maintenance  of  maximum  prices  on  the  basis  of 
these  prices  for  new  burlap  and  in  the  usual  proportion  thereto. 

Bag  manufacturers  established  maximum  prices  on  bags  f .  o.  b.  factory  on  the 
following  basis : 

Maximum  prices  on  burlap  f.  o.  b.  factory,  plus  cost  of  manufacturing,  plus 
5  per  cent  margin. 

At  the  time  of  the  armistice  negotiations  were  under  way  for  a  price  on 
burlap  under  Government  control  which  show  a  decline  of  about  25  per  cent 
from  the  existing  maximum  prices. 

COTTON  GOODS. 

(July  1,  1918-Jan.  1,  1919.) 

The  regulation  of  the  prices  of  cotton  goods  was  first  formally  considered  in 
a  conference  between  representatives  of  the  industry  and  the  price-fixing  com- 
mittee on  March  26,  1918.  No  action  was  then  taken.* 

On  June  8,  1918,  it  was  agreed  that  a  subcommittee  of  the  price-fixing  com- 
mittee should  meet  with  a  committee  representing  the  industry  and  formulate 
a  definite  plan  of  action. 

On  June  10  the  following  announcement  was  published : 

The  price-fixing  committee  of  the  War  Industries  Board  was  in  conference 
Saturday  with  the  executive  committee  of  the  war  service  committee  of  the 
National  Council  of  American  Cotton  Manufacturers.  In  order  to  establish  a 
basis  for  a  prospective  price  agreement  to  introduce  stabilization  into  the  trade 
and  avoid  any  undue  hardship  upon  the  manufacturer  and  distributor  of  cotton 
goods,  the  following  tentative  plan  was  outlined  to  be  operative  if  the  pending 
negotiations  for  a  price  agreement  are  concluded : 

TENTATIVE  PLAN  OUTLINED. 

On  all  bona  fide  sales  made  on  or  before  June  8,  1918,  for  delivery  previous 
to  January  1,  1919,  prices  to  remain  as  shown  in  sales.  On  all  sales  made  after 
June  8,  1918,  for  delivery  subsequent  to  September  30,  1918,  the  prices  are  to  be 
subject, to  revision  to  accord  with  the  prices  agreed  upon  by  the  price-fixing 
committee  of  the  War  Industries  Board  in  conference  with  the  war  service 
committee  of  the  National  Council  of  American  Cotton  Manufacturers. 

On  all  sales  made  for  delivery  after  January  1,  1919,  the  prices  agreed  upon 
by  the  price-fixing  committee  in  conference  with  the  war-service  committee 
of  the  National  Council  of  American  Cotton  Manufacturers  are  to  be  the  prices, 

1  Price-fixing  committee,  Minute  Book  I,  Mar.  26,  1918. 


682  HISTORY  OF  PRICES   DURING  THE   WAR. 

regardless  of  the  fact  that  the  sales  may  have  been  made  previous  to  June 
8,  1918. 

It  is  understood  that  all  prices  for  so-called  spring  (1919)  business  will  be 
subject  to  such  revision. 

The  plan  contemplates  that  manufacturers'  prices  on  staples  shall  be  on  the 
same  basis  of  cost  and  profit  to  the  Government  and  to  their  usual  civilian  out- 
lets. It  is  further  expected  that  manufacturers  will  agree  to  devote  a  uniformly 
large  proportion  of  their  productive  capacity  to  making  staples.1 

A  few  days  later  supplemental  provisions  were  announced : 

The  price-fixing  committee  recognizes  the  necessity  for  prompt  stabilization, 
and  expects, that  it  will  soon  fix  prices,  even  in  the  absence  of  such  cost  data 
as  would  be  desirable;  and,  accordingly,  it  announces  that  its  action  in  this 
instance  is  not  in  accordance  with  the  usual  procedure  and  may  not  be  expected 
to  be  the  basis  for  future  operations  with  this  industry. 

STIPULATION  AGREED  TO. 

As  a  part  of  the  price  program  which  is  planned  to  be  operative  within  a  few 
days  the  following  stipulation  was  agreed  to,  supplementary  to  the  provisions 
previously  agreed  to : 

All  sales  made  after  June  21  and  before  October  1  will  be  on  the  basis  of  the 
prices  to  be  approved  by  the  price-fixing  committee  to  apply  to  sales  made  before 
October  1,  this  regardless  of  the  period  during  which  delivery  is.  to  be  made. 

Prices  will  later  be  fixed  to  apply  to  sales  made  during  the  period  October  1 
to  December  31,  1918,  or  for  such  other  period  as  may  appear  desirable  at  the 
time. 

The  war-service  committee  submitted  prices  on  a  few  staple  cloths.  The 
prices  are  materially  lower  than  the  present  market  prices.  The  committee  was 
instructed  to  submit  on  July  1  a  schedule  of  prices  on  the  complete  list  of  staples, 
as  well  as  prices  on  cotton  yarns,  all  on  a  parity  with  the  prices  suggested  today.1 

On  July  1,  1918,  the  price-fixing  committee  in  executive  session  agreed  that, 
pending  the  receipt  of  more  definite  data,  it  would  be  expedient  to  fix  a  maximum 
base  price  of  60  cents  per  pound  for  36-inch  sheeting  with  differentials  for  other 
cotton  fabrics.* 

The  official  statement  covering  this  decision  was  approved  July  8,  1918,  and  is 
given  below: 

At  a  meeting  of  the  price-fixing  committee  of  the  War  Industries  Board  with 
the  cotton  manufacturers,  maximum'  net  prices  at  mill  were  agreed  upon  and 
approved  by  the  President  for  the  following  basic  products : 

Cents 
per  pound. 

36  inches,  48  by  48,  3-yard  sheeting 60 

36  inches,  56  by  60,  4-yard  sheeting 70 

38*  inches,  64  by  60,  5.35-yard  print  cloth 83 

38i  inches,  80  by  80,  4-yard  print  cloth 4  84 

Standard  wide  and  sail  duck,  37$  and  5  per  cent  from  list. 

Standard  Army  duck,  33  per  cent  from  list. 

These  prices  represent  a  reduction  from  quoted  market  prices  of  about  20 
to  30  per  cent,  and  apply  to  all  primary  civilian  purchases  as  well  as  to  the 
Government  and  those  Governments  associated  with  us  in  the  war.  A  com- 
mittee is  at  work  on  a  list  comprising  a  full  line  of  staple  cotton  fabrics  for  the 
purpose  of  establishing  prices  upon  a  parity  with  those  herein  quoted.  It  is 
expected  that  this  list  will  be  published  in  a  few  days.  These  prices  are  to 
remain  in  effect  until  October  1  of  this  year,  before  which  date  the  industry  will 
meet  with  the  price-fixing  committee  for  the  purpose  of  agreeing  upon  prices  for 
a  further  period  of  90  days.  Future  agreements  will  be  premised  on  figures  to 
be  collected  and  analyzed  by  the  Federal  Trade  Commission  designed  both  to 
show  basis  of  profit  and  equity  of  parities.  Present  prices  were  necessarily 
based  upon  inadequate  information,  but  in  the  emergency  nature  of  the  case  and 

» Official  Bulletin,  June  10,  1918. 

1  Official  Bulletin,  June  22,  1918. 

8  Price- Fixing  Committee,  Minute  Book   V,   July   1,   1918. 

*  Later  changed  to  86  cents. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  683 

the  advisability  of  a  gradual  adjustment  are  considered  fair  and  equitable  by 
both  the  manufacturers  and  the  price-fixing  committee.  Prices  named  are  to 
cover  primary  sales  made  since  June  8  for  delivery  after  October  1  and  all  pri- 
mary sales  made  since  June  21  regardless  of  the  delivery  dates. 

The  President,  in  approving  these  prices,  has  expressed  his  appreciation  of  the 
spirit  with  which  the  cotton  manufacturers  have  met  the  Government's  efforts  to 
stabilize  an  industry  which  so  directly  reaches  into  the  life  of  every  citizen. 
The  President  calls  upon  and  expects  all  manufacturers  of  ready-to-wear  goods 
as  well  as  all  dealers  in  cotton  fabrics  to  so  regulate  their  profits  as  to  insure 
to  the  consumer  the  full  benefit  of  this  large  reduction  in  price. 

Lists  of  differentials  from  the  basic  prices  were  issued  from  time  to  time.  On 
September  3,  1918,  the  price-fixing  committee  announced  its  future  policy  with 
regard  to  the  fixing  of  differentials : 

In  accordance  with  the  agreement  between  the  representatives  of  the  cotton- 
manufacturing  industry  and  the  price-fixing  committee,  various  differentials 
based  on  the  fundamental  prices  then  agreed  on  have  been  established  and  pub- 
lished. It  is  believed  that  enough  representative  fabrics  have  been  so  priced  to 
make  it  entirely  possible  and  feasible  for  the  industry  itself  to  establish  prices 
on  fabrics  varying  slightly  from  these  representative  numbers,  such  variants 
10  be  prices  in  complete  harmony  with  the  spirit  of  the  agreement  of  July  1, 

1918.  Such  variants  may  be  reviewed  and  modified  by  the  price-fixing  committee 
if  this  course  of  action  seems  advisable. 

The  committee  conferred  with  representatives  of  the  industry  on  September 
25,  1918,  but  owing  to  the  failure  of  a  large  number  of  cotton  mills  to  submit 
their  cost  sheets  within  the  period  requested,  the  committee  found  it  necessary 
to  postpone  its  revision  of  prices. 

With  the  exception  of  a  few  changes  in  maximum  prices,  to  take  effect  October 
1,  1918,  the  schedules  were  extended  until  November  16,  1918. 

The  price-fixing  committee  had  hoped  to  reduce  the  maximum  prices  at  the 
next  conference,  but  when  they  met  with  the  representatives  of  the  industry  on 
November  8  and  9,  the  trade  protested  against  a  reduction,  and  no  new  agree- 
ment was  reached.  The  committee  issued  the  following  statement : 

In  the  absence  of  agreement  on  new  prices  the  present  maximum  limits  on 
cotton  goods  are  left  unchanged  by  the  price-fixing  committee  until  January  1, 

1919,  except  for  certain  revisions  hereinafter  referred  to.     In  making  this  ar- 
rangement the  price-fixing  committee  took  into  consideration  the  special  difficulty 
which  arises  at  the  present  time  in  determining  fair  prices  on  cotton  goods.    The 
price  of  raw  cotton  is  fluctuating  and  uncertain.     The  differentials  for  the 
numerous*  separate  classes  of  cotton  goods  vary  greatly  and  can  not  be  brought 
into  reasonable  conformity  with  each  other  except  after  prolonged  investiga- 
tion.    In  view  of  these  circumstances  the  committee  finds  itself  unable  to  fix 
new  maximum  prices  at  the  present  time. 

In  sanctioning  the  maintenance  of  the  existing  schedule  for  a  limited  period 
the  committee  wishes  it  to  be  understood  that  the  prices  enumerated  in  that 
schedule  are  not  indorsed  as  just  and  reasonable,  but  only  as  maximum  prices, 
not  to  be  exceeded  under  any  conditions  during  the  period  stated.  It  is  not 
recommended  by  any  implication  that  these  prices  must  now  be  paid  by  the 
Government,  by  the  Allies,  or  by  the  public. 

It  is  agreed  on  the  recommendation  of  the  manufacturers  that  certain  errors 
in  the  yarn  schedule  be  corrected  and  that  differentials  be  investigated,  and  if  any 
of  them  are  found  out  of  line  with  basic  prices,  be  revised  to  more  fairly  conform 
to  the  general-  profit  return  on  other  cotton  goods.  All  sales  made  after  Novem- 
ber 16  shall  be  subject  and  shall  conform  to  any  revisions  made  under  this 
paragraph.1 

At  a  meeting  of  the  j>rice-fixing  committee  on  November  14,  1918,  the  provision 
in  the  schedule  of  August  7,  1918,  to  the  effect  that  sales  in  ginghams  should  be 
made  only  for  delivery  prior  to  April  1,  1919,  was  canceled. 

1  Official  Bulletin,  Nov.  16,  1918. 


684 


HISTORY   OF  PRICES   DURING   THE   WAR. 


Sales  of  this  commodity  as  well  as  of  any  other  cotton  commodity  may  be 
made  for  any  delivery  period  agreed  on  between  buyer  and  seller  at  prices 
under  no  circumstances  in  advance  of  the  published  schedules.1 

On  December  12,  1918,  differentials  were  fixed  on  yarns  and  twine  covering 
sales  made  from  November  17,  1918,  to  January  1,  1919. 

The  fixed  prices  of  cotton  goods  expired  by  limitation  on  January  1,  1919. 

The  schedules  of  differentials  are  attached  below.  The  commodities  are  ar- 
ranged alphabetically,  and  the  prices  under  each  commodity  are  arranged 
chronologically. 

BANDAGE  CLOTH. 
(Sept.  25,  1918.) 


Width 
(inches). 

Yards  per 
pound. 

Sley  and  pick. 

Cents  per 
yard. 

33 

8 

28 

' 
8.77 
9.87 
10.52 
11.28 

44  by  40 
44  by  40 
44  by  40 
44  by  40 

1 

COTTON  BLANKETS. 

STAPLE  BLANKETS. 
(Aug.  16,  1918.) 


Made  of  American  cotton  with  standard  binding  and  packing,  maximum  price  of  the  equivalent  of  $3.07| 
per  pair  net  cash  at  mill,  based  on  si/e  of  04  by  70  inches,  weighing  about  2J  pounds  per  pair,  finished  in 
gray,  white  or  tan  with  usual  border. 

WOOL  FINISHED  BLANKETS. 
(Aug.  16,  1918.) 

Made  partly  of  foreign  cotton,  with  standard  binding  and  packing,  maximum  price  the  equivalent  of 
$3.75  per  pair,  net  cash  at  mill,  based  on  size  00  by  80  inches,  weighing  about  3J  pounds  per  pair,  finished 
in  gray,  white,  or  tan  with  usual  border. 

All  other  constructions,  designs  and  colors  in  both  the  so-called  "Staples"  and  "Wool  finish"  variety 
to  be  based  on  the  above  standard  prices.  Special  binding  or  packing  can  be  priced  extra. 

JACQUARD  BLANKETS. 
(Aug.  16,  1918.) 

Made  partly  of  foreign  cotton  and  woven  on  jacquard  looms,  with  standard  binding  and  packing,  max- 
imum price  the  equivalent  of  $1.35  per  pound  net  cash  at  mill.  Special  binding  or  packing  can  be  priced 
extra. 

DUGOUT  BLANKETS,  AMERICAN  COTTON,  QUARTERMASTER  CORPS,   NO.   127. 


We  ght. 

Size  (inches). 

Sley  and  pick. 

Price  per 
blanket. 

34  pounds                         

48  by  84 

(Oct.  17,1918.) 
45  by  55,  wool  finish  

$3.50 

85  pounds 

48  by  84 

American  cotton 

4  55 

3|  pounds  

48  by  84 

do  

4.00 

1  Price-Fixing  Committee,  Minute  Book  XI,  Nov.  15,  1918. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


685 


HEAVY    CHAMBRAYS,    CHEVIOTS,    COTTON    PLAIDS,    AND    KINDRED    COLORED 
FABRICS,  SEPTEMBER  3,  1918. 

Class  1  :  Lakewood,  25  inches,  6.10  plaids,  at  15^  cents,  terms  2/10-60  extra,  delivery 
at  mill — no  freight  (which  figures  net  to  mill  15.03£  cents). 

Class  2:  Riverside,  27  inches,  4.60  plaids,  at  20£  cents,  terms  2/10-60  extra,  delivery 
at  mill — no  freight  (which  figures  net  to  mill  19.88|  cents). 

Class  3  :  Pilot  junior  shirting,  28  inches,  4.30  Chambrays,  at  22  cents,  terms  2/10-60 
rxtra,  delivery  at  mill — no  freight  (which  figures  net  to  mill  21.34  cents). 

Class  4  :  Massachusetts,  26  inches,  3  suitings,  at  29  cents,  terms  2/10-60,  delivery  at 
mill — no  freight  (which  figures  net  to  mill  28.13  cents). 

Class  5  :  Otis  indigo  checks,  30  inches,  3.50  checks,  at  28  cents,  terms  2/10  extra,  de- 
livery at  mill — no  freight  (which  figures  net  to  mill  27.16  cents). 

Class  6  :  Massachusetts  K.  F.  C.,  32  inches,  3.10  shirting,  at  31  cents,  terms  2/10-60 
extra,  delivery  at  mill — no  freight  (which  figures  net  to  mill  30.07  cents). 

COUTIL. 

Sept.  25,  1918. 


Division. 

Width 
(inches). 

Weight. 

Sley  and  pick. 

Cents  per 

yard. 

Discount. 

Net  cash 
f.  o.  b. 

1918. 
No  1 

38 

2  73 

108  by  56 

31J 

Less  3  per  cent 

$0.  30565 

No  2 

38 

3  05 

100  by  56 

29 

do 

.2813 

No  3 

38 

2.25 

96  by  80 

37J 

....  do  

.3601 

No   4 

38 

2  15 

96  by  68 

36| 

do 

.3565 

No  5 

38 

2  15 

104  by  80 

38? 

do 

.3771 

No   G 

38 

1  85 

124  by  84 

45 

....  do  

.4365 

No  7 

38 

1  70 

104  by  80 

46J 

do 

.4486 

DENIMS. 
(Sept.  3,  1918.) 

Division  No.  1  :  Standard-Otis,  No.  3,  2.20  white  back  denim,  indigo.  Price  suggested, 
$0.3750  per  yard;  terms  2/10-60  days  dating,  delivery  at  mill,  no  freight  allowance 
(which  figures  net  to  mill  36.38  cents  per  yard). 

Comprising  this  division  are  all  white  br>ck  indigo-blue  denims. 

Differentials  suggested  as  follows  :  9-o  race,  1  cent  a  pound  less  than  2.20 ;  8-ounce, 
1  cent  a  pound  less  than  2.20;  2.40/2.50,  inclusive,  1|  cents  a  pound  more  than  2.20; 
2.55/2.75,  inclusive,  3  cents  a  pound  more  than  2.20  ;  3  and  lighter,  4  cents  a  pound  more 
than  2.20. 

Division  No.  2  :  Standard-Everett,  2.45  denim,  indigo.  Price  suggested,  33|  cents  per 
vard  ;  terms  2/10-60  days  dating,  delivery  at  mill,  no  freight  allowance  (which  figures 
net  to  mill  32.617  cents  per  yard). 

Comprising  this  division  are  all  double  and  twist  construction  denims. 

Division  No.  3  :  Standard-Proximity,  No.  31,  2.40  double  and  twist  indigo  denim.  Price 
suggested,  33.50  cents  per  yard  ;  terms  2/10-60  days  dating,  delivery  at  mill,  no  freight 
allowance  (which  figures  net  to  the  mill  32.50  cents  per  yard). 

Differentials  suggested  as  follows  :  2.60/2.65,  inclusive,  2  cents  a  pound  more  than  2.40  ; 
2.70/2.80,  inclusive,  3  cents  a  pound  more  than  2.40  ;  3  and  lighter,  4  cents  a  pound  more 

Brown  denims :  Recommendation  is  that  2  cents  per  pound  more  be  paid  for  brown 
denims  than  indigo  denims  in  all  corresponding  weights. 

Aniline  denims  :  Recommendation  is  that  price  be  2  cents  per  pound  less  than  indigo 
denims  in  all  corresponding  weights. 

GRAY  RED   STAR  DIAPER  CLOTH. 
(Sept.  25,  1918.) 


Width 

Yards  per 

Cents  per 

Cents  per 

(inches). 

pound. 

pound. 

yard. 

192 

6.75 

77 

11.41 

20i 

6.00 

76 

12.67 

24 

5.50 

75 

13.64 

26 

5.15 

75 

14.56 

It 

4.55 
4.15 

74 
73 

16.26 
17.59 

686 


HISTORY   OF  PRICES   DURING  THE   WAR, 
DRILLS. 


Width. 

Yards 
per 
pound. 

Sley  and  pick. 

Price  per 
pound 
on  basis 
estab- 
lished. 

Price  per 
yard 
suggested 

by 

experts. 

Inches. 
30 
30 
30 
30 
37 
37 
36 
37 
37 
•30 
30 

2.50 
2.50 
2.50 
3.25 
2.65 
2.35 
2.28 
3.95 
3.75 
3.00 
2.85 

July  25.  1918. 
72  by  60 
70  by  52 
68  by  48 
68  by  40 
68  by  40 
68  by  40 
66  by  56 
68  by  40 
68  by  40 
68  by  40 
71  by  46 

Cents. 
60.60 
58.73 
57.48 
60.62 
61.00 
58.86 
60.41 
69.29 
67.67 
59.22 
59.85 

Cents. 
24* 
23* 
23 
18| 
23 
25 

ft 

18 
19f 
21 

3-LEAF  WIDE  DRILLS. 

40 

52 
58 
59 
59 

2.40 

1.90 
1.60 
1.85 
1.94 

68  by  40 
July  25,  1918. 
68  by  40 
68  by  40 
58  by  40 
68  by  40 

60.94 

61.79 
60.41 
63.56 
64.59 

25f 

32.V 
37| 

DRILLS. 

40 

37 
37 

t? 

3.96 

3.25 
3.50 

2.40 
2.00 

Aug.  7,  1918. 
68  by  40 
Aug.  14,  1918. 
68  by  40 
68  by  40 
Oct.  25,  1918. 
86  by  52 
68  by  56 

18 

31 
3 

GRAY  DRILLS. 

30 
30 
30 
30 
30 
30 
33 
34i 
36 
37 
37 
49 
52 
52 

it* 

56 
60 

2.45 
2.50 
3.00 
4.00 
4.25 
5.25 
2.50 
2.38 
2.00 
2.75 
3.00 
.68 
.75 
.75 
.70 
.70 
.70 
.53 

Nov.  8,  1918. 
76  by  60 
68  by  56 
68  by  44 
68  by  40 
84  by  48 
60  by  50 
72  by  48 
68  by  56 
68  by  56 
68  by  40 
68  by  40 
72  by  48 
64  by  38 
68  by  42 
68  by  42 
70  by  44 
70  by  44 
70  by  44 

24f 
233 
20i 
16 
16f 
13 
24 
25 
281  • 

22  r 

2L 

1JA 

i 

I 

40 

GOVERNMENT  REGULATIONS  RELATING  TO  PRICES. 


687 


DUCKS. 
(July  1,  1918.) 

Standard  wide  and  sail  duck,  37J  per  cent  and  5  per  cent  from  list. 
Standard  Army  duck,  33  per  cent  from  list. 

ENAMELING  DUCKS. 


Width 
(inches). 

Yards  per 
pound. 

Sley  pick. 

Cents  per 
pound. 

51i 

1.38 

July  25,  1918. 
84  by  30 

61 

38 
46i 
56i 

2.00 
1.44 

84  by  30 
84  by  30 
84  by  30 

62 
61 
62 

61 

84  by  30 

63 

72 

84  by  30 

64 

PLAT    SINGLE    FILLING    DUCKS. 


29 
29 

8.00 
8.00 

July  25,  1918. 
76  by  28 
0) 

54 
55 

TWISTED   FILLING   DUCKS. 


29 
29 

8.00 
8.00 

July  25,  1918. 
76  by  28 
0) 

58 
59 

SHELTER    TENT    DUCK. 


Aug.  7,  1918. 

36 
35 

1.95 

38J 

62  by  62 
54  by  56 
Aug.  22,  1918. 

239 
236* 

35 
35 

1.94 
1.94 

54  by  56 
62  by  62 

75 

78.9 

1  84   or  over  by   28.          2  Per   yard.          3  Ounces. 

(The  price  as  published  under  Aug.  7,  1918,  is  in  error  ;  quotation  of  Aug.  22,  1918,  is 
correct.) 

I  REGULAR  HOSE  AND  BELTING  DUCK. 

(Aug.  7,  1918.) 

Cents  per  pound. 

Ranging  from  12  ounces  to  36  ounces 58 

10-ounce  hose  duck 59 

(Sept.  26,  1918.) 

Hose  and  belting  duck 621 

10-ounce  hose  duck 64f 

Wide  and  sail  duck,  37i  per  cent  discount  from  standard  list. 

Standard  Army  duck,  31  £  per  cent  discount  from  standard  list. 

Single  filling  duck,  classes  A,  B,  and  C. 

Double  filling  duck,  classes  A,  B,  and  C. 

These  classifications  are  described  as  follows  : 

Class  A  :  To  be  duck,  made  of  white  cotton,  without  waste  or  strips,  and  counting  not 
under  80  by  28.  Also  qualities  equal  to  Magnolia  and  Lindale  to  be  in  this  class. 

Class  B  :  To  be  duck,  *>f  all  clean  cotton,  and  counting  not  under  72  by  28.  This  class  is 
recognized  as  the  standard  grade  of  single  filling  duck. 

Class  C  :  To  be  duck,  made  to  count  not  under  72  by  28,  and  containing  not  over  25  per- 
cent of  waste  or  strips. 


688 


HISTORY  OF  PRICES  DURING  THE  WAR. 


FLANNELS. 
(Sept.  25,  1918.) 

MITTEN  FLANNELS. 


Weight  (ounces). 

Cents  net  at  mill. 

Cents  per  yard. 

3 

24.92 

25? 

6 

27.34 

28J 

7 

31.22 

32} 

8 

35.75 

36? 

10 

44.69 

46J 

9 

40.17 

41| 

11 

49.31 

50| 

12 

53.76 

13 

58.13 

59| 

14 

62.72 

64| 

CANTON  FLANNELS. 


Width 

Yards  per 

Cents  net  at 

Cents  per 

(inches). 

pound. 

mill. 

yard. 

30 

2.75 

26.91 

27| 

28 

2.95 

25.25 

26 

28 

4.00 

20.00 

201 

27 

5.00 

16.75 

m 

Lighter  weights  up  to  7  in  general  proportion. 

FLANNELETTES. 

(Sept.   3,   1918.) 

Division  No.  1 :  Cents  per  yard. 

1921  light  stripes,  checks,  and  plaids „  _  25.  81 

1921  dark  fancies  and  grays,  North  State  light  stripes,  checks,  and  plaids- _   _   25.  81 

North  State  dark  fancies  and  grays _   27  81 

Swiss  light  stripes,  checks,  and  plaids _   25.81 

Swiss  dark  fancies  and  grays 27  81 

Division  No.  2  : 

Smyrna  light  stripes,  checks,  and  plaids 23.  08 

Smyrna  dark  fancies  and  grays 23  08 

Saluda  light  stripes,  checks,  and  plaids 23.08 

Saluda  dark  fancies  and  grays ; _  25  08 

Division  No.  3  : 

Rutherford    flannel 32^  86 

Special    Government   flannel 32T  86 

Division  No.  4  : 

Pine 23.  00 

Portage 23.  00 

Division  No.  5  : l 

Daisy   bleached 27.  75 

Daisy    colors _  28.  75 

Malta    bleached 27.  75 

Malta    colors _   28.  75 

Division  No.  6  :  * 

Cashmere    bleached 24.  11 

Cashmere    colors 25.  11 

1921  bleached 24.  11 

1921    colors 25.11 

Division  No.  7  : 1 

Persian   bleached 21.  06 

Persian  colors 22.  06 

Defender  bleached 21.  06 

Defender   colors 22.06 

Division  No.   8  :  2 

1,501   bleached 33.  43 

900   bleached r 33.  43 

(Maximum  price,  Aug.  7,  1918.) 

Cents  per  yard. 

Division   No.    1  :   Toile  du   Nord,  Amoskeag  A,   F,   C,   Bates  seersucker,   Glonkirk 

zephyrs,   red   seal   sephyrs 23.  28 

Division  No.  3  :  Amoskeag  utility,  York  dress  gingham,  red  rose  Lancaster,  apple- 
web 21.  34 

Division  No.  4 :  Amoskeag  19000,  Berwick   chambray,  Kilburnie  gingham,  Yomac 

gingham,  white  pine  chevoit,  Essex  chambray 23.  28 

Division  No.  7:  Amoskeag  staples,  Lancaster  staples 18.92 

(Above  prices  are  all  net  cash  at  mill.) 

1  These  prices  are  based  on  bleached  and  light  colors  only.     Differential  to  be  given  for 
darks  and  special  shades. 

2  These  prices  are  based  on  bleached  only.     Differential  to  be  given  for  darks  and  special 
shades.     Prices  are  all  net  to  mill,  with  no  freight. 


GOVERNMENT  REGULATIONS   RELATING   TO   PRICES. 


689 


3-LEAF  JEANS. 
(Aug.  7,  1918.) 


Width 
(inches). 

Yards  per 
pound. 

Sley  and  pick. 

Cents  per 
yard. 

39 
39 
39 

2.75 
3.00 
3.10 

96  by  64 
96  by  64 
96  by  64 

27* 
26 
25i 

GRAY  3-LEAF  JEANS. 
(Aug.  16,  1918.) 


39 
39 
39 

3.10 
3.00 
2.75 

96  by  64 
96  by  64 
96  by  64 

% 

27* 

When  bleached,  price  of  these  goods  to  be  increased  1£  per  cent. 

OSNABURGS. 

PART  WASTE   OSNABURGS. 


Weight 
(inches). 

Weight 
per  yard 
(ounces). 

Sley  and  pick. 

Cents  per 
yard. 

(Aug.  14,  1918.) 

30 

7.00 

39  by  30                   22i 

30 
29i 
32 

8.00 
3.33 

1.88 

39  by  34 
34  by  34 
32  by  28 

1 

261 

34 

1.77 

32  by  28 

28} 

36 

3.00 

32  by  28 

Sr 

36 

3.25 

32  by  28 

36 

3.60 

32  by  28 

151* 

36 
40 
40 
40 

3.90 
1.60 
2.00 
2.28 

32  by  28 
32  by  28 
32  by  28 
32  by  28 

14} 

1 

22| 

40 

3.25 

32  by  28 

17 

40 

3.50 

32  by  28 

16 

40 

3.00 

36  by  36 

181 

CLEAN  OSNABURGS. 


(Nov.  8,  1918.) 

36 
36 

3.00 
3.25 

32  by  28 
32  by  28 

I? 

36 

40 

3.80 
2.00 

32  by  28 
38  by  36 

15 
27 

(Nov.  9,  1918.) 

40 

2.28 

32  by  28 

23i 

CARDED  CLOTHS. 

PLAIN    CAUDED   CLOTHS. 


(Aug.  16,  1918.) 

39 

5.00 

80  by  88 

22 

39 

6.00 

72  by  68 

183 

39 

6.00 

80  by  76 

19  a 

39 

5.25 

92  by  92 

24 

39 
39 

5.00 
4.95 

96  by  100 
96  by  104 

25f 
26 

40 

40 

9.00 
7.70 

72  by  60 
80  by  72 

15* 

18} 

(Nov.  8,  1918.) 

29 
36 
36 

13.33 
9.00  ' 
9.55 

56  by  52 
68  by  64 
72  by  68 

ll 

36 
36 

5.82 
6.25 

60  by  60 
80  by  80 

14* 

19| 

39 

8.70 

68  by  56 

40 

8.60 

72  by  68 

IfrjV 

40 

6.25 

88  by  80 

20$ 

40 

6.00 

88  by  80 

20^ 

40 

9.00 

72  by  60 

15* 

125547°— 20 44 


690 


HISTORY   OF  PRICES   DURING  THE   WAR. 
COMBED  YARN  FABRICS. 


Weight 
(inches). 

Weight 
per  yard 
(ounces). 

Sley  and  pick. 

Cents  per 
yard. 

(Sept.  3,  1918.) 

40 

10.50 

84  by  80 

28 

30 

12.00 

76  by  72 

28 

13.25 

68  by  64 

13i 

34 

6.40 

64  by  72 

21 

29 

7.50 

64  by  72 

18 

40 

9.50 

72  by  68 

20i 

40 

9.00 

76  by  72 

21g 

40 

8.50 

88  by  80 

25 

40 

7.00 

96  by  100 

29 

30 
34 

11.35 

7.00 

88  by  80 
72  by  100 

184 

24 

36 

21.00 

28  by  24 

7 

PLAIN  COMBED  CLOTH. 


(Nov.  8,  1918.) 

36 

10.25 

73  by  56 

16J 

36 

10.00 

72  by  60 

111 

38 

5.90 

96  by  125 

28| 

884 

7.75 

96  by  92 

27 

39 

11.00 

68  by  56 

17? 

40 
40 

6.50 
7.25 

108  by  112 
104  by  100 

32, 

30; 

40 

8.75 

100  by  96 

32j 

40 

6.00 

96  by  100 

28 

40 

9.35 

96  by  92 

33i 

40 

9.00 

80  by  80 

24^ 

40 

7.25 

96  by  92 

27^ 

SPECIAL  PONGEE  FABRIC. 
(Made  from  li-inch  cotton.) 


38 

4.85 

(Sept.3,1918.) 
60  by  72 

18* 

COMBED  PONGEE. 

(Nov.  8,  1918.) 

34 

5.20 

64  by  62 

22f 

34 
38 

5.80 
5.75 

64  by  60 
64  by  72 

22& 
20* 

PRINT  CLOTHS. 


(July  1,  1918.) 

38$ 

5.35 

64  by  60 

183 

38$ 

4.00 

80  by  80 

84 

(Aug.  7,  1918.) 

39 

4.00 

80  by  80 

2  21$ 

(Aug.  9,  1918.) 

39 

4.75 

68  by  72 

18 

39  - 

4.25 

72  by  76 

191 

38$ 

8.20 

(Aug.  14,  1918.) 
44  by  40 

38$ 

6.25 

60  by  48 

13J 

37$ 
39 

4.70 
4.50 

64  by  68 
64  by  88 

20 

39 

4.20 

64  by  104 

22 

39 

40 

6.60 
7.25 

56  by  44 
52  by  40 

1 

44 

6.40 

48  by  48 

13 

44 

7.25 

44  by  40 

11 

25 

10.55 

56  by  44 

1 

27 
27 

8.70 
7.60 

56  by  56 
64  by  60 

9 
11 

f 

31$ 

7.50 

56  by  52 

11 

31$ 

8.70 

48  by  48 

9, 

32 

6.20 

64  by  60 

13 

36 

11.30 

32  by  28 

7 

36 

7.75 

48  by  44 

10 

37$ 

4.70 

64  by  88 

19  J 

36 

21.00 

20  by  16 

4JL 

36 

13.00 

32  by  28 

6ii 

36 

17.00 

24  by  20 

5^ 

38$ 

5.35 

64  by  60 

15$ 

Per  pound. 


2  Correction. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 

PRINT  CLOTHS— Continued. 


691 


Width 
(inches), 

Sley  and 
pick. 

Price  per  pound  (cents). 

Cents  per 
yard. 

36 
36 
36 
36 
36 
36 
36 

20  by  12 
20  by  14 
26  by  22 
28  by  24 
32  by  24 
32  by  28 
36  by  32 

23.25  (34.6 
22.00  (34.8 
15.80  (35.2 
15.00  (36.2 
13.50  (35.1 
12.00  (33.4 
11  50  (36  3 

average  yarn) 
average  yarn)  . 
average  yarn)  . 
average  yarn) 
average  yarn) 

35 

51 

sff 

/A 

average  yarn) 
avfirapft  varn") 

7A 

7J 

36 

36  by  32 

11  20  (35  4  average  yarn) 

81 

36 
36 
36 

36  by  32 
40  by  32 
40  by  36 

10.50  (33.2  average  yarn) 
10.20  (34.1  average  yarn)  .  . 

9  65  (34  1  AVAratrfi  vaml 

g| 

8 

oTf 

36 
36 

44  by  36 
40  by  40 

9.20  (34.  l£ 
9.20   34.15 

iverage  yarn)  

93 

iveraee  varn)  .  .  . 

gV 

36 

44  by  40 

8.50  33.2  average  varn  'I  

10 

36 
36 

44  by  44 
48  by  40 

8.10   33.1  £ 
8.10  33.1  £ 

iverage  yarn)  .  .                          

IQrs 

iverage  yarn) 

36 
36 

48  by  44 
44  by  44 
8  by  8 
16  by  8 

7.75  (33.1  i 
8.40  (34.3  £ 
40.00  (30.1 
30.00  (33.9 

iverage  yarn)., 
iverage  yarn) 

11 

average  yarn) 
a  verapp,  varn  1  _  _ 

2  JL 

jY 

i 

Widths 
(inches). 

Sley  or  pick. 

Weight 
pei- 
yard. 

Price  per 
pound 
(cents). 

Cents 
per 
yard. 

(Aug.  14,  1918.) 

37 

40  by  36 

9.38 

34.1 

9 

38 

48  by  48 

7.15 

33.7 

Hi 

38 

56  by  44 

6.75 

33.1 

12 

38^ 

44  by  36 

8.50 

33.8 

9. 

I 

38i 

44  by  44 

7.65 

33,4 

10i 

38£ 

48  by  48 

7.15 

34.1 

11 

38^ 

52  by  40 

7.30 

33.4 

11 

.J 

60  by  52 

600 

33.4 

13 

64  by  55 

5.50 

32.8 

15 

64  by  64 

5.15 

32.8 

16, 

i 

39 

40  bv  28 

9.80 

33.5 

I 

i 

39 

40  by  32 

9.20 

33.3 

9 

39 

72  by  80 

4.50 

34.4 

19 

r 

40 

32  by  28 

10.80 

33.5 

7 

Ht 

40 

40  by  32 

9.10 

33.8 

9j" 

40 
40 

48  by  48 
56bv44 

7.00 
6.60 

34.7 
34.1 

& 

40 

56  by  56 

6.00 

34.7 

14 

k 

40 

64  by  64 

5.10 

33.7 

16- 

ft 

42 

32  by  28 

10.50 

34.2 

7 

1 

42 

44  by  40 

7.50 

34.1 

11 

i 

42 

33  by  44 

7.00 

33.4 

11 

4 

43 

40  by  32 

8.25 

33.0 

9 

43 

56  by  48 

5.85 

33.8 

14 

\ 

43 

56  by  52 

5.60 

33.6 

i 

44 

36  by  32 

8.50 

32.8 

9- 

ft 

44 

64  by  60 

4.65 

32.7 

17 

44 

64  by  64 

4.50 

32.7 

18- 

25 
25 

40  by  32 
40  by  36 

14.75 
14.00 

34.3 
34.3 

5- 
6 

1 

25 

40  by  36 

13.25 

32.5 

6 

1 

25 

44  by  44 

10.26 

29.1 

8 

rV 

25 

58  by  45 

11.00 

34.1 

7 

4 

27 

44  by  44 

9.50 

29.1 

8 

I 

27 

56  by  52 

9.00 

33.9 

9 

fr 

27 

56  by  44 

9.75 

34.0 

8 

>: 

27 

64  by  56 

7.85 

32.8 

10 

' 

28 

40  by  28 

13.50 

33.1 

6- 

28 

64  by  56 

7.50 

32.5 

11 

k 

28 

64  by  60 

7.30 

32.7 

11 

I 

29 

48  by  48 

9.70 

34.8 

9 

56  by  40 

8.45 

33.0 

9 

I 

32 

32  by  28 

13.50 

33.5 

6- 

•V 

32 

48  bv  48 

8.80 

34.9 

H 

32 

48  by  48 

8.50 

33.7 

1 

to 

34 

44  by  40 

9.40 

34.6 

? 

34 

48  by  48 

8.00 

33.7 

1 

>i 

34 

64  by  60 

6.00 

32.7 

1 

itt 

32 

64  by  60 

6.50 

33.3 

1 

*T 

28 

64  by  64 

7.00 

32.4 

1 

z| 

(Oct.  17,  1918.) 

44 

36  by  32 

8.50 

82.34 

9 

& 

692 


HISTORY   OF   PRICES   DURING  THE   WAR. 

SATEENS. 


Width 
(inches). 

Weight  per 
yard. 

Sley  and  pick. 

Cents  per 
yard  f.  o.  b. 
mill. 

53-54 

1.30 

(Aug.  30,  1918.) 
104  by  64 

53} 

(Oct.  25,  1918.) 

34 

3.00 

108  by  56 

24} 

31 

2.45 

112  by  64 

284 

31 
33} 

3.00 
2.15 

108  by  60 
118  by  76 

24| 

37% 
33} 

1.89 
2.15 

124  by  80 
118  by  72 

37f 

32* 

34 

3.00 

108  by  56                24} 

34 

3.00 

108  by  56                24} 

FILLING   SATEENS. 


GN  SATEEN. 


WARP  SATEEN. 


(Sept.  30.  1918.) 

26} 

6.85 

64  by  72 

12ff 

28 

5.85 

64  by  88 

15* 

31 

4.00 

72  by  120 

31} 
35 

5.50 
5.50 

64  by  88 
64  by  72 

is! 

35 

5.25 

64  by  80 

17  ' 

35 

4.65 

64  by  104 

2QA 

35 

3.75 

64  by  112 

23| 

36 

5.10 

64  by  80 

m 

36 

4.85 

64  by  88 

im 

36 

4.50 

64  by  96 

20^ 

373 

5.25 

64  by  72 

17 

87 

5.00 

64  by  80 

l&rV 

37i 

4.25 

64  by  96 

21r5 

37i 

4.00 

64  by  104 

37^ 

4.15 

64  by  112 

37< 

3.90 

64  bv  112 

39 
39 

4.75 
4.00 

64  by  80 
64  by  104 

j.«->4 

22* 

39 

4.00 

64  by  112 

39 

3.75 

64  by  112 

24J 

39 

3.80 

64  by  124 

24J 

37 

2.25 

(Oct.  20,  1918.) 
120  by  64 

91] 

40 

3.00 

(Sept.  25,  1918.) 
-    112  by  64 

2644 

42 

3.50 

112  by  64 

24ii 

42} 
42} 

4.00 
3.90 

96  by  56 
96bv60 

2% 

42} 

3.75 

96  by  64 

2244 

37} 

3.65 

112  by  64 

224} 

29 
37 

4.20 
3.50 

112  by  64 
112  by  64 

g? 

37} 

30} 

3.65 
4.00 

112  by  64 
112  by  64 

20? 

29 
30} 

4.20 
3.35 

112  by  64 
112  by  64 

22H 

30} 

3.30 

118  by  64 

23f 

30} 

3.00 

118  by  64 

25-A 

30} 

3.35 
2.65 

118  by  64 
118  by  64 

23A 
27J 

27} 

3.70 

112  by  64 

20H 

27} 

2.50 

96  by  56 

»* 

30 

2.85 

88  by  38 

21H 

GOVERNMENT  REGULATIONS  RELATING  TO   PRICES. 


693 


SATEENS -Continued. 

CARDED  WARP  SATEENS. 


Width 
(inches.) 

Weight  per 
yard. 

Sley  and  pick. 

Cents 
yard  f  . 
mi 

per 
o.  b. 

1. 

(Nov.  8,  1918.) 

% 

43 

3.00  ' 
2.75 
3.45 

114  by  84 
96  by  64 
140  by  96 

27  4 
27 
34 

53 
53i 

1.14 
1.22 

108  by  64 
108  by  64 

59j 

56 

54 

.30 

93  by  60 

52 

54 
54 

.05 
.05 

96  by  64 
85  by  64 

62 
63 

55 

.08 

93  by  60 

60J 

• 

55 

.18 

108  by  64 

58J 

i 

CARDED  FILLING   SATEENS. 


(Nov.  8,  1918.) 

38 

4.40 

80  by  124   |    28 

39 

39 

3.75 
3.20 

96  by  132 
72  by  120 

|i 

39 

3.50 

72  by  120 

23 

39 

3.75 

84  by  124 

30 

39 

3.50 

96  by  160 

3of 

39 

3.35 

96  by  160 

36^ 

r 

43 

3.35 

72  by  120 

29 

43 

3.35 

84  by  124 

33^ 

43 

3.35 

96  by  132 

37J 

43 

3.85 

64  by  104 

24 

43 

3.65 

64  by  112 

25 

COMBER  FILLING  SATEENS. 


(Nov.  8,  1918.) 

39 

3.35 

96  by  100 

444 

39 

4.25 

84  by  136 

33| 

39 

3.35 

96  by  136 

411 

I 

694 


HISTORY   OF   PRICES   DURING   THE   WAR. 
SHEETING. 


Width 
(inches). 

Weight  per 
yard. 

Sley  and  pick. 

Cents  per 
yard  f  .  o.  b. 
mill. 

(July  1,  1918.) 

36 

3.00 

48  by  48 

160 

36 

4.00 

56  by  60  • 

70 

(July  25,  1918.) 

36 

2.85 

48  by  48 

2  20J 

36 

3.00 

48  by  48 

20 

36 

3.25 

48  by  48 

181 

36 

3.50 

40  by  40 

17 

40 

2.85 

48  by  48 

21f 

38,36 

4.00 

48  by  52 

16f 

36 

4.00 

56  by  60 

36 

4.50 

48  by  52 

1  5i 

36 

5.00 

48  by  48 

14J 

36 

5.50 

48  by  44 

13l 

36 

6.00 

40  by  40 

HI 

36 

6.15 

44  by  40 

12 

31 

5.00 

48  by  48 

131 

36 

4.70 

48  by  52 

40 

5.00 

44  by  44 

14f 

40 

4.25 

44  by  40 

15£ 

40 

3.75 

48  by  44 

17$ 

(Aug.  7,  1918.) 

36 

3.60 

64  by  68 

20 

36 
36 

3.50 
3.70 

64  by  68 
64  by  68 

st 

40 

3.15 

64  by  68 

22f 

31 

5.00 

(Aug.  30,  1918.) 
48  by  48 

(Sept.  3,  1918.) 

40 
40 

2.50 
2.70 

48  by  48 
48  by  48 

1! 

40 

2.35 

48  by  48 

25 

32 

6.25 

40  by  40 

111 

36 

5.00 

64  by  64 

16 

31 

4.50 

44  by  44 

34 

6.00 

(Sept.  5,  1918.) 
40  by  40 

•m 

(Sept.  25,  1918.) 

40 

2.00 

40  by  40 

271 

GRAY    SHEETINGS. 


(Nov.  8,  1918.) 

26 

4.35 

48  by  48 

14f 

36 

2.95 

52  by  56 

21 

36 

3.15 

69  by  72 

22j 

36 

3.90 

40  by  38 

15^ 

36 

4.00 

48  by  48 

16 

40 

2.70 

44  by  44 

21 

40 

3.60 

56  by  60 

19 

48 

2.25 

48  by  48 

27, 

54 

2.00 

44  by  44 

30 

54 

2.00 

48  by  48 

31 

64 

2.25 

60  by  60 

321 

1  Cents  per  pound       2  Net  price.       3  Net  f.  o.  b.  mill.        <  F.  o.  b.  mill. 

WIDB   SHEETINGS. 

The  price  is  80  cents  per  pound  net  cash  f.  o.  b.  mill.  This  price  divided  by  the  weight 
of  the  11/4  brown  will  give  the  yardage  price  of  the  11/4  brown  and  10/4  bleached  ;  divide  1 
by  the  weight  of  10/4  brown  will  give  the  yardage  price  of  10/4  brown  and  9/4  bleached, 
and  so  on  through  the  various  widths. 

CARDED  OIL  CLOTH  SHEETING. 


Width, 
(inches.) 

Weight  per 
yard. 

Sley  and  pick. 

Cents  per 
yard  f  .  o.  b. 
mill. 

(Nov.  4,  1918.) 

51; 

.75 

40  by  40 

l"f 

51. 

51 

.50 
.25 

40  by  40 
40  by  40 

.    18J 
19 

51; 

.75 

44  by  40 

18 

51: 

.50 

44  by  40 

18| 

5li 

.25 

44  bv  40 

191 

58 

.25 

44  bv  40 

20J 

60 

4.18 

40  by  40 

201 

60 

3.65 

44  by  44 

22| 

GOVERNMENT  REGULATIONS  RELATING  TO   PRICES. 


695 


TICKING. 
(Sept.  25,  1918.) 

Class  1  is  Intended  to  coyer  the  various  blue  and  white  and  fancy  twill  tickings  in  the 
heavier  weights,  but  not  to  include  the  so-called  "  Straw  ticks  "  : 

32-inch,  8  ounces,  80  by  72,  class  1,  Cordis  A,  C.  E,  38.558  cents  net  to  mill. 
32-inch,  8  ounces,  80  by  70,  class  1,  A,  C,  A  Ainoskeag. 
32-inch,  2  ounces,  76  by  68,  class  1,  A,  O,  A  Eagle  and  Phoenix. 
32-inch,  8  ounces,  88  by  58,  class  1,  Bowling  Brook. 

Class  2  is  intended  to  cover  the  blue  and  white  and  fancy  twill  tickings  in  the  lighter 
weights,  known  as  "  Straw  ticks  "  : 

30-inch,  3.75  ounces,  73  by  40,  class  2,  Thqrndike  C,  20.13  cents. 
Class  3  is  intended  to  cover  the  sateen  tickings  in  all  weights  : 

33-inch,  8  ounces,  100  by  72,  class  3,  Conestogo,  R.  &  D.  and  B.  &  D.,  40.4975  cents. 
Class  4  is  intended  to  cover  the  hickory  stripes,  a  fabric  closely  affiliated  with  ticking, 
which  it  seems  best  to  include  : 

28Hnch,  2.85  ounces,  72  by  42,  class  4,  Thorndike  E,  8  by  4,  hickory  stripes,  27.16 
cents. 

PILLOW  TUBING. 
(Sept.  25,  1918.) 

The  yardage  price  of  the  bleached  cloth  is  to  be  found  by  dividing  85  cents  per  pound 
by  the  yards  per  pound  of  the  gray  cloth  from  which  it  is  made. 

TWILLS. 

4-LEAF   TWILLS. 


Width 
(inches). 

Yards  per 
pound. 

Sley  or  pick. 

Cents  per 
pound. 

Cents  i 
yard 

)er 

30 
30 
30 
30 
30 
30 
30 
30 
30 
59 

37 

2.00 
2.15 
2.31 
2.40 
2.50 
2.65 
2.85 
3-00 
3.25 
1.76 

1.75 

(July  25,  1918.) 
88  by  48 
88  by  48 
88  by  48 
88  by  48 
88  by  38 
88  by  38 
88  by  38 
88  by  38 
88  by  38 
76  by  44 
(Sept.  25,  1918.) 
86  by  44 

56.84 
57.91 
50.04 
59.68 
58.71 
59.90 
61.21 
62.20 
63.81 
62.94 

28 
27 
25 
24 
23 
22 
21 
20 
19 
35 

32 

r 

1 

& 

37 

2-00 

86  by  44 

29 

37 

2-10 

86  by  44 

28 

1 

37 

2-35 

76  by  42 

25 

37 

2.35 

84  by  42 

26 

1 

294 

2-65 

(Oct.  25,1918.) 
108  by  52 

25 

' 

30 

2.25 

108  by  52 

28 

T 

37 
29 

1.85 
2.00 

108  by  52 
(Nov.  8,  1918.) 
104  by  54 



34 
31 

, 

29J 

2.15 

104  by  48 

29 

i 

3  00 

84  by  37 

20 

29J 

2-50 

104  by  48 

.. 

% 

294 

2  50 

88  by  38 

23 

30 

2-00 

98  by  42 

29 

30 

2  00 

88  by  42 

28 

30 

2.20 

98  by  42 

27 

30 

2-31 

108  by  48 

28 

30 

2.70 

80  by  37 

215 

30 

3.00 

98  by  42 

22 

36 

1.90 

88  by  48 

31 

37 

1.50 

76  by  42 

37 

37 

1.75 

76  by  42 

32 

37 

1.83 

104  by  42 

34 

37 

2  00 

76  by  42 

29 

39 

1.90 

76  by  40 

31 

48 

1.54 

76  by  42 

37^ 

50 

1.48 

76  by  42 

39j 

58 

.96 

76  by  42 

59 

58 

1.30 

76  by  40 

45) 

58 

1.35 

68  by  56 

455 

59 

1.40 

48  by  64 

43i 

59 

2.00 

88  by  56 

37 

29J 

2.50 

(Nov.  9,  1918.) 
88  by  38 

23J 

30 

3.00 

98  by  42 

223 

59 

1.40 

48  by  64 

43i 

696 


HISTORY   OF   PRICES   DURING   THE   WAR. 


TWILLS—  Continued. 

3-LEAF  TWILLS. 

Width 
(Inches). 

Yards  per 
pound. 

• 
Sley  to  pick. 

Cents  per 
pound. 

Cents  per 
yards. 

37 
36 
38  i 
39 
39 
39 
39 
39 
43 
43 
43 
43 
43 

30i 
31 
31 
31 
39 
39 

39 

4.50 
4.20 
3.10 
5.10 
4.80 
4.50 
4.25 
4.00 
4.30 
4.50 
4.00 
6.00 
4.75 

3.85 
3.85 
4.00 
4.20 
3.25 
5.10 

5.10 

(Sept.  5,  1918.) 
96  by  60 
60  by  80 
96  by  64 
64  by  64 
64  by  72 
68  by  76 
68  by  76 
68  by  76 
68  by  60 
68  by  76 
68  by  76 
64  by  48 
68  by  52 

(Nov.  8,  1918.) 
68  by  76 
68  by  80 
64  by  72 
68  by  80 
68  by  76 
64  by  104 

Nov.  9,  1916.) 
64  by  104 

19J- 

1 

i*A 

•  19T 

m 

20| 
19| 
20 
21M 
14^ 

19J 

19j 

is; 
ti 

23 
23< 

23* 

ALBERT  TWILLS. 


35 

5.50 

(Sept.  9,  1918.) 
64  by  72 

35 

5.10 

64  by  80 

173 

35 

4  40 

64  by  80 

1QA- 

35 

4.85 

64  by  88 

jgi8 

35 

4.00 

(Nov.  8,  1918.) 
64  by  80 

19J 

35 

5.40 

64  by  72 

16 

35 

2.72 

72  by  120 

29J 

35 

38i 

3.00 
4.00 

72  by  120 
64  by  80 

27J 
20* 

40 

2.38 

72  by  120 

33J 

43 

2.22 

70  by  120 

35| 

Width 
(inches). 

Yards 
per 
pound. 

Sley  or  pick. 

Per 
pound. 

Cents 
per 
yard. 

30 

2.10 

(Julv  25,  1918.) 
88  by  56 

60.90 

29 

33i 

2.60 

(Oct.  25,  1918.) 
68  by  86 



26 

VENETIANS. 
(Sept.  3,  1918.) 


SINGLE   YAKN. 


41  cents  on  N-120,  35  inches,  156  by  64,  31.8: 

30/1  all  combed  rov.  twist  warp. 

33/1  all  combed  filling. 
43i  cents  on  N-261.  35  inches,  156  by  64,  2.85: 

30/1  all  combed  rov.  twist  warp. 

23/1  all  combed  filling. 


44  cents  on  P-322,  38  inches,  156  by  64,  2.90: 

30/1  all  combed  rov.  twist  warp. 

33/1  all  combed  filling. 
46f  cents  on  P-324,  38  inches,  156  by  64,  2.63: 

30/1  all  combed  rov.  twist  warp. 

23/1  all  combed  filling. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


697 


VENETIANS— Continued. 

SINGLE  YARN  COMBED  VENETIANS. 
(Nov.  4,  1918.) 


Width 
(inches). 

Yards  per 
pound. 

Sley  or  pick. 

Cents  per 
yard. 

35 
35 
36 
36 
37 
38 
38 
38 

3.10 
3.00 
3.00 
2.77 
2.80 
2.66     ~ 
2.75 
2.85 

156  by  64 
156  by  64 
156  by  64 
156  by  64 
148  by  64 
144  by  64 
156  by  64 
156  by  64 

41i 
42| 

44f 
44| 
46J 
46* 

44| 

TWO-PLY  WARP  COMBED  VENETIANS. 
(Nov.  4, 1918.) 


35 

38 

2.85 
2.63 

156  by  64 
156  by  64 

58 
60 

TWINE. 


WRAPPING    TWINB. 

(Aug.  14,  1918.) 

Prices  for  No.  1  quality  wrapping  twine  of  8's  or  coarser  yarn  : 

Cents 
per  pound. 

Any  ply  wound  on  cones  or  tubes,  packed  in  barrels  or  bales  or  in  cases,  in  bulk_     61 
Any  ply  wound  in  8-ounce  or  heavier  balls,  packed  in  barrels  or  cases,  in  bulk__     61& 
Any  ply  wound  in  small  balls  weighing  5  or  6  to  the  pound,  packed  in  barrels 
or  cases,  in  bulk  __  i  ___________________________________________________     62 

Any  ply  wound  in  small  balls  weighing  5  or  6  to  the  pound,  packed  in  5-pound 
or  10-pound  cotton-cloth  sacks  and  100  pounds  in  a  bale  _____________  _  ____     64 

Terms.  —  Prices  are  f.  o.  b.  cars  shipping  point,  net  cash  from  date  of  shipment  and 
include  cost  of  selling. 

(Dec.  12,  1918.) 

[Covering  sales  made  Nov.  17,  1918,  to  Jan.  1,  1919.] 
No  changes  made,  schedule  same  as  above. 

SEINE   AND    SAIL  TWINB. 

(Sept.  3,  1918.) 

For  United  States  standard  seine  twine  in  standard  skeins,  packed  in  bulk  or  in  5-pound 
or  10-pound  pads,  100-pound  bales,  basis  No.  15  to  42  medium  laid,  62  cents  per  pound. 
Differentials  on  other  sizes  and  lays,  as  at  present  established. 


For  winding  in  8-ounce  or  heavier  balls,  in  bulk,  1  cent  above  price  of  skeins. 

For  winding  on  1-pound  or  heavier  tubes,  in  bulk,  1  cent  above  price  of  skeins. 

For  winding  in  4-ounce  balls,  in  bulk,  2  cents  above  price  of  skeins. 

For  winding  in  2  to  3  ounce  balls,  in  bulk,  4  cents  above  price  of  skeins. 

For  packing  tubes  or  balls  in  5-pound  or  10-pound  muslin  sacks,  2  cents  above  price 
for  bulk  packing. 

Exact-weight  skeins,  4  ounces  or  heavier,  2  cents  above  price  regular  skeins. 

For  export  packing,  1  cent  above  price  regular  packing. 

For  broken  packages  of  lots   of  loss  than   100  pounds  of  a  size,   2   cents  above  price 
standard  packing. 

Sail  twine,   made  on  Brownell  or   Haskell-Dawes  twisters,   8-ply  and   up,  on   cones  or 
tubes  or  in  8-ounce  balls,  in  bulk,  63  cents  per  pound. 

Four-ounce  balls,  in  bulk,  1  cent  per  pound  aoove  8-ounee  balls. 

Balls  in  5-pound  or  10-pound  muslin  sacks,  2  cents  per  pound  above  bulk  packing. 
100-pound   bales  : 

Export  packing,  1  cent  per  pound  extra. 

Broken  packages,  2  cents  per  pound,  extra. 

Hose  cord,  made  of  12's  yarn,  Brownell  or  Haskell-Dawes  twisters,  64  cents  per  pound. 

Terms.  —  No  allowance  for  cones,  or  tubes,  net  cash,  f.  o.  b.  mill.     Seller  to  pay  cost  of 
selling. 


698  HISTORY   OF  PRICES   DURING  THE   WAR. 

(Dec.    12,   1918.) 
[Covering  sales  made  Nov.  17,  1918,  to  Jan.  1,  1919.] 

SEINE  TWINE. 

For  United  States  standard  seine  twine  in  standard  skeins,  packed  in  bulk  or  in  5- 
pound  or  10-pound  pads,  100-pound  bales,  basis  No.  15  to  42  medium  laid,  basis  price  to 
be  7  cents  per  pound,  over  fixed  price  10s  single-carded  yarn. 

Differentials  on  other  sizes  and  lays — as  at  present  established  by  leading  manufac- 
turers. 

Extras. 

For  winding  in  8-ounce  or  heavier  balls,  in  bulk — 1  cent  above  price  of  skeins. 

For  winding  in  1-pound  or  heavier  tubes,  in  bulk — 1  cent  above  price  of  skeins. 

For  winding  in  4-ounce  balls,  in  bulk — 2  cents  above  price  of  skeins. 

For  winding  in  2-ounce  to  3-ounce  balls,  in  bulk — 4  cents  above  price  of  skeins. 

For  packing  tubes  or  balls  in  5  pounds  or  10  pounds — 2  cents  above  price  for  bulk  pack- 
ing muslin  sacks. 

Exact  weight  skeins,  4  ounces  or  heavier — 2  cents  above  price  of  regular  skeins. 

For  export  packing — 1  cent  above  price  of  regular  packing. 

For  broken  packages  of  lots  of  less  than  100  pounds  of  a  size — 2  cents  above  price  of 
standard  packing. 

SAIL  TWINE. 

Sail  twine,  made  on  Brownell  or  Haskell  -  Dawes  twisters,  8  ply  and  up,  on  cones 
or  tubes  or  in  8-ounce  balls,  in  bulk — basis  price  to  be  7  cents  per  pound  over  fixed  price 
10s  single-carded  yarn. 

Four-ounce  balls,  in  bulk — 1  cent  per  pound  above  8-ounce  balls. 

Balls  in  5-pound  and  10-pound  muslin  sacks,  100-pound  bales — 2  cents  per  pound  above 
bulk  packing. 

Export  packing — 1  cent  per  pound  extra. 

Broken  packages — 2  cents  per  pound  extra. 

Hose  cord,  made  of  12s  yarn,  Brownell  or  Haskell-Dawes  twisters — 64  cents  per  pound. 

Terms. — All  sales  to  be  made  on  net-weight  basis,  net  cash,  f.  o.  b.  mill.     Seller  to  pay 

YARN  PRICES. 

(Aug.  14,  1918.) 
PRICES  FOR  CARDED  WARP  TWIST  YARNS,   MADE  FROM   NOT  BETTER  THAN  MIDDLING  UPLAND  COTTON. 

Single  yarn. 

Count:  (8  and    10    12    13      14    16      18    20      22      23      24      26      28      30      32      34      35    36 

below) 
Price:        57*      58    59    59*    60    61  *    63    64*    66*    67*    68*    70*    72*    74*    77*    80*    82    83* 

For  above  yarns  made  of  strict  to  good  middling  cotton  an  advance  in  price  of  2*  cents  per  pound  is  made, 
making  schedule  for  such  yarns  as  follows: 

Count:  (8  and    10      12      13     14      16     18      20    22     23     24    26    28    30    32    34    35      36 

below) 
Price:         60     '  60*    61*    62    62*    64    65*    67    69    70    71    73    75    77    80    83    84*    86 

For  above  yarns  made  of  staple  cotton  of  strict  to  good  middling  grade,  not  less  than  1^  inches  and  not 
over  1 J  inches,  an  advance  in  price  of  4  cents  per  pound  is  made  over  above  schedule,  making  prices  for  such 
yarns  as  follows: 

Count:  36    38    40    42    44    46        48        50 
Price:    90    92    94    96    98     1.00     1.02     1.04 

The  basic  price  is  on  No.  8  and  below: 

Over  Sand  not  over  10  rise  of  $  cent  per  number. 

Over  10  and  not  over  14  rise  of  J  cent  per  number. 

Over  14  and  not  over  20  rise  of  J  cent  per  number. 

Over  20  and  not  over  30  rise  of  1  cent  per  number. 

Over  30  and  not  over  36  rise  of  1*  cents  per  number. 
On  yarns  of  staple  cotton  in  counts  36  to  50  the  rise  is  1  cent  per  number. 

Ply  yarns. 

On  yarns  made  of  not  better  than  middling  upland  cotton  for  2  ply  to  7  ply  1  cent  per  pound  has  been 
added  to  the  single  yarn  prices  for  twisting  counts  8s  and  below  and  not  over  10;  1*  cents  per  pound  for 
counts  over  10  and  not  over  14;  2  cents  per  pound  for  counts  over  14  and  not  over  20;  2*  cents  per  pound  for 
counts  over  20  and  not  over  36,  making  prices  as  follows: 

Count:  (8  and    10    12      13    14      16      18    20      22    23    24    26    28    30    32    34    35      36 

below) 
Price:        58*       59    60*    61    61*    63*    65    66*    69     70    71     73    75    77    80    83     84*     86 

On  yarns  made  of  strict  to  good  middling  cotton  for  2  ply  to  7  ply,  1  cent  per  pound  has  been  added  to 
the  single  yarn  price  for  counts  8s  and  below  and  not  over  10;  1*  cents  per  pound  for  counts  over  10  and  not 
over  14;  2  cents  per  pound  for  counts  over  14  and  not  over  20;  2*  cents  per  pound  for  counts  over  20  and  not 
over  36,  making  prices  as  follows: 

Count:  (8  and     10      12    13      14    16    18      20    22      23      24      26      28      30      32      34    35    36 

below) 
Price-          61      61*    63    63*    64    66    67*    69    71*    72*    73*    75*    77*    79*    82*    85*  87   88* 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  699 


For  twisting  any  of  above  yarns  in  counts  8s  to  12s  in  plies  8  to  12  ply  an  advance  of  1  cent  per  pound  is 
made  over  prices  named  above  for  2  ply  to  7  ply  and  for  twisting  them  13  ply  to  60  ply  an  advance  of  1$ 
cents  per  pound  is  made  over  prices  named  for  2  ply  to  7  ply. 

For  Brownell  or  Haskell-Dawes  tube  twisted  yarn  in  counts  8  to  12  an  advance  is  made  of  4  cents  per 
pound  over  the  price  for  singles. 

On  yarns  made  of  strict  to  good  middling  staple  cotton,  not  less  than  1-rV  inches  and  not  over  1 J  inches, 
for  any  standard  ply  there  is  added  to  the  price  of  the  single  yarn  5  cents  per  pound  on  No.  10s  and  an 
additional  one-quarter  cent  per  pound  on  each  number  finer  than  10s,  making  the  following  prices: 

Count:  36         38        40         42        44         46        48         50 
Price:    1.01$    1.04    1.06$    1.09    1.11$    1.14    1.16$    1.19 

Form  of  delivery. — The  prices  named  above  are  for  commercial  skeins,  tubes,  cones,  and  section  beams 
of  standard  put  up. 


For  ball  or  chain  warps  1  cent  per  pound  extra  will  be  added. 
For  reverse  twist  5  cents  per  pound  adv 


ance  over  regular  twist  will  be  added. 


For  cabling  up  to  No. 

Terms.— Prices  include  the  weight  of  cones  or  tubes  on  which  yarn  is  wound'and  are  net  cash  from  date 
of  shipment  and  are  f.  o.  b.  cars  shipping  point.  Prices  include  cost  of  selling. 

PRICES  FOR  STANDARD  CARDED  HOSIERY  AND  KNITTING  YARNS  MADE  OF  WHITE  COTTON. 

For  single  yarns. 

Count:  (10  and    12    14    16      18    20      22      24      26      28      30 

below) 
Price:         61        62    63    64$    66    67$    69$    71$    73$    75$    77$ 

For  above  yarns  made  of  staple  cotton,  of  strict  to  good  middling  grade,  notless  than  1^  inches  and  not 
over  1£  inches  staple  the  following  prices  will  apply: 

Count:  (10  and    12    14    16      18    20      22      24      26      28      30      32      34      36      38      40 

below) 
Price:         65        66    67    68$    70    71$    73$    75$    77$    79$    81$    83$    85$    87$    89$    91$ 

The  basic  price  is  on  10s  and  below: 

Over  10  and  not  over  14,  rise  of  $  cent  per  number. 
Over  14  and  not  over  20,  rise  of  f  cent  per  number. 
Over  20  and  not  over  40,  rise  of  1  cent  per  number. 

For  ply  yarns  5  cents  is  added  to  the  price  for  No.  10  single  and  J  cent  per  pound  additional  per  single 
number  up  to  40s.  This  charge  for  twisting  these  high-grade  yarns  is  made  for  the  reason  that  yarns  used 
in  the  knitting  trade  require  more  perfect  manufacture  than  commercial  weaving  yarns.  They  require 
inspection  and  also  an  extra  process  called  doubling.  These  charges  are  based  on  actual  differential  costs 
of  mills  making  these  yarns,  making  the  following  schedule  for  twisted  yarns  of  standard  carded  hosiery 
and  knitting  quality  made  of  white  cotton: 

Count:"(10and    12      14    16    18    20    22      24    26      28      30 

below) 
Price:        66         67$    69    71     73    75    77$    80    82$    85    87$ 

And  the  following  schedule  for  twisted  yarns  made  of  staple  cotton  of  strict  to  good  middling  grade  not 
less  than  Ify  inches  and  not  over  If  inches  staple: 

Count:  (10  and    12      14    16    18    20    22      24    26      28    30      32    34      36    38         40 

below) 
Price:        70         71$    73    75    77    79    81$    84    86$    89    91$    94    96$    99    1.01$    1.04 

Form  of  delivery. — On  commercial  tubes,  cones,  cops, 
Terms— F.  o.  b.  cars  shipping  poii 
cones.    Prices  include  cost  of  selling 

BASED  ON  BASIC  PRICE  FOR  NO.  10  AND  BELOW,   GRADE   STRICT  TO  GOOD  MIDDLING. 

Combed  cotton  single  yarns. 

Length  of  staple.— Not  over  1A  Inches: 

Count:  (10  and    12    14    16      18    20      22    .24      26      28      30  . 

below) 
Price:        76          77    78    79$    81    82$    84    85$    87$    89$    91$ 

For  over  1^  inches  and  not  above  1J  inches,  5  cents  additional: 
Count:  (10  and    12    14    16      18    20      22    24      26      28      30      36          40 

below) 
Price:        81         82    83    84$    86    87$    89    90$    92$    94$    96$    1.02$    1.06$ 

For  over  1J  inches  and  not  above  1^  inches  to  1 J  inches,  5  cents  additional: 
Count:  (10  and    12    14    16      18    20      22    24      26      28      30 

below) 
Price:        86          87    88    89$    91    92$    94    95$    97$    99$    1.01$ 

Count:    36         40         45         50         55         60 
Price:     1.07$    1.11$    1.16i    1.21$    1.26$    1.31$ 


Terms.— F.  o.  b.  cars  shipping  point,  net  cash  from  date  of  shipment,  2  per  cent  allowance  to  be  made  for 
"ude  cost  of  selling. 


700  HISTORY   OF   PRICES   DURING   THE   WAR. 

For  over  1  \  inches  and  not  above  l^j  inches  to  If  inches,  10  cents  additional: 
Count:  (10  and    12    14    16      18        20         22        24         26         28 

below) 
Price:         96         97    98    99$    1.01    1.02$    1.04     1.05$    1.07$    1.09$ 

Count:    30         36          40          45          50         55          60          70         80 
Price:      1.11$    1.17$    1.21$    1.26$    1.31$     1.36$    1.41$    1.56$    1.71$ 

Basic  price  No.  10  and  below: 

Over  No.  10  and  not  over  No.  14,  $  cent  per  number  above  No.  10. 
Over  No.  14  and  not  over  No.  24,  |  cent  per  number  above  No.  14. 
Over  No.  24  and  not  over  No.  60, 1  cent  per  number  above  No.  24. 
Over  No.  60  and  not  over  No.  80, 1$  cents  per  number  above  No.  60. 

Form  of  delivery.— Hosiery  and  knitting  yarns  on  commercial  tubes,  cops,  cones  or  skeins  in  standard 
commercial  put  ups,  suitable  for  the  hosiery,  underwear,  and  regular  knitting  manufacturers. 

Warp  yarns  on  commercial  tubes,  cones,  skeins,  section  beams,  or  warps. 

Such  yarns  if  made  of  higher  twist  than  standard  warp  twist,  or  if  put  up  in  other  than  standard  forms 
for  delivery,  or  if  specially  made  for  special  work,  or  specially  inspected  for  removal  of  imperfections,  shall 
be  subject  to  such  additional  prices  to  cover  additional  costs  as  may  be  agreed  upon  between  the  buyer 
and  seller. 

All  figures  are  based  on  prices  net  cash  from  date  of  shipment  f.  o.  b.  cars  shipping  point,  for  yarns  de- 
livered at  net  weight  such  prices  to  include  the  cost  of  selling. 

BASED   ON  BASIC  PRICE  FOR  NO.  10  AND   BELOW,  GRADE  STRICT  TO  GOOD  MIDDLING. 

Combed  cotton  ply  yarns. 

For  twisting  5  cents  has  been  added  to  No.  10,  and  one-quarter  cent  additional  per  (single)  number  up 
to  80s. 

Length  of  staple.— Not  over  1-A  inches: 
Count:  (10  and    12      14    16    18    20    22    24    26      28      30 

below) 
Price:          81        82$    84    86    88    90    92    94    96$    99    1.01$ 

For  over  I,3*  inches  and  not  above  li  inches,  5  cents  additional: 

Count:  (10  and      12      14    16    18    20    22    24    26  28         30         36        40        45         50 

below) 
Price:        86  87$    89    91     93    95    97    99    1.01$    1.04    1.06$    1.14    1.19    1.25$    1.31$ 

For  over  li  and  not  above  1A  inches  to  1J  inches,  5  cents  additional: 
Count:  (10  and    12      14    16      18      20      22      24        26        28        30        36        40        45        50        55        60 

below) 
Price:    91   92$    94    96    98    1.00    1.02    1.04    1.06$    1.09    1.11$    1.19    1.24    1.30J    1.36J    1.42f  1.49 

For  over  11  inches  and  not  above  1A  inches  to  If  inches,  10  cents  additional: 
Count:  (10  and      12        14        16         18       20        22          24          26          28 

below) 

Price:       1.01       1.02$    1.04    1.06    1.08    1.10    1.12    1.14    1.16$    1.19 
Count:    30         36         40       45        50        55        60       70       80 
Price:    1.21$    1.29    1.34    1.40$    1.46$    1.52|    1.59    1.76$    1.94 

Form  of  delivery. — Hosiery  and  knitting  yarns  on  commercial  tubes,  cones,  or  skeins  in  standard  commer- 
cial put  ups. 

Warp  yarns  on  commercial  tubes,  section  beams  or  warps. 

All  figures  are  based  on  prices  net  cash  from  date  of  shipment,  f.  o.  b.  cars  shipping  point  for  yarns  de- 
livered at  net  weight,  such  prices  to  include  the  cost  of  selling. 

(Dec.  12, 1918.) 

Prices  for  carded  warp  twist  yarns,  made  from  Upland  cotton  below  the  grade  of  strict  middling. 

Single  yarn. 

Count:  (Sand      10      12    13    14    16      18    20      22      23      24     26      28      30      32      34      35      36 

below) 
Price:        57$        58    59    59$    60    61$    63    64$    66$    67$    68$    70$    72$    74$    77$    80$    82    83$ 

The  basic  price  is  on  No.  8  and  below: 

Over  8  and  not  over  10,  rise  of  \  cent  per  number. 
Over  10  and  not  over  14,  rise  of  $  cent  per  number. 
Over  14  and  not  over  20,  rise  off  cent  per  number. 
Over  20  and  not  over  30,  rise  of  1  cent  per  number. 
Over  30  and  not  over  36,  rise  of  1$  cents  per  number. 


Ply  yarns. 

For  2-ply  to  7-ply,  1  cent  per  pound  has  been  added  to  the  single  yarn  prices  for  twisting  counts  8s  and 
below  and  not  over  10:  1$  cents  per  pound  for  counts  over  10  and  not  over  14;  2  cents  per  pound  for  counts 
over  14  and  not  over  20;  2$  cents  per  pound  for  counts  over  20  and  not  over  36,  making  prices  as  follows: 


Count:  (Sand    10    12      13    14      16      18    20      22    23    24    26    28    30    32    34    35    36 

below) 
Price:      58$       59    60$    61    61$    63$    65    66$    69    70    71     73    75    77    80    83    84$    86 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES.  701 


For  twisting  any  of  the  above  yarns  in  counts  8's  to  12's  in  plies  8  to  12  ply  an 
advance  of  1  cent  per  pound  is  made  over  prices  named  above  for  2-ply  to  7-ply,  and  for 
twisting  them  13-ply  to  60-ply  an  advance  of  li  cents  per  pound  is  made  over  prices 
named  for  2-ply  to  7-ply. 

For  Brownell  or  Haskell-Dawes  tube  twisted  yarn  in  counts  8  to  12,  an  advance  is 
made  for  4  cents  per  pound  over  the  price  for  singles. 

Form  of  delivery.  —  The  prices  named  above  are  for  commercial  skeins,  tubes  cones 
and  section  beams  of  standard  put  up  : 

For  ball  or  chain  warps  1  cent  per  pound  extra  will  be  added. 

For  cabling  up  to  No.  30's  a  charge  of  6*  cents  per  pound  will  be  added  to  the  price 
of  single  yarn. 

Terms.  —  Prices  include  the  weight  of  cones  or  tubes  on  which  yarn  is  wound  and  are 
net  cash  from  date  of  shipment,  and  are  f.  o.  b.  cars  shipping  point.  Prices  include  cost 
of  selling. 

Prices  for  carded  warp-twist  yarns,  made  from  upland  cotton  that  will  grade  strict  to 
good  middling. 

Single  yarn. 

Count:    (8  and       10       12        13       14        16       18       20       22       23       24 

below) 
Price:          59  591      60*      61        61*      63        64|      66        68        69        70 

Count:   26     28     30     32     34      35     36 
Price:    72     74     76     79     82     83*   85 

The  basic  price  is  on  No.  8  and  below  : 

Over  8  and  not  over  10,  rise  of  4  cent  per  number. 
Over  10  and  not  over  14,  rise  of  *  cent  per  number. 
Over  14  and  not  over  20,  rise  of  1  cent  per  number. 
Over  20  and  not  over  30,  rise  of  1  cent  per  number. 
Over  30  and  not  over  36,  rise  of  1*  cents  per  number. 

Ply  yarns. 

For  2-ply  to  7-ply,  1  cent  per  pound  has  been  added  to  the  single  yarn  prices  for  twist- 
ing counts  8's  and  below  and  not  over  10;  1*  cents  per  pound  for  counts  over  10  and 
not  over  14  ;  2  cents  per  pound  for  counts  over  14  and  not  over  20  ;  2i  cents  per  pound 
for  counts  over  20  and  not  over  36,  making  prices  as  follows  : 

Count:    (8  and       10       12        13        14        16       18       20       22       23       24 

below) 
Price  :          60  60J      62        62|      63        65        662      68        70*      71*      72* 

Count:   26       28       30       32       34       35     36 
Price:    74*      76*     78*     81J     84*     86     87* 


SPECIAL. 


For  twisting  any  of  above  yarns  in  counts  8's  to  12's,  in  plies  8  to  12  ply  an  ad- 
vance of  1  cent  per  pound  is  made  over  prices  named  above  for  2-ply  to  7-ply,  and  for 
twisting  them  13-ply  to  60-ply  an  advance  of  11  cents  per  pound  is  made  over  prices 
named  for  2-ply  to  7-ply. 

For  Brownell  or  Haskell-Dawes  tube  twisted  yarn  in  counts  8  to  12,  an  advance  is 
made  of  4  cents  per  pound  over  the  price  for  singles. 

Form  tof  delivery.  —  The  prices  named  above  are  for  commercial  skeins,  tubes,  cones, 
and  section  beams  of  standard  put  up. 

For  ball  or  chain  warps,  1  cent  per  pound  extra  will  be  added. 

For  cabling  up  to  No.  30  a  charge  of  6*  cents  per  pound  will  be  added  to  the  price 
of  single  yarn.  • 

Terms.  —  Prices  include  the  weight  of  cones  or  tubes  on  which  yarn  is  wound  and  are 
net  cash  from  date  of  shipment,  and  are  f.  o.  b.  cars  shipping  point.  Prices  include  cost 
of  selling. 

Prices  for  standard  carded  hoisiery  and  knitting  yarns,  made  of  white  upland  cotton. 

Single  yarn. 

Count:   10  and     12     14     16       18     20       22       24       26       28       30 

below 
Price:          61        62     63     64*     66     67*     69*     71*     73*     75*     77* 

The  basic  price  is  on  10s  and  below  : 

Over  10  and  not  over  14,  rise  of  *  cent  per  number. 
Over  14  and  not  over  20,  rise  of  1  cent  per  number. 
Over  20  and  not  over  40,  rise  of  1  cent  per  number. 

For  ply  yarns  5  cents  is  added  to  the  price  for  No.  10s  single  and  \  cent  per  pound 
additional  per  single  number  up  to  40s.  This  charge  for  twisting  these  high-grade  yarns 
is  made  for  the  reason  that  yarns  used  in  the  knitting  trade  require  more  perfect  manu- 
facture than  commercial  weaving  yarns.  They  require  inspection  and  also  an  extra 
process  called  doubling.  These  charges  are  based  on  actual  differential  costs  of  mills 
making  these  yarns,  making  the  following  schedule  for  twisted  yarns  of  standard  carded 
hosiery  and  knitting  quality  made  of  white  cotton  : 

Count:   10  and     12        14     16     18     20     22       24    '26       28     30 

below 
Price:          66        67£     69     71     73     75     77*     80     82*     85     87* 

Form  of  delivery.  —  On  commercial  tubes,  cones,  cops,  or  skeins  in  standard  put  up. 

Terms.  —  F.  o.  b.  cars  shipping  point,  net  cash  from  date  of  shipment  for  yarns  deliv- 
ered at  net  weight.  Prices  include  cost  of  selling. 

Prices  for  carded  hosiery  and  knitting  yarns,  made  of  staple  cotton  of  strict  to  good  middling  grade 
not  less  than  l^ff  inches  and  not  over  1J  inches  staple. 


702  HISTORY   OF  PRICES   DURING   THE   WAR. 

Single  yarn. 

Count:  (10  and    12    14    16      18    20      22      24      26      28      30        32        34        36        38        40 

below) 
Price:         65        66    67    68$    70    71$    73$    75$    77$    79*    81$      83*      85$      87$      89*      91$ 

The  basic  price  is  on  10s  and  below: 

Over  10  and  not  over  14,  rise  of  f  cent  per  number. 
Over  14  and  not  over  20,  rise  of  f  cent  per  number. 
Over  20  and  not  over  40,  rise  of  1  cent  per  number. 

For  ply  yarns  5  cents  is  added  to  the  price  for  No.  10s  single  and  J  cent  per  pound  additional  per  single 
number  up  to  40s.  This  charge  for  twisting  these  high-grade  yarns  is  made  lor  the  reason  that  yarns  used 
in  the  knitting  trade  require  more  perfect  manufacture  than  commercial  weaving  yarns.  They  require 
inspection  and  also  an  extra  process  called  doubling.  These  charges  are  based  on  actual  differential  costs 
of  mills  making  these  yarns,  making  the  following  schedule  for  twisted  yarns  made  of  staple  cotton  of 
strict  to  good  middling  grade,  not  less  than  1-j^  inches  and  not  over  1 J  inches  staple. 

Count:  (10  and     12      14     16    18    20    22      24    26      28    30      32    34      36    38          40 

below) 
Price:        70          71$    73    75    77    79    81$    84    86$    89    91$     94    96$    99      1.01$    1.04 

Form  of  delivery. — On  commercial  tubes,  cones,  cops  or  skeins  in  standard  put  up. 

Terms.— F.  o.  b.  cars  shipping  point,  net  cash  from  date  of  shipment  for  yarns  delivered  at  net  weight. 
Prices  include  cost  of  selling. 

Prices  for  comber  cotton  single  yarns  based  on  basic  price  for  No.  10  and  below  grade  strict  to  good 
middling. 

Length  of  staple  not  over  1-^  inches. 

Count:  (10  and    12    14    16      18    20      22    24      26      28      30 

below) 
Price:         76         77    78    79$    81    82$    84    85$    87$    89$    91$ 

Five  cents  additional  for  over  1^  and  not  above  1J  inches. 

Count:  (10  and    12    14    16      18    20      22    24      26      28      30      36        40 

below) 
Price:        81          82    83    84$    86    87$    89    90$    92$    94$    96$      1.02$    1.06$ 

Five  cents  additional  for  over  1|  and  not  above  1-A  to  1J  inches: 

Count:  (10  and    12    14    16      18    20      22    24      26      28      30        36      40      45      50      65      60 

below) 
Price:        86     87    88    89$    91    92$    94    95$    97$    99$    1.01$    1.07$    1.11$     1.16$    1.21$    1.26$      1.31$ 

Ten  cents  additional  for  over  1±  and  not  above  !•&  to  If  inches: 

Count:  (10  and    12    14    16      18       20         22       24         26         28         30 

below) 

Price:          96        97    98    99$    1.01    1.02$    1.04    1.05$    1.07$    1.09$    1.11$ 
Count:  36         40         45         50         55         60         70         80 
Price:    1.17$    1.21$    1.26$    1.31$    1.36$    1.41$    1.56$    1.71$ 

Basic  price  is  on  No.  10  and  below: 

Over  No.  10  and  not  over  No.  14,  $  cent  per  number  above  No.  10. 
Over  No.  14  and  not  over  No.  24,  f  cent  per  number  above  No.  14. 
Over  No.  24  and  not  over  No.  60, 1  cent  per  number  above  No.  24. 
Over  No.  60  and  not  over  No.  80,  1$  cents  per  number  above  No.  60. 

Form  of  delivery.— Hosiery  and  knitting  yarns  on  commercial  tubes,  cops,  cones,  or  skeins  in  standard 
commercial  put  ups,  suitable  for  the  hosiery,  underwear,  and  regular  knitting  manufacturers. 

Warp  yarns  on  commercial  tubes,  cones,  skeins,  section  beams,  or  warps. 

Such  yarns,  if  made  of  higher  twist  than  standard  warp  twist,  or  if  put  up  in  other  than  standard  forms 
for  delivery,  or  if  specially  made  for  special  work,  or  specially  inspected  for  removal  ofjmperfections,  shall 
be  subject  to  such  additional  prices  to  cover  additional  cost,  as  may  be  agreed  upont>etween  the  buyer 
and  seller. 


All  figures  are  based  on  prices  net  cash  from  date  of  shipment  f.  o.  b.  cars  shipping  point  for  yarns 
jlivered  at  net  weight,  such  prices  to  include  the  cost  of  selling. 
Prices  for  combed  cotton  ply  yarns  based  on  basic  price  for  No.  10  and  below.    Grade:  Strict  to  good 


middling. 

(For  twisting,  5  cents  has  been  added  to  No.  10  and  one-quarter  cent  additional  per  (single)  number  up 
to  80s.) 

Length  of  staple,  not  over  1^  inches: 

Count:  (10  and      12      14    16    18    20    22    24    26      28    30 

below) 
Price:         82  82$    84    86    88    90    92    94    96$    99     101$ 

Five  cents  additional  for  over  1^  and  not  above  1J  inches: 

Count:  (10  and      12      14    16    18    20    22    24    26        28      30        36      40      45        50 

below) 
Price:         86          87$    89    91    93    95    97    99    101$    104      106$    114     119    125*     131$ 

Five  cents  additional  for  over  1£  and  not  above  1-tfj  to  1£  inches: 

Count:  (10  and       12      14     16     18    20      22      24      26        28      30      36      40      45        50        55        60 

below) 
Price:    91       92$    94    96    98    100    102    104    106$    109    111J      H9    124    130i     136$    142J        149 

Ten  cents  additional  for  over  li  and  not  above  1^  to  If  inches: 
Count:  (10  and      12       14      16      18      20      22      24      26 

below) 

Price:         101         102$    104    106    108    110    112    114    116$ 
Count:  28      30        36      40      45        50        55        60      70        80 
Price:    119    121$    129    134     140i    146$    152|    159    176$    194 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  703 

Form  of  delivery. — Hosiery  and  knitting  yarns  on  commercial  tubes,  cones,  or  skeins  in  standard  com- 
mercial put-ups. 

Warp  yarns  on  commercial  tubes,  section  beams  or  warps. 

All  figures  are  based  on  prices  net  cash  from  date  of  shipment  f.  o.  b.  cars  shipping  point  for  yarns 
delivered  at  net  weight,  such  prices  to  include  the  cost  of  selling. 

COTTON  LINTERS. 

On  May  2,  1918,  the  price-fixing  committee  of  the  War  Industries  Board 
established  the  price  for  Government  purchase  of  cotton  linters  of  munition 
grade  at  $4.67  per  hundred  pounds  f.  o.  b.  points  of  production.  All  prices 
were  made  operative  from  May  2,  1918,  to  August  1,  1919. 

On  July  8,  1918,  acting  upon  the  recommendation  of  the  chief  of  the  cotton 
linters  section  of  the  War  Industries  Board,  the  price-fixing  committee  fixed  the 
maximum  fee  for  the  bleaching  of  cotton  linters  at  $6.33  per  hundredweight. 
This  price,  subject  to  revision  October  31,  1918,  was  discontinued  at  that  time. 

On  July  10  the  War  Industries  Board  announced  the  following  policy  and 
regulations  concerning  cotton  linters : 

It  having  been  deemed  necessary  for  the  Government  to  take  over  all  the 
cotton  linters  now  in  existence,  irrespective  of  grade  or  ownership,  arrange- 
ments have  now  been  made  for  the  purchase  of  mattress  or  high-grade  linters 
which  were  produced  prior  to  May  2,  1918,  at  the  actual  value  of  the  commodity. 

Through  the  cooperation  of  the  United  States  Bureau  of  Markets  and  cotton 
and  cotton-products  section  of  the  War  Industries  Board,  three  samples  of 
linters  have  been  selected,  representing  types  of  linters  on  which  prices  have 
been  suggested  which  are  considered  fair  and  equitable,  both  to  owners  of  the 
linters  and  the  Government. 

The  Du  Pont  American  Industries  Co.,  of  Wilmington,  Del.,  as  the  purchasing 
agency  for  the  Ordnance  Department,  is  authorized  to  buy  the  linters,  as 
follows : 

Suggested 

Type  of  linters  designated  :  per^und. 

" A"    grade cents__  $0. 10 

"  B  "  grade do .  07 

"  C  "  grade do .  05^ 

All  prices  to  be  f.  o.  b.  points  of  location. 

It  is  suggested  that  by  agreement  between  the  inspector  acting  for  the  pur- 
chasing agency  of  the  Ordnance  Department,  and  the  owners  of -the  linters,  pur- 
chases can*  be  made  on  the  basis  above  suggested,  but  it  must  be  understood 
that  the  prices  named  are  not  obligatory,  or  by  authority  of  the  War  Industries 
Board,  but  are,  in  the  opinion  of  the  representatives  of  the  United  States 
Bureau  of  Markets  and  the  cotton  and  cotton  products  section  of  the  War  In- 
dustries Board,  acting  as  a  committee,  fair  and  just  prices  that  should  be  paid 
for  these  three  selected  grades. 

In  the  event  agreement  can  not  be  reached  between  the  inspector  and  the 
owner,  then  the  Ordnance  Department  may  exercise  its  right  to  commandeer, 
which  process  gives  the  owners  opportunity  to  establish  the  actual  value  of 
their  commodity  in  each  instance.  * 

All  linters  below  the  'grade  represented  by  type  "  C  "  shall  be  considered 
munition  linters,  and  the  price  of  $4.67  per  hundred  pounds  f.  o.  b.  points  of 
production,  established  as  of  May  2,  1918,  by  the  price-fixing  committee  of  the 
War  Industries  Board,  shall  apply. 

There  shall  be  only  one  grade  (munition  type)  of  linters  manufactured  dur- 
ing the  1918-19  season,  and  all  purchases  will  be  made  by  the  procurement  divi- 
sion of  the  United  States  Ordnance  Department. 

RULES  GOVERNING  THE  MANUFACTURE  OF  COTTON  LINTERS. 

Rule  1. — All  linters  cut  after  May  2,  1918,  to  be  of  munition  type,  running 
145  pounds  and  upward  per  ton  of  cotton  seed  crushed.  They  may  be  offered 
and  sold  only  through  the  Du  Pont  American  Industries  Co.,  acting  as  pur- 
chasing agents  for  the  procurement  division  of  the  United  States  Ordnance 
Department. 

Rule  2. — Linters  shall  be  produced  by  one  reginning  of  cotton  seed.  Such 
linters  must  be  reasonably  free  of  motes,  flues,  hull  linters,  hull  fiber,  hull 


704  HISTORY   OF  PRICES   DURING  THE   WAR. 

particles,  sweepings,  seed,  meats,  lubricating  oil,  excess  moisture,  and  all 
foreign  matter,  and  the  price  of  $4.67  per  hundred  pounds,  fixed  by  the  War 
Industries  Board,  as  of  May  2,  1918,  shall  apply  thereto. 

Ride  3. — Linters  contaminated  by  any  of  the  above-mentioned  foreign  mate- 
rials, or  linters  made  from  spoiled,  burned,  or  badly  damaged  seed  or  which 
have  been  otherwise  damaged,  will  be  accepted  by  the  Government's  authorized 
buying  agency  at  a  reduced  price.  If  the  producer  and  the  buying  agency 
can  not  agree  upon  a  price,  an  agreed  sample,  approved  by  both  the  producer 
and  the  buying  agency,  may  be  submitted  to  the  procurement  division  of  the 
United  States  Ordnance  Department  for  a  decision  as  to  price.  Such  decision 
shall  be  final. 

Rule  4- — The  making  of  two  cuts  of  linters  or  passing  the  seed  through  lint- 
ing  machines  a  second  time  is  prohibited. 

Rule  5. — Motes,  flues,  and  sweepings:  All  motes,  flues,  and  sweepings  must 
be  offered  for  sale  to  the  Government  buying  agency,  and  if  of  acceptable  grade 
will  be  purchased.  If  not  acceptable,  mills  may  then  apply  to  the  cotton  and 
cotton  products  section  of  the  War  Industries  Board  for  permit  to  sell  on  the 
open  market  such  rejected  motes,  flues,  and  sweepings  in  limited  specified 
quantities. 

Rule  6. — All  offerings  of  motes,  flues,  and  sweepings  must  be  in  not  less  than 
carload  lots. 

Rule  7. — All  raw  cellulose  produced  by  oil  mills,  whether  linters,  motes, 
flues,  sweepings,  hull  fiber,  or  other  fibrous  by-products  of  the  cotton  seed, 
shall  be  offered  for  sale  to  the  Government  buying  agency. 

Rule  8. — The  average  weight  of  bales  on  any  one  shipment  shall  not  be  less 
than  450  pounds  nor  more  than  550  pounds.  Tare  shall  not  exceed  7  per  cent. 
For  contract  purposes  it  shall  require  500  pounds  gross  weight  to  constitute 
one  bale.  All  bales  must  be  covered  sufficiently  and  properly  to  protect  the 
contents, 

Rule  9. — Beginning  August  1,  1918,  all  manufacturers  of  cotton  linters  will 
be  required  to  furnish  semimonthly  reports  as  of  the  last  working  day  prior 
to  the  first  and  fifteenth  of  each  month ;  these  reports  to  be  mailed  within  three 
days  after  the  end  of  each  semimonthly  period.  Reports  will  deal  with  raw 
material  and  finished  linters  along  the  lines  laid  down  in  the  reports  required 
by  the  United  States  Pood  Administration. 

These  rules  harmonize  with  Army  specifications. 

The  lifting  of  control. — The  Government  was  practically  under  the  obligation 
to  purchase  the  supply  of  linters  until  August  1,  1919.  Immediately  after  the 
signing  of  the  armistice,  however,  restrictions  for  the  manufacture  and  sale 
of  mattress  linters  were  removed. 

The  Ordnance  Department  made  an  arrangement  with  the  producers  of 
linters,  whereby  it  has  agreed  to  purchase  linters  to  the  amount  of  150,000  bales 
at  prices  of  10,  8,  and  5|  cents  in  the  event  that  this  amount  is  left  in  the 
hands  of  the  manufacturers  on  August  1,  1919. 

RATES  FOR  COMPRESSING  COTTON. 

On  November%5,  1918,  the  price-fixing  committee  announced  an  agreement 
which  it  had  made  with  the  cotton-compress  companies  at  the  request  of  the 
Railroad  Administration.  This  agreement  was  made  effective  November  4, 
1918,  to  expire  July  31,  1919.  The  compensation  agreed  upon  was  15  cents  per 
100  pounds  to  load  75  bales  per  36-foot  standard  car,  to  apply  to  all  points 
where  cotton  is  compressed.1 

KAPOK. 

(June  18,  1918-Jan.  17,  1919.) 

On  June  18,  1918,  the  War  Trade  Board  announced  that  the  importations  of 
kapok  would  be  restricted  to  purchases  for  Government  use,  and  that  import 
licenses  would  be  issued  through  the  textile  alliance.2  No  agreement  was  madt 

1  Price-Fixing  Committee  Minute  Book  X,  Nov.  4.  1918. 

2  War  Trade  Board  Ruling,  133. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  705 

as  to  price.     The  restrictions  of  the  War  Trade  Board  were  lifted  on  January 
17,  1919. 

On  August  20,  1918,  the  Bureau  of  Supplies  and  Accounts  of  the  Navy  noti- 
fied all  dealers  in  kapoc  that  restraining  orders  were  to  be  issued,  and  no  more 
sales  of  kapoc  were  to  be  made  to  the  public.  These  orders  became  effective  on 
September  20,  1918.  Navy  orders  were  then  placed  until  about  November  19, 
1918,  when  all  orders  were  released.2  A  provisional  price  which  averaged  about 
25  cents  per  pound  was  first  made,  but  the  final  price  paid  to  dealers  averaged 
slightly  over  30  cents  per  pound,  some  contracts  being  at  lower  prices  and  some 
at  higher.  Dealers  were  paid  on  the  basis  of  the  cost  to  them  of  the  kapok 
taken  by  the  Na-y. 

MANILA  FIBER. 

(Mar.  25,   1918-Aug.   31,   1918.) 

On  April  8,  1918,  the  War  Trade  Board  announced  that  all  purchases  of 
Philippine  manila  fiber  must  be  made  under  a  schedule  of  fixed  prices  for  the 
various  grades.  In  practice  there  were  two  schedules:  Schedule  A  was  the 
minimum  price  to  producers  in  the  Philippines  on  shipments  to  the  United 
States  or  elsewhere;  schedule  B  was  the  maximum  price  on  the  same  grades 
in  New  York.  Both  schedules  were  to  continue  in  force  for  four  months, 
beginning  March  25,  1918;  but  schedule  B  became  ineffective  about  June  20, 
1918. 

On  July  25,  1918,  the  price-fixing  committee  established  a  maximum  price 
of  14  cents  f.  o.  b.  Manila  for  grade  I  current  hemp.  The  prices  of  other  grades 
were  fixed  soon  after.  The  Government  agreed  to  pay  a  price  for  manila 
rope  based  upon  this  maximum  price  fixed  for  hemp.  This  schedule  lasted 
until  August  31,  1918,  after  which  no  price  control  was  exercised. 

SCHEDULE  A. 

HEMP    OR    MANILA    FIBER. 

Grade  A,  $30.75  per  picul  in  Manila,  equal  to  22  36  cents  per  pound. 
Grade  B,  $29.75  per  picul  in  Manila,  equal  to  21.63  cents  per  pound. 
Grade  C,  $28.87i  per  picul  in  Manila,  equal  to  21  cents  per  pound. 
Grade  D,  $28.12i  per  picul  in  Manila,  equal  to  20.45  cents  per  pound. 
Grade  E,,$26.87l  per  picul  in  Manila,  equal  to  19.54  cents  per  pound. 
Grade  F,  $25.62|  per  picul  in  Manila,  equal  to  18.63  cents  per  pound. 
Grade  I,  $23.371  per  picul  in  Manila,  equal  to  17  cents  per  pound. 
Grade  J,  $19.62|  per  picul  in  Manila,  equal  to  14.27  cents  per  pound. 
Grade  SI,  $25.62|  per  picul  in  Manila,  equal  to  18.63  cents  per  pound. 
Grade  S2,  $23.50  per  picul  in  Manila,  equal  to  17.09  cents  per  pound. 
Grade  S3,  $20.62J  per  picul  in  Manila,  equal  to  15  cents  per  pound. 
Grade  G,  $20.12|  per  picul  in  Manila,  equal  to  14.63  cents  per  pound. 
Grade  H,  $18.87J  per  picul  in  Manila,  equal  to  13.72  cents  per  pound. 
Grade  K,  $14.50  per  picul  in  Manila,  equal  to  10.54  cents  per  pound. 
Grade  L,  $13.50  per  picul  in  Manila,  equal  to  9.81  cents  per  pound. 
Grade  M,  $9.75  per  picul  in  Manila,  equal  to  7.09  cents  per  pound. 
Grade  DL,  $6.12J  per  picul  in  Manila,  equal  to  4.45  cents  per  pound. 
Grade  DM,  $4.25  per  picul  in  Manila,  equal  to  3.09  cents  per  pound. 

CEBU    MAGUEY. 

Grade  1,  $12.75  per  picul  in  Manila,  equal  to  9.27  cents  per  pound. 
Grade  2,  $11.50  per  picul  in  Manila,  equal  to  8.36  cents  per  pound. 
Grade  3,  $9  per  picul  in  Manila,  equal  to  6.54  cents  per  pound. 

MANILA    MAGUEY. 

Grade  1,  $12.25  per  picul  in  Manila,  equal  to  8.91  cents  per  pound. 
Grade  2,  $10.25  per  picul  in  Manila,  equal  to  7.45  cents  per  pound. 
Grade  3,  $8.50  per  picul  in  Manila,  equal  to  6.18  cents  per  pound. 

1  War  Trade  Board  Ruling,  523. 

2  In  releasing  orders  for  kapok,  the  Navy   no  longer  requisitioned  supplies  and  manu- 
facturers were  allowed  to  sell  their  stocks  on  the  open  market. 

125547°—  20 45 


706 


HISTORY   OF  PRICES   DURING  THE   WAR. 


SCHEDULE  B. 

HEMP    OR    MANILA    FIBER. 

Cents 
per  pound. 

A 32i 

B 3U 

C _  3o| 

D,  25  per  cent  over  good  current _  301 

D,  good  current 30 

E,  75  per  cent  over  fair  current iM)?, 

E,  62J  per  cent  over  fair  current '_          _  29J 

E,  50  per  cent  over  fair  current 29 

F,  37|  per  cent  over  fair  current _  28J 

F,  25  per  cent  over  fair  current 28 

I,   12J  per  cent  over  fair  current _  26i 

I,  fair  current , 26 

J,  50  per  cent  over  superior  seconds 23J 

SI ~  28 

S2    261 

S3 24 

G,  soft   superior  seconds ^ 24 

G,  soft  good  seconds 23^ 

H,  soft  reds _  22* 

K 19" 

L  _  18 

M::::::::::::::::__:::::::::::::::::::::::::::::::::::::::::::::::::::::I:  15 

DL__  12 

DM :__::::::  10 

CEBU    MAGUEY. 

Grade  1 17J 

Grade  2 16 

Grade  3 14 J 

MANILA    MAGUEY. 

Grade  1__  17 

Grade  2 15fc 

Grade  3 14 

MANILA  CONTROL   PRICES. 


Grades. 


A... 
B... 
C... 
D... 
E... 
F... 
G... 
H.. 
I... 
SI.. 
82.. 
S3.. 
J... 
K.. 
L... 
M.. 
DL. 
DM. 


Prices  in 
cents  per 

pounds 
fixed  Mar. 
25,  1918,  in 

Manila. 


22.36 
21.63 
21.00 
20.45 
19.54 
18.63 
14.63 
13.72 
17.00 
18.63 
17.09 
15.00 
14.27 
10.54 
9.81 
7.09 
4.45 
3.09 


Prices  in 
pesos  Mar. 
25,  1918,  in 

Manila. 


61.50 
59.50 
57.75 
56.25 
53.75 
51.25 
40.25 
37.75 
46.75 
51.25 
47.00 
41.50 
39.25 
29.00 
27.00 
19.50 
12.25 
8.50 


Prices  in 
pesos  July 
26, 1918.  in 

Manila. 


51.250 
49.625 
48. 125 
46. 875 
44.750 
42.750 
33.500 
31.500 
38.500 
42.750 
39.125 
34. 625 
34.000 
28.500 
27.000 
19.500 
12.250 
8.500 


The  above  are  all  first-cost  prices  per  picul  in  pesos. 

RAGS. 

(Aug.  19,  1918-Dec.  7,  1918.) 


Maximum  prices  for  rags  were  established  by  the  price-fixing  committee  on 
different  grades  of  rags,  under  three  dates  in  August,  1918.  Each  schedule  was 
to  remain  in  effect  until  October  1,  1918,  and  thereafter,  pending  the  compilation 
and  submission  of  cost  data,  by  the  Federal  Trade  Commission.  These  fixed 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES. 


707 


prices  were  net  f.  o.  b.  shipping  point  and  were  to  apply  to  sales  made  both  to 
the  Government  and  to  the  public. 

In  October,  1918,  new  prices,  lower  than  those  in  force  at  that  time,  wero 
established,  but  publication  was  withheld  and  the  prices  were  never  announced.1 


VARIOUS  GRADES  OF  RAGS. 
(Aug.  19,  1918.) 


Cents 

Grade.  per  pound. 

Mixed  softs 21J 

Blue  serge - 25 

Brown  serge 32 

Green  serge 32 

Red  serge 28 

Black  serge * 22 

White  softs 52 

White  flannels  and  serges 50 

White  knits 56 

Red  knits . 27J 

Blue  knits,  mixed 26J 

Silver  gray  knits 45 

Brown  knits 32 

Fancy  knits 21 

Black  dressed  knits 30 

Light  hoods 38 

Light  gray  underwear 16 

Fine  light  merinos 32 

Fine  dark  merinos 25 

Coarse  dark  merinos  with  serges 16 

Coarse  light  merinos  with  serges 24 

Thibets 28J 


Cents 
Grade.  per  pound. 

Rough  cloth 81 

Skirted  cloth,  ripped  from  rough  cloth_  11 J 

Skirted  cloth,  sorted  from  mixed  rags_  10 

Light  skirted  cloth 15J 

Black  and  white  skirted  cloth 17 

Fine  light  skirted  cloth 18J 

Brown  skirted  cloth 10 

Dark  skirted  cloth 8J 

Black  skirted  cloth 10 

Blue  skirted  cloth , 10 

Tan  skirted  cloth 25 

Light  skirted  worsted 25 

Blue  skirted  worsted - 21 

Black  skirted  worsted 22 

Brown  skirted  worsted 23 

Dark  skirted  worsted . 17 

Wool  carpets . 10J 

Soft-back  carpets.1 4| 

Mixed  linseys 41 

White  linsey  flannels 7 

Wool  bodies 81 

Skirted  delaines 6£ 


CLIPS 

(Aug.   21,   1918.) 

The  following  prices  were  to  be  paid  by  the  rag  collector  to  the  cutter-up. 
They  were  based  on  high  standard  of  grading  and  not  to  be  paid  for  inferior 
packing : 

MEN'S  WEAR.  Cents  per 

pound. 

Men's  black  and  blue  worsteds... 48 

Fine  clothing-house  clips,  light  weight 39 

Fine   merchant   tailor   clips 38 

Medium  clothing-house  clips,  light  weight 37 

Ordinary  clothing-house  clips,  including  cotton  warps 32 

All-wool    overcoating ' 23 

Medium  overcoatings  free  from  cotton  warps 20 

All-wool    mackinaws 17 

Mixed  overcoatings,  including  cotton  warps 10 

Cotton-warp    clothing    clips 5 

All-wool    flannels 25 

WOMEN'S  WEAR. 

Fine  cloak  and  suit  house,  light  weight  mixed  clips  including  serges 33 

Fine  cloak  and  suit  house,  light  weight  mixed  clips  without  serges 25 

All-wool  mixed  serges 40 

All-wool    cloakings 

Cotton  warp  serges 1 8 

Cotton  warp  cloak  and  suit  clips 5 

*A11  fixed  prices  were  discontinued  after  Dec.  7,  1918.  The  appended  schedules  of 
prices  were  issued  by  the  price-fixing  committee. 


708 


HISTORY   OF  PRICES   DURING  THE   WAR. 


NEW     WOOLEX     CLIPS. 


Cents  per 
Grade.                                            pound. 

Black  worsted 65 

Blue    worsted 62 

Blue- worsted    edges 50 

Brown  worsted 57 

Black  and  white  worsted 56 

Light  worsted 54 

Fine  light  worsted  and  clips 50 

Fine    lights 45 

Fine  dark  worsted 48 

Fine  dark  worsted  and  clips 47 

Fine    mixed    clips 44 

Mixed   dark   clips 40 

Mixed    clips . 35 

Medium    mixed    clips 32 

Heavy-weight  clips 

Coarse  dark  clips 23 

Coarse  light  clips 25 

Ordinary  light  clips 20 

Black  and  white 30 

Dark  gray  oxford 26 

Plain   black   clips '- 26 

Blue  uniform  clips   (without  edges) 38 

Fancy    mackinaw 20 

Union 8 

Light  union 11 

Light  blue  serge 52 

Black    serge 50 


Cents  per 
pound. 

50 

50 


Grade. 

Blue   serge 

Brown    serge 

Green  serge 50 

Red  serge 50 

Tan    serge GO 

Black  and  blue  serge  edges 35 

Dark  serge 35 

Light    serge 45 

White  serge 70 

Blue    cheviot 28 

Red  cheviot 28 

Brown  cheviot '. 28 

Green    cheviot 28 

Black    cheviot 28 

Light  blue  cheviot 28 

Tan  cheviot 35 

Light    homespun 35 

Medium    homespun 30 

Ordinary    homespun 25 

Light  flannel 35 

Blue  flannel 35 

Red    flannel 35 

Green  flannel 36 

French  flannel 27 

Mixed    flannel 25 

Black  flannel 33 


Grade. 


Cents 
per  pound. 


Reworked  wool  or  fiber. 
(Aug.  23.  1918.) 

These  prices  include  carbonizing,  picking,  and  carding.  If  dyeing  is  added, 
the  charges  must  not  exceed  5  cents  for  black  or  olive  drab  (khaki)  without 
special  permit  from  the  fiber  administrator. 

Cents 
Grade  per  pound. 

Coarse  light  merinos  with  serges 50 

Thibets 50i 

Light  skirted  cloth 39 

Black  and  white  skirted  cloth 42 

Fine  light  skirted  cloth 44J 

Brown  skirted  cloth 29 

Dark  skirted  cloth 27 

Black   skirted   cloth 29 

Blue   skirted   cloth 29 

Tan  skirted  cloth 48 

Light  skirted  worsteds 48£ 

Blue  skirted  worsteds 43 

Black  skirted  worsteds 44£ 

Brown  skirted  worsteds 46 

Dark  skirted  worsteds 39 

Wool  carpets 30 

Soft  black  carpets 331 

Skirted    delaines—  _  30 


Blue   serge 48J 

Brown    serge 58 

Green  serge 58 

Red  serge _ 55 

Black    serge ^ 44J 

White   softs 86 

White  flannels  and  serges 83 

White  knits 92 

Red  knits 59 

Blue  knits,  mixed 57 

Silver  gray   knits 93 

Brown    knits 66 

Fancy  knits 48J 

Black  dressed  knits 63 

Light  hoods 76 

Light  gray  underwear 50 

Fine  light  merinos 58J 

Fine  dark  merinos 48 

Coarse  dark  merinos  with  serges 38 


SILK. 

(Sept.  19,  1918-Dec.  20,  1918.) 

The  War  Trade  Board,  on  September  3,  1918,  voted  to  revoke  all  outstanding 
licenses  for  the  importation  of  silk  noils,  silk-noil  yarns,  garnetted  silk,  and  silk 
waste.  This  action  was  effective  for  shipments  after  September  10,  1918.1 

Importers  were  required  to  give  an  option  on  all  new  licenses  to  the  United 
States  Government.  The  United  States  Government  was  permitted  to  purchase 
these  restricted  commodities  at  a  price  2  per  cent  above  the  cost  at  the  foreign 
port  of  shipment,  as  shown  by  the  consular  invoice,  including  all  charges  except 
prepaid  freight  and  prepaid  insurance.  These  provisions  were  administered  by 
the  Silk  Association  of  America. 

The  ruling  of  the  War  Trade  Board  granting  this  option  to  the  Government 
was  rescinded  on  December  20,  1918.* 


1  War  Tr"ade  Board  ruling,  237. 


1  War  Trade  Board  ruling,  434. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  709 

WOOL. 

(Dec.    15,    1917-Jan.    1,    1919.)1 

The  formal  price  fixing  of  wool  began  on  May  1,  1918.  The  regulations  per- 
taining to  wool  prices  fall  under  one  or  another  of  the  following  heads  and 
are  so  arranged  in  this  compilation :  Government  regulations  for  the  importa- 
tion of  wool,  issued  by  the  War  Trade  Board ;  Government  regulations  for  han- 
dling the  1918  clip,  issued  by  the  War  Industries  Board ;  Government  wool 
prices  effective  May  1,  1918;  Government  issue  prices  to  manufacturers  holding 
Government  contracts. 

Disposal  of  Government  stocks. — On  December  9,  1918,  the  Director  of  Pur- 
chase and  Storage  of  the  War  Department  made  the  following  plan  for  dispos- 
ing of  the  Government  supplies  of  wool.  Limited  amounts  of  wool  were  to  be 
sold  from  time  to  time  at  public  auction.  A  minimum  reserve  price  was  estab- 
lished, below  which  no  bids  were  considered.  The  first  auction  was  held  on 
December  18,  19,  and  20,  1918.  Prices  offered  by  bidders  dropped  at  each 
auction,  and  on  January  24,  1919,  the  following  announcement  appeared : 

The  War  Department  authorizes  the  following  statement  from  the  office  of 
the  Director  of  Purchase,  Storage  and  Traffic : 

Many  inquiries  have  been  received  from  wool  dealers,  wool  growers,  and  wool 
manufacturers  in  regard  to  the  policy  of  the  Government  in  disposing  of  the 
stocks  of  wool  held  by  the  War  Department.  In  answer  to  these  inquiries,  the 
War  Department  states  as  follows: 

First.  It  is  the  intention  of  the  War  Department  to  continue  to  sell  at 
public  auction  such  wools  as  manufacturers  may  require,  with  a  minimum 
reserve  price  the  equivalent  of  the  British  civil-issue  price.  This  basis  of  the 
British  civil-issue  price  will  be  maintained  as  the  minimum  reserve  price  until 
July  1,  1919. 

Second.  It  is  not  the  intention  of  the  War  Department,  in  the  sale  of  wool 
now  owned  by  the  Government,  to  compete  with  the  domestic  producers  of 
wool.  It  is  the  intention  of  the  War  Department,  on  July  1,  1919,  when  the 
domestic  clip  will  probably  be  arriving  in  the  markets  in  sufficient  volume  to 
supply  the  wants  of  manufacturers,  to  discontinue  offering  at  auction  or  other- 
wise until  such  a  time  as  the  domestic  producer  shall  have  had  ample  oppor- 
tunity to  market  his  1919  clip,  November  1,  1919,  those  grades  of  wool  that 
would  compete  with  the  product  of  domestic  wool  growers  remaining  in  the 
hands  of  tile  Government.2 

Removal  of  import  restrictions. — Ruling  No.  426,  bureau  of  imports  of  the 
War  Trade  Board,  issued  on  January  8,  1919,  is  given  below: 

Wool,  icool  tops,  noils,  yarns,  and  waste. — On  and  after  January  10,  1919, 
licenses  may  be  issued  where  the  applications  therefor  are  otherwise  in  order 
for  the  importation  of  wool,  wool  tops,  noils,  yarns,  or  waste  from  any  non- 
enemy  country. 

Such  licenses  will  contain  the  provision  requiring  indorsement  of  the  bill  of 
lading  to  the  Textile  Alliance  (Inc.). 

The. Textile  Alliance  (Inc.)  will  no  longer  require  the  giving  of  an  option  to 
the  Government  to  purchase  the  commodities  imported. 

Hereafter  it  will  be  unnecessary  to  refer  to  any  applications  for  the  impor- 
tation of  these  commodities  to  the  office  of  the  Quartermaster  General. 

Under  the  foregoing  rules,  licenses  may  now  be  issued  to  importers  other  than 
the  Quartermaster  General  for  these  commodities  from  the  Argentine,  Uruguay, 
and  South  Africa.  Ruling  No.  208,  issued  July  12,  1918,  is  hereby  revoked. 

By  a  further  ruling  effective  April  29,  1919,  the  importation  of  wool  under 
a  general  import  license  was  permitted  from  all  countries  except  Germany, 
Luxemburg,  Hungary,  and  those  parts  of  Russia  under  Bolshevik  control. 

1  There  were  no   Government   purchases   of   the    1919   clip,   but   all   stocks   of  wool   on 
hand  at  the  time  of  the  armistice  were  disposed  of  by  the  War  Department. 

2  Federal  Trade  Information  Service,  Jan.  25,  1919. 


710  HISTORY   OF  PRICES   DURING  THE   WAR. 

REGULATIONS    FOR   THE   IMPORTATION   OF   WOOL. 

(Announcement,  Dec.  15,  1917.) 

The  War  Trade  Board  announces  that  the  following  regulations  will  apply  as 
of  December  15,  1917,  to  the  importation  of  wool  from-  all  foreign  sources : 

"  1.  Applicants  for  import  licenses  will  be  required  to  sign  an  agreement  con- 
taining the  following  provisions : 

"A.  The  applicant  agrees  that  he  will  not  sell  the  wool  covered  by  Applica- 
tion No. ,  or  any  other  wool  of  either  foreign  or  domestic  origin,  to  any 

person  other  than  a  manufacturer  without  the  consent  of  the  War  Trade  Board ; 
and  that,  in  the  event  of  a  sale  to  a  person  other  than  a  manufacturer  with 
such  consent,  he  will  exact  from  his  purchaser  a  similar  agreement. 

"  B.  The  United  States  Government  shall  have,  and  it  is  hereby  granted,  an 
option  to  purchase,  at  the  price  and  on  the  terms  hereinafter  set  forth,  all  or 
any  part  of  the  wool  covered  by  Application  No. ,  for  10  days  after  custom- 
house entry  thereof ;  and  thereafter  on  such  portion  thereof  as  shall  be  at  any 
time  unsold  until  the  whole  amount  thereof  has  been  sold  by  the  importer.  In 
the  event  of  the  exercise  of  such  option,  the  basis  of  price  to  be  paid  for  the 
wool  shall  be  equivalent  to  5  per  cent  less  than  the  basis  of  price  of  July  30, 
1917,  for  similar  wool,  as  established  by  the  valuation  committee  of  the  Boston 
Wool  Trade  Association,  the  actual  price  of  each  lot  to  be:'  determined  by  a  com- 
mittee to  be  appointed  jointly  by  the  Boston  Wool  Trade  Association  and  the 
United  States  Government. 

"2.  These  regulations  shall  not  apply  to  any  wool  purchased  abroad  on  or 
before  December  15,  1917." 

Applicants  for  import  licenses  will  therefore  file  with  their  first  application 
copies  of  all  their  contracts  outstanding  on  December  15,  1917,  for  the  impor- 
tation of  wool  from  foreign  sources,  and  as  to  which  all  wool  contracted  for  had 
not  been  entered  at  any  United  States  port  of  entry  December  15,  1917,  and 
showing  in  detail  the  amount  of  wool  already  shipped  and  the  amount  of  wool 
yet  to  be  shipped  thereunder. 

The  War  Trade  Board  in  fixing  the  effective  date  of  the  foregoing  regulations 
as  of  December  15,  1917,  had  as  its  object  the  avoidance  of  any  retroactive  effect 
which  would  be  burdensome  and  embarrassing,  and  earnestly  appeals  to  wool 
importers  and  to  manufacturers  of  woolen  products  so  to  conduct  their  transac- 
tions with  respect  to  the  stock  of  wool  now}  on  hand  and  the  importations  now 
en  route  that  further  speculation,  hoarding,  and  the  continuation  of  fictitious 
prices  may  be  avoided. 

It  is  hoped  that  the  effect  of  these  regulations  will  be  to  clarify  the  situation 
and  remove  the  causes  for  anxiety  which  have  occasioned  the  abnormal  and 
illogical  inflation  of  prices  for  that  commodity. 

The  price  of  wool  has  advanced  in  the  United  States  by  a  percentage  greatly 
in  excess  of  such  price  advances  in  other  countries.  The  price  in  England  is 
fixed  at  55  per  cent  in  excess  of  prewar  prices.  The  price  in  the  United  States 
has  advanced  200  per  cent  above  the  prewar  level.  It  is  true  that  the  demand 
for  wool  and  products  thereof  has  increased  as  a  result  of  the  military  needs 
of  the  United  States,  but  the  demand  in  other  countries  has  been  relatively  as 
great.  Those  countries,  however,  have  introduced  a  system  of  governmental 
control,  and  this  has  prevented  the  abnormal  inflation  which  the  absence  of 
such  control  invites  when  the  regular*  course  of  commercei  is  disturbed  by  war. 

Governmental  control  in  other  countries  has  allayed  the  sense  of  uncertainty 
as  regards  the  future,  which  in  this  country  has  become  almost  hysterical 
and  has  occasioned  speculation  between  importers.  Cloth  manufacturers  have 
been  impelled  by  fear  to  carry  abnormal  stocks  of  wool  and  to  contract  with 
dealers  or  importers  for  unusual  quantities  for  far  forward  delivery.  Manu- 
facturers of  clothing  have  also  been  infected  by  a  like  dread,  inciting  the  pur- 
chase of  cloth  exceeding  in  volume  their  reasonable  needs.  Such  processes  have 
brought  about  an  artificial  demand,  far  in  excess  of  actual  consumption,  the 
inevitable  effect  of  which  has  created  a  fictitious  price  condition.  This  has 
happened  at  a  time  when  the  wool  supply  in  the  country  is  known  to  be  ample 
for  present  needs  and  for  a  sufficient  period  in  advance  to  remove  any  reasonable 
apprehension  as  to  the  ultimate  available  supply. 

Statistical  data  collected  by  the  Government,  corroborated  by  independent 
investigations  of  the  wool  industry,  clearly  indicate  that  no  wool  shortage 
exists,  either  In  the  world's  supply  or  in  the  amount  on  hand  in  the  United 
States,  notwithstanding  the  increased  consumption  for  military  purposes.  The 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  711 

clip  in  most  countries  has  steadily  increased  since  the  outbreak  of  the  war, 
because  sheep  raisers,  stimulated  by  the  higher  returns  for  wool,  have  permitted 
the  flocks  to  increase,  and  it  may  be  reasonably  expected  that  this  increased 
production  will  continue. 

The  consumption  of  wool  during  the  year  1918  will  be  little,  if  any,  greater 
than  it  was  during  the  year  1917,  for  the  reason  that  textile  manufacturers  have 
been  producing  well  up  to  the  limit  of  their  reasonable  capacity,  and,  further, 
because  of  the  increased  use  of  substitutes  for  wool  in  manufacturing 
processes. 

The  Commercial  Economy  Board  has  begun  to  exert  its  influence  in  applying 
the  principle  of  conservation  to  the  consumption  of  wool,  and  will  continue 
to  induce  the  curtailment  of  its  use  for  less  essential  products ;  that  is  to  say, 
the  consumption  of  wool  will  be  directed  into  needful  and  withheld  from 
unnecessary  channels.  This  action  as  a  matter  of  course  will  tend  to  diminish 
the  consumption  and  further  to  maintain  the  present  safe  margin  of  supply. 

The  War  Trade  Board  has  invited  and  confidently  awaits  the  cooperation 
of  the  wool  dealers  and  the  cloth  and  clothing  manufacturers  of  the  country  in 
causing  the  abandonment  of  the  practice  of  far  forward  purchasing  and  the 
unnecessary  accumulation  of  stocks,  which  practice  a  mistaken  estimate  of 
the  wool  supply  of  the  country  and  of  the  world  has  incited  them  to  follow. 
Such  hoarding  is  evidently  dangerous,  because  of  the  resultant  price  inflation. 
The  continuance  of  this  practice  will  threaten  the  holders  of  abnormal  stocks 
or  those  who  are  committed  for  far  forward  deliveries  with  a  severe  loss  when 
the  inevitable  period  of  readjustment  in  commodity  values  is  at  hand. 

It  is  hoped  that  the  action  of  the  War  Trade  Board  in  providing  that  the  Gov- 
ernment of  the  United  States  may  take  advantage  of  the  option  contained  in 
all  import  licenses  issued  on  and  after  December  15,  1917,  to  purchase  importa- 
tions of  wool  at  a  price  5  per  cent  below  that  of  the  Boston  market  as  of  July 
30  last,  will  stabilize  the  market,  encourage  the  importations  of  wool  to  con- 
tinue in  the  accustomed  manner,  check  the  price  movement  toward  the  breaking 
point,  and  permit  of  an  orderly  recession  toward  a  less  dangerous  level.  The 
bringing  about  of  these  conditions  through  the  cooperation  of  the  trade  at  large 
with  the  War  Trade  Board  will  enable  the  various  interests  concerned  so  to 
adjust  their  operations  as  to  avoid  what  might  otherwise  lead  to  a  serious 
catastrophe. 

The  procedure  of  the  War  Trade  Board  in  thisr  as  in  all  other  regulations 
instituted  by  it,  necessarily  is  designed  to  attain  greater  national  efficiency 
through  the  distribution  of  imported  commodities,  but  the  board  is  likewise 
desirous  of  accomplishing  this  result  with  the  least  disturbance  to  the  legitimate 
course  of  industry,  understanding  that  the  harmonious  coordination  of  all 
the  energies  of  the  Nation  is  the  best  guaranty  for  the  successful  termination 
of  the  wap. 

More  rigid  regulations  became  effective  January  14,  1918: 

The  War  Trade  Board,  after  due  consideration,  has  decided  to  supersede  its 
regulations  of  December  15,  1917,  affecting  the  importation  of  wool  and  deal- 
ings in  foreign  and  domestic  wool  and  to  promulgate  in  their  place  and  stead 
certain  other  regulations  effective  as  of  January  14,  1918.  Pursuant  to  such 
decision,  the  War  Trade  Board  hereby  withdraws  the  said  regulations  of 
December  15,  1917,  and  in  their  place  and  stead  promulgates  the  following 
regulations,  effective  on  and  after  January  14,  1918 : 

First.  All  importers  of  wool  will  sign,  before  the  delivery  or  release  of  any 
imported  wool  to  them,  an  agreement  or  guaranty  containing  among  other 
things  provisions  in  substantially  the  following  form : 

That  the  United  States  Government  shall  have,  and  is  hereby  granted,  an 
option  to  purchase  at  the  price  and  on  the  terms  hereinafter  set  forth  all  or 
any  part  of  the  wool  covered  by  this  guaranty  for  ten  (10)  days  after  custom- 
house entry  thereof;  and  thereafter  to  purchase  such  portion  thereof  as  shall 
be  at  any  time  unsold  by  the  importer  until  the  whole  amount  thereof  has 
been  sold.  In  the  event  of  the  exercise  of  such  option  the  basis  price  to  be 
paid  for  the  wool  shall  be  equivalent  to  five  (5)  per  cent  less  than  the  basis  of 
price  of  July  30,  1917,  for  similar  wool,  as  established  by  the  valuation  com- 
mittee of  the  Boston  Wool  Trade  Association,  the  actual  price  of  each  lot  to 
be  determined  by  a  committee  appointed  jointly  by  the  wool  trade  and  the 
United  States  Government.  This  option  shall  not  apply  to  any  wool  purchased 
abroad  before  December  15,  1917. 


712  HISTORY   OF  PEICES   DURING  THE   WAR. 

That  the  importer  will  neither  export  any  merchandise  in  class  A  or  class  B 
of  domestic  or  foreign  origin,  as  hereinafter  described,  nor  transfer  ownership 
or  control  thereof  to  or  for  the  benefit  of  any  person  or  persons  outside  the 
United  States  without  first  obtaining  an  export  license  from  or -the  consent  of 
the  War  Trade  Board. 

That  the  importer  will  not  sell  to  any  person  or  persons  in  the  United  States 
any  merchandise  in  class  A  of  domestic  or  foreign  origin,  as  hereinafter  de- 
scribed, without  first  obtaining  the  purchaser's  agreement,  in  form  satisfactory 
to  the  War  Trade  Board,  and  the  consent  thereon  of  the  War  Trade  Board, 
which  consent  is  to  be  applied  for  through  the  Textile  Alliance  (Inc.). 

That  the  importer  will  not  sell  or  deliver  to  any  person  or  persons  in  the 
United  States  any  merchandise  in  class  B  of  domestic  or  foreign  origin,  as 
hereinafter  described,  without  rendering  to  the  purchaser  at  or  prior  to  the 
time  the  merchandise  is  shipped  or  delivered  a  written  invoice  thereof  con- 
taining the  following  conditions  to  be  fulfilled  by  such  purchaser: 

That  the  purchaser  will  neither  export  such  merchandise  nor  transfer  own- 
ership or  control  thereof  to  or  for  the  benefit  of  any  person  or  persons  outside 
the  United  States  without  first  obtaining  an  export  license  from  or  the  consent 
of  the  War  Trade  Board. 

That  the  purchaser  will  report  through  the  Textile  Alliance  (Inc.)  to  the 
War  Trade  Board  at  the  end  of  each  month  all  sales  of  such  merchandise. 

That  the  purchaser  will  not  resell  such  merchandise  to  purchasers  in  the 
United  States  excepting  under  the  same  conditions. 

Description  of  class  A  and  class  B  merchandise: 

Class  A :  Wool ;  animal  hair  suitable  for  spinning  or  weaving ;  tops  of  wool 
or  of  animal  hair ;  wooled  skins ;  skins  of  sheep  or  of  goats  or  of  lambs  or  of 
kids  bearing  hair  suitable  for  spinning  or  weaving. 

Class  B:  Noils  of  wool  or  of  animal  hair;  yarn  of  wool  or  of  animal  hair; 
waste  of  wool  or  of  animal  hair;  animal  hair  unsuitable  for  spinning  or  weav- 
ing; woolen  rags;  jute  wrappings  or  coverings  when  received  as  wrappings  or 
coverings  of  merchandise  listed  in  class  A  or  class  B  above. 

Second.  Purchasers  of  class  A  merchandise  from  importers  will  sign  .an 
agreement  or  guaranty  containing,  among  othe~  things,  all  of  the  provisions 
above  set  forth,  with  the  exception  of  the  provision  giving  an  option  of  pur- 
chase to  the  United  States  Government. 

New  rulings  were  announced  in  the  War  Trade  Board  Journal  for  August, 
1918: 

The  supply  of  wool  in  the  United  States  has  been  gradually  decreasing  owing 
to  the  enormous  demands  for  military  requirements  and  because  of  the  short- 
age in  ocean  tonnage  for  transporting  wool  to  this  country,  and  it  is  evident 
there  will  not  be  sufficient  wool  to  take  care  of  both  civilian  and  military 
needs  unless  some  comprehensive  plan  is  adopted  for  purchasing  and  importing 
the  necessary  supply. 

It  is  apparent  that  under  the  present  system  of  private  transactions  in  wool 
it  is  difficult  to  insure  the  utilization  thereof  in  the  best  interests  of  the  coun- 
try, and  likewise  difficult  for  individuals  to  secure  the  necessary  tonnage  be- 
cause of  lack  of  assurance  to  the  Shpping  Board  that  the  wools  imported  will 
be  used  for  the  national  interests. 

The  War  Trade  Board  on  July  12,  1918,  after  consulation  with  the  War  In- 
dustries Board  and  the  War  Department,  therefore  adopted  the  following 
ruling : 

1.  All  outstanding  licenses  for  the  importation  of  wool  from  Uruguay,  Argen- 
tina, and  South  Africa  are  revoked  as  to  ocean  shipments  made  from  abroad 
after  July  28,  1918. 

2.  Hereafter   no   licenses  for   the  importation   of   wool   from   the   countries 
above  referred  to  for  shipment  from  abroad  after  July  28,  1918,  will  be  issued 
for  the  remainder  of  the  present  calendar  year,  except  to  the  Quartermaster 
General  of  the  United  States  Army.     (W.  T.  B.  R.  166.) 

GOVERNMENT  REGULATIONS  FOR  HANDLING  WOOL  CLIP  OF  1918. 

The  War  Industries  Board  has  fixed  the  prices  of  the  1918  clip  of  wool,  as 
established  by  valuation  committees  and  approved  by  the  Government,  as  those 
established  on  July  30,  1917,  at  Atlantic  seaboard  markets.  These  values  are 
figured  on  scoured  basis. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  713 

RIGHTS   OF   THE  GOVERNMENT. 

The  Government  shall  have  a  prior  right  to  acquire  all  of  the  1918  wool 
clip,  or  any  portion  thereof  which  it  may  require,  at  the  prices  fixed  by  the 
War  Industries  Board.  The  remainder  will  be  subject  to  allocation  for  civilian 
purposes  under  the  direction  of  the  War  Industries  Board. 

A  very  large  portion  of  the  wool-manufacturing  machinery  working  on  Gov- 
ernment contracts  is  located  close  to  the  Atlantic  seaboard,  and  in  order  to 
avoid  the  possibility  of  railroad  delay  and  congestion  late  in  the  season,  when 
the  crops  are  moving,  it  is  desirable  and  necessary  that  the  wool  clip  shall  be 
collected  as  soon  as  possible  at  points  near  to  the  manufacturing  centers.  For 
these  reasons  it  has  been  considered  advisable  to  designate  as  distributing 
centers  those  centers  which  are  close  to  points  of  consumption  and  which  have 
the  necessary  facilities  for  handling  wool. 

NECESSITY  FOR  CONCENTRATION. 

The  necessities  of  the  Government  at  this  time  are  such  as  to  require  the 
use  of  all  existing  agencies  for  concentrating  the  wool  near  the  centers  of  con- 
sumption. Therefore  all  the  wool  of  the  1918  clip  must  be  distributed  through 
approved  dealers  in  approved  centers  of  distribution. 

-  APPROVED  DEALERS   DEFINED. 

Approved  dealers  shall  be  those  dealers  authorized  by  the  War  Industries 
Board  to  handle  wool  who  are  located  in  the  distributing  centers  and  who  buy 
from  growers  direct,  through  agents,  or  from  country  merchants ;  and  also, 
those  dealers  authorized  by  the  War  Industries  Board  who  are  located  in  wool- 
growing  districts,  and  who  buy  direct  from  growers  and  resell,  or  consign  to 
the  dealers  in  distributing  centers. 

Approved  distributing  centers  are  the  usual  well-recognized  points  of  dis- 
tribution. 

CLASSES   OF    WOOL. 

In  a  general  way,  the  clip  may  be  divided  into  fleece  wool  and  territory  wool. 

Fleece  wool  shall  be  considered  as  that  which  is  grown  in  the  States  east 
of  the  Mississippi  River,  and  also  the  States  of  Minnesota,  Iowa.  Missouri, 
Arkansas,  and  Louisiana,  and  also  those  parts  of  Kansas,  Nebraska,  North 
Dakota,  and  South  Dakota,  and  other  localities  where  the  same  general  con- 
ditions prevail.  All  wool  not  listed  as  fleece  wool  shall  be  considered  terri- 
tory wool. 

In  order  that  the  collection  of  the  clip  may  proceed  in  a  rapid  and  orderly 
manner,  the  following  regulations  are  promulgated  by  the  Wool  Division  of 
the  War  Industries  Board : 

FLEECE  WOOL  REGULATIONS. 
COMPENSATION  OF  GROWER  AND  DEALER. 

Approved  dealers  shall  be  entitled  to  a  gross  profit  in  no  case  to  exceed  1£ 
cents  per  pound  on  the  total  season's  business,  this  profit  to  cover  all  expenses 
from  grower  to  loading  wool  on  board  cars. 

The  grower  shall  receive  fair  prices  for  his  wool  based  on  the  Atlantic  sea- 
board price  as  established  on  July  30,  1917,  less  the  profit  to  the  dealer,  as 
stated  above,  and  less  freight  to  seaboard,  moisture  shrinkage,  and  interest. 

In  no  case  shall  this  be  construed^to  mean  that  there  shall  be  more  than  1£ 
cents  gross  profits  made  from  time  wool  leaves  growers'  hands  until  it  arrives 
at  the  distributing  center. 

On  consignments  forwarded  to  distributing  centers  the  prices  to  be  paid  for 
the  wool  to  the  approved  dealers  therein  shall  be  those  established  by  the 
valuation  committee  on  Atlantic  seaboard  values  of  July  30,  1917,  to  which 
shall  be  added  a  commission  of  4  per  cent  to  be  paid  by  the  Government,  if 
bought  by  the  Government,  or  by  the  manufacturer  to  wThom  the  wool  is  allotted 
for  other  than  Government  purposes.  This  commission  is  to  include  grading 
and  other  expenses  of  handling.  The  consignor  shall  be  charged  with  the 
freight  on  his  shipment  and  interest  on  all  advances  made  for  his  account  to 
the  date  of  the  arrival  of  his  wool  at  a  distributing  center,  as  shown  by  the 
railroad  receipt. 


714  HISTORY   OF   PRICES   DURING   THE    WAR. 

On  any  lot  remaining  unsold  in  his  possession  for  a  longer  period  than  six 
months  the  dealer  shall  be  entitled  to  charge  storage  and  insurance  at  the 
market  rate,  and  this  additional  charge  shall  be  added  to  the  price  of  the  wool. 

POOLING  BY   GROWERS   IS   ADVISED. 

Growers-  who  desire  to  do  so  will  be  allowed  to  pool  their  clips  in  quantities 
of  not  less  than  minimum  carloads  of  16,000  pounds  and  consign  the  wools  so 
pooled  as  one  account  to  any  approved  dealer  in  any  approved  distributing 
center.  Growers  are  urged  to  adopt  this  latter  course  through  county  agents 
or  others,  thus  eliminating  the  profits  of  one  middle  man. 

GOVERNMENT  PRICE. 

Approved  dealers  in  approved  distributing  centers  will  be  required  to  open 
and  grade  all  their  purchases  or  consignments  as  rapidly  as  possible  after 
the  arrival  of  wool  at  point  of  distribution.  Prices  on  all  wools,  as  soon  as 
graded,  will  be  fixed  by  a  Government  valuation  committee  appointed  for  that 
purpose  in  the  different  distributing  centers.  Prices  to  be  paid  by  the  Gov- 
ernment at  distributing  centers  for  such  wool  as  it  may  require  are  to  be 
those  established  as  of  July  30,  1917,  at  the  Atlantic  seaboard  markets.  In 
addition  to  said  prices  the  Government  is  to  pay  a  further  sum  equal  to  4  pel- 
cent  of  the  selling  prices  to  cover  compensation  or  commission  to  approved 
dealers  for  their  services  in  collecting  and  distributing  wool.  On  wool  not 
taken  by  the  Government  for  its  own  use  and  which  may  be  allocated  for  other 
uses,  prices  will  also  be  fixed  in  accordance  with  July  30,  1917,  values  at 
Atlantic  seaboard  markets,  and  on  such  wool  approved  dealers  shall  be  entitled 
to  a  commission  or  compensation  of  a  sum  equal  to  4  per  cent  of  the  selling 
price,  and  this  commission  or  compensation  shall  be  a  charge  against  said  wool 
and  shall  be  collected  from  the  manufacturer  to  whom  said  wool  is  allocated. 

PROFITEERING  PROHIBITED. 

As  a  guard  against  profiteering,  the  books  of  all  approved  dealers  in  dis- 
tributing centers  shall  be  at  all  times  open  to  Government  inspection,  *nd  if 
it  be  found  that  their  gross  profits,  including  the  aforesaid  commission  of  4 
per  cent,  are  in  excess  of  5  per  cent  on  the  season's  business,  then  such  profits 
Shall  be  disposed  of  as  the  Government  decides. 

The  books  of  the  country  dealers  shall  likewise  be  open  to  Government  inspec- 
tion. If  it  be  found  that  their  gross  profit  for  the  season's  business  is  In 
excess  of  1$  cents  per  pound,  then  such  excess  profits  shall  be  disposed  of  as 
the  Government  may  decide. 

DISTRIBUTING   CENTERS. 

The  approved  distributing  centers  for  fleece  wools  are: 

Boston,  Mass.  Chicago,  111.  Louisville,  Ky. 

New  York,  N.  Y.  St.  Louis,  Mo.  Baltimore,  Md. 

Philadelphia,  Pa.  Detroit,  Mich.  Wheeling,  W.  Va. 

TERRITORY  WOOL  REGULATIONS. 
EXCEPTIONS. 

In  the  Willamette  Valley,  Oreg.,  and  the  Puget  Sound  district  of  the  State  of 
Washington,  the  regulations  in  regard  to  fleece  wools  shall  apply. 

DISTRIBUTING    CENTERS. 

For  the  reasons  before  stated,  in  order  that  the  1918  wool  clip  may  be 
promptly  concentrated  near  the  manufacturing  centers  and  to  make  use  of 
every  available  agency  for  storing  and  grading,  all  Territory  Wools  must  be 
consigned  to  one  of  the  designated  distributing  centers  which  are  as  follows : 

Portland,  Oreg.  New  York,  N.  Y.  Boston,  Mass. 

Chicago,  111.  St.  Louis,  Mo.  Philadelphia,  Pa. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  715 

The  only  exception  is  that  clips  of  under  1,000  pounds  may  be  sold  by  the 
owner.  In  buying  these  small  clips,  the  buyer  must  recognize  that  he  is  en- 
titled to  only  a  small  profit,  which  must  not  exceed  2  cents  per  pound.  Growers, 
if  they  desire  for  any  reason  to  consign  their  wool  through  their  banker,  coun- 
try merchants,  or  others,  may  do  so  and  said  bank,  country  merchant,  or 
others,  may  receive  a  commission  or  compensation  for  handling  said  growers' 
wool  (in  no  case  to  exceed  one-half  cent  per  pound)  ;  such  commission  or  com- 
pensation to  be  paid  by  grower.  Growers  are,  however,  urged  to  consign  their 
own  wool  and  get  the  full  price. 

SHIPPING. 

As  soon  as  possible  after  wool  reaches  the  railroad  the  owner  should  load 
It  and  consign  it  to  any  approved  dealer  he  may  select  in  one  of  the  designated 
distributing  centers,  who  will  there  deliever  the  wool  to  the  Government  or  to 
some  manufacturer  to  whom  the  Government  may  allot  the  wool.  These  ap- 
proved dealers  will  store,  insure,  handle,  and  deliver  the  wool  under  Govern- 
ment regulation.  The  grower  should  procure  two  copies  of  the  shipping  invoice 
and  of  the  railroad  bill  of  lading,  and  forward  the  original  invoice  and  bill 
of  lading  to  the  dealer  whom  he  has  selected  to  handle  his  wool,  retaining  the 
duplicate  in  his  own  possession. 

ADVANCES,   INTEREST,    AND   FREIGHT.  * 

The  grower  shall  be  entitled  to  receive  an  advance  up  to  but  not  exceeding 
75  per  cent  of  the  fair  estimated  market  value  of  his  wool.  He  shall  pay  in- 
terest on  this  advance  at  the  rate  of  6  per  cent  per  annum  from  the  date  he 
receives  such  advance  until  his  wool  arrives  at  the  distributing  center,  as 
shown  by  the  railroad  receipt.  It  is  not  intended  that  the  grower  shall  pay 
interest  on  advances  after  the  date  of  arrival,  as  shown  by  the  railroad  receipt, 
and  he  shall  be  entitled  to  receive  interest  on  the  selling  value  of  his  wool  after 
freight  has  been  deducted  from  date  of  arrival.  The  Government  is  fixing  the 
price  of  the  1918  clip  on  a  basis  delivered  at  Atlantic  seaboard  points.  It  is 
therefore  incumbent  on  the  grower  to  deliver  his  wool  at  the  designated  dis- 
tributing centers,  and  the  expense  of  delivering  the  wool  at  such  centers  will 
be  charged  against  the  wool  on-  a  basis  of  the  freight  rate  from  point  of  origin 
to  the  Atlantic  seaboard. 

VALUING    AND    GRADING. 

As  soon  as  possible  after  the  arrival  of  the  wool  at  a  distributing  center, 
if  the  wool  is  to  be  taken  in  the  original  bags,  it  shall  be  valued  by  the 
Government  Valuation  Committee.  If  the  wool  is  to  be  graded,  it  shall  be 
valued  in  the  piles  by  the  Government  Valuation  Committee  as  soon  as  the 
piles  are  graded  and  ready  for  delivery.  All  grading  will  be  conducted  under 
Government  supervision.  The  grades  out  of  each  clip  will  be  weighed  sepa- 
rately and  the  books  of  the  dealer,  as  far  as  they  pertain  to  any  grower's 
wool,  shall  be  open  to  him.  Tags,  bucks,  black,  and  other  recognized  discount 
fleeces  win  be  paid  for  at  prices  fixed  by  the  Government.  Bags  will  be 
paid  for  in  the  same  manner. 

PAYMENTS    TO    GROWERS. 

Growers  shall  be  entitled  to  payment  on  a  basis  of  the  date  of  the  arrival 
of  the  wool  as  shown  by  the  railroad  receipt.  However,  as  it  would  be  im- 
possible for  obvious  reasons  to  make  settlement  on  each  clip  on  the  date  of 
its  arrival,  in  order  that  the  grower  may  lose  nothing  by  any  delay  in  settle- 
ment, he  shall  be  entitled  to  draw  interest  on  the  selling  price  of  his  wool  less 
freight  from  the  date  of  the  wool's  arrival  until  the  date  of  final  settlement 

Final  returns  will  be  made  as  promptly  as  possible  in  all  cases. 

COMMISSIONS. 

The  grower  does  not  pay  the  commission  or  compensation  for  handling  wools 
in  the  designated  distributing  centers.  This  commission  or  compensation  for 
handling  will  be  added  to  selling  price  of  the  wool  and  paid  by  the  buyer. 

If  sold  in  the  original  bags,  the  commission  or  compensation  shall  be  3  per 
cent  of  the  selling  price.  If  the  wool  is  graded,  the  commission  or  compensation 
shall  be  3£  per  cent  of  the  selling  price.  This  commission  or  compensation 
includes  drayage,  storage,  and  insurance  for  a  period  not  exceeding  on  any  lot 
six  months  after  arrival.  On  any  lot  remaining  unsold  in  his  possession  Jor  a 


716 


HISTORY   OF  PRICES   DURING   THE   WAR. 


longer  period  than  six  months  the  dealer  shall  be  entitled  to  charge  storage 
and  insurance  at  the  market  rate,  and  this  additional  charge  shall  be  added 
to  the  price  of  the  wool. 

MILLS  LOCATED  IN    WOOL-GROWING  DISTRICTS. 

In  order  that  the  Government  may  have  full  control  of  the  wool  situation, 
with  a  view  to  conserving  as  far  as  may  be  necessary  the  wool  supply  for 
military  purposes,  it  is  considered  necessary  to  prohibit  manufacturers  from 
buying  wool,  except  in  the  designated  distributing  centers,  and  then  only  with 
the  permission  and  consent  of  the  Government  under  such  regulations  as  the 
Government  may  hereafter  make. 

However,  mills  located  in  wool-growing  districts  not  near  to  the  designated 
centers  of  distribution,  and  which  are  working  on  Government  orders,  will  be 
given  permits  through  the  wool  division  of  the  War  Industries  Board  to  buy 
certain  amounts  of  wool  in  their  immediate  neighborhood.  In  making  appli- 
cations for  such  permits,  the  manufacturer  applying  should  state  the  number 
of  his  Government  order,  the  amount  of  goods  yet  to  be  delivered  against  such 
order,  the  amount  of  his  wool  stock  on  hand,  and  the  amount  and  class  of  wool 
required  to  complete  said  order.  The  manufacturer  receiving  such  a  permit 
will  be  required  to  report  to  the  wool  division  of  the  War  Industries  Board  all 
purchases  made  against  permit  issued  to  him. 

PERMITS   TO  DEALERS. 

All  dealers  in  approved  centers  desiring  a  permit  to  operate  should  apply  to 
the  wool  division  of  the  War  Industries  Board  stating  their  capacity  for  storing 
and  grading. 

All  country  dealers  should  apply  for  a  permit  to  operate  by  writing  to  the 
wool  division  of  the  War  Industries  Board  giving  name  and  address. 

In  order  to  expedite  movement  of  wool,  dealers  in  country  districts  and  dis- 
tributing centers  may  operate  immediately  in  accordance  with  the  above  regula- 
tions, pending  application  for  and  granting  of  permit. 

LEWIS  PENWELL, 
Chief  of  Wool  Division,  War  Industries  Board. 

GOVERNMENT  WOOL  PRICES,  EFFECTIVE  MAY  1,  1918. 
DOMESTIC  WOOL   IN  THE   GREASE. 

BOSTON     VALUATIONS SCOURED    BASIS AS    OF    JULY     30,     1917 GREASY    FLEECE     WOOLS. 

OHIO  AND  SIMILAR,  INCLUDING  NEW  ENGLAND  STATES,  NEW  YORK,  PENNSYL- 
VANIA, WEST  VIRGINIA,  KENTUCKY,  VIRGINIA,  MICHIGAN,  NEW  JERSEY 
DELAWARE  AND  MARYLAND. 


Choice. 

Average. 

Fine  delaine  ".      .             

$1  85 

Fine  clothing       

$1  75 

1  70 

i^  Bid  staple 

1  68 

%  Bid.  clothing  

1  60-62 

3-8  staple 

1  45 

3-8  clothing  

1  42 

1-4  Bid.  staple  

1  32 

1  4  Bid  clothing 

1  30 

Low  1-4      ... 

1  17 

Common  and  braid.  .  . 

1.07 

MISSOURI,    INDIANA,    ILLINOIS,    AND    SIMILAR,    INCLUDING    IOWA,    WISCONSIN, 
MINNESOTA,  KANSAS,  NEBRASKA,  AND  ARKANSAS. 


_ 

Choice. 

Average. 

Fine  delaine 

$1  80 

Fine  clothing  

$1.70 

.65 

^  Bid.  staple  .... 

1.63 

60 

Yi  Bid  .  clothing  

1.60 

.57 

3-8  staple  .          

1.40 

.37 

3-8  clothing  .  . 

1  37 

34 

1-4  Bid  staple 

1  28 

26 

Bid.  clothing    . 

1  26 

.24 

Low  1-4 

1  17 

15 

Common  and  braid  .  .  . 

1.07 

GOVERNMENT  REGULATIONS   RELATING   TO   PRICES. 


717 


GOVERNMENT  WOOL  PRICES,  EFFECTIVE  MAY  1,  1918— Continued. 
GEORGIA  AND  LAKE  WOOLS  AND  OTHER   SOUTHERN  WOOLS. 


Average. 


Average  lots,  largely  3-8s  . 
Average  lots,  largely  l-4s  . 


$1.25 
1.20 


Semibrights   are  to  be   classified 
the  lot. 


Semibright. 

5   territory   or  fleece,   according  to   the  ^character   of 
TERRITORY. 


Choice. 

Average. 

Inferior. 

Fine  and  fine  medium  staple                                                    

$1.80 

$1.75 

$1.70 

Fine  and  fine  medium  clothing                                   •                        ... 

1.70 

1.65 

1.62 

J  B  Id  staple                                                                 

1.68 

1.63 

1.60 

J  Bid  clothing                                                                       '             .... 

.60-62 

1.58 

1.53 

High  3  8s  staple  56-58s 

.45 

1.42 

1.40 

High  3  8s  clothing  56-58s                                                    

.42 

1.39 

1.37 

.40 

1.37 

1.35 

3—  8s  clothing  56s                                             .          

.37 

1.34 

1.32 

Low  3  8s  staple  50-56S 

.35 

1.32 

1.30 

Low  3  8s  clothing  50-56s 

1  32 

1.29 

1.27 

High  1  4  blood  staple  48-50s                                        

1.32 

1.29 

1.27 

High  1-4  clothing  48-50s 

1.30 

1.27 

1.25 

1_4  staple  46-48s                .                              

1.28 

1.26 

1.24 

1-4  clothing  46-48s 

1.26 

1.24 

1.22 

Low  1-4  staple  44s                         

1.17 

1.15 

1.13 

1.07 

1.05 

1.03 

TEXAS. 


$1.75 

$1.70 

$1.65 

Eight  months                        

1.55 

1.50 

1.45 

1.50 

1.45 

1.40 

CALIFORNIA. 


$1.70 

$1.65 

$1.60 

1.50 

1.45 

1.40 

fall                                    

1.40 

1.15 

SOUTH  AMERICAN  WOOLS. 

[Valuation   of   South   American   wools   in   the  grease   on   a   clean   scoured   basis. — Values 
.  as  of  July  30,  1917.] 

ARGENTINE,    MONTEVIDEO,    AND    CONCORDIA    FLEECE   WOOLS,    BASIS    UNITED 
STATES    OF    AMERICA    STANDARD    TYPES. 


Argentine. 

Montevideo 
and 
Concordia. 

Good  6s  or  32  36s  combing  fleece                                            

$0.85 

$0.85 

.90 

.90 

1.05 

1.05 

1.20 

1.20 

1.25 

1.30 

1.35 

1.40 

Good  1  2  Bid  or  58-50  combing  fleece                         

1.45 

1.55 

Good  60-64s  combing  fleece                        -  

1.55 

1.60 

1.60 

1.65 

1.50 

1.50 

718 


HISTORY   OF  PRICES   DURING   THE   WAR. 


SOUTH  AMERICAN  WOOLS— Continued. 
ARGENTINE,   MONTEVIDEO,   AND    CONCORDIA   BURRY    COMBING   FLEECE. 


Argentine. 


Montevideo 

and 
Concordia. 


Burry  6s  or  32-36s  combing  fleece 

Burry  5s  or  36-40s  combing  fleece 

Burry  4s  or  44-40s  combing  fleece 

Burry  3s  or  46s  combing  fleece 

Burry  50s  combing  fleece 

Burry  56s  combing  fleece 

Burry  |-bld.  or  58-60s  combing  fleece . 

Burry  60-64s  combing  fleece 

Burry  64s  combing  fleece 

Burry  64s  clothing  combing  fleece 


$0.75 

.80 

.95 

1.10 

1.15 

1.20 

1.30 

1.40 

1.45 

1.35 


SO.  75 

.80 

.95 

1.10 

1.15 

1.25 

1.40 

1.45 

1.50 

1.35 


In  all  the  above  burrs  are  considered  in  the  shrinkage. 

Argentine,    Montevideo,    and    Corcordia,    good    skirting,    free    from    bellies,    same    basis 
as  Burry  combing  fleece. 

LAMBS. 

BUENOS      AIRES,      MONTEVIDEO,      CONCORDIA,      PATAGONIA,      AND      SIMILAR 
LAMBS— PRACTICALLY  FREE. 


Buenos 
Aires. 


Montevideo, 

Concordia, 

Patagonia, 

and  similar.- 


Good36-40s 

Good44-40s 

Good  46s 

Good  50s 

Good  56s 

Good  %  blood  of  58-60s.. 
Good  64s 


$0.80 
.95 
1.00 
1.05 
1.15 
1.25 
1.25 


$0.80 
.95 
1.05 
1.16 
1.25 
1.30 
1.30 


BUENOS  AIRES,  MONTEVIDEO,  CONCORDIA,  PATAGONIA,  AND  SIMILAR  SECOND 
CLIP  WOOLS — PRACTICALLY  FREE. 


Good  5s  or  36-40s $0. 85  $0. 85 

Good  4s  or  14-40S 1. 00  1. 00 

Good  3s  or  46s 1. 05  1. 10 

Good  60s 1.15  1.20 

Good  56s 1.25  1.30 

BELLIES. 

BUENOS    AIRES,    MONTEVIDEO,    CONCORDIA,    AND    SIMILAR    BELLIES. 

5s   or   25-40s $0.  75 

4s   or   44-40s .90 

3s   or   46s - .95 

50s 1.  05 

56s   1.  15 

58-60s    1.  25 

64s   1.  25 

Burrs  included  in  shrinkage. 

PUNTA  ARENA  FLEECE. 
[Skirted,  U.  S.  A.  style.] 

36-40s'good  combing  fleece $0.90 

44-40s  good  combing  fleece 1.  OC 

46s  good  combing  fleece 1.  20 

50s  good  combing  fleece 1.  30 

56s  good  combing  fleece 1.  4C 

58-60s  good  combing  fleece 1.  5c 

64s  good  combing  fleece 1.  60 

•      PUNTA   ARENAS,    BELLIES    AND   PIECES. 

36-40s  clothing $0.80 

44_40S   clothing .90 

46s  clothing 1.  1C 

50s  clothing 1.20 

56s  clothing 1.30 

58-60s  clothing 1-45 

64s  clothing 1.50 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES. 


719 


BELLIES— Continued. 

PERUVIAN  WASHED. 

White  supermerino   $1.  50 

White   average   merino 1.  30 

White   choice   No.    1 1.27 

White   average   No.   1 1.  20 

White  average   No.   2 1.  10 

Gray  merino 1.  25 

Gray  average  No.   1 1.  08 

White  pieces  and  locks ' 1.  00 

Stained    1.  15 

ICELAND  WASHED. 

Choice  washed $0.  90 

Average   *. .  85 

CHILEAN  UNWASHED. 

Merino  spring  56-60s $1. 30 

Merino  Mestiza  Fall  carding 1. 12 

Mestiza  choice  Valdivian  Spring  46-56s  broad 1. 23 

Mestiza  average  spring  56-58s,  some  50s 1.  28 

Doma  average  spring  44-46s 1. 10 

Common  average  spring  40-36s 85 

Cordillira  average  carding,  bulk  50 1.18 

ISA  gray  (carding)  46-56s 1. 15 

PERUVIAN  UNWASHED. 

Choice  50-58s $1. 30 

Average  46-56s  broad 1. 12 

Low  36-40s 85 

Black  44-46s 1. 00 

Gray  40-46s 90 

UNWASHED  ECUADORIAN. 
Ecuadorian  40-36s $0.85 

UNWASHED  BOLIVIAN. 
Bolivian  46-56s $1. 12 

WASHED  BOLIVIAN. 
Bolivian  50-56s $1. 20 

FOREIGN  BLACK  AND  GRAY— COMBING  AND  CLOTHING. 


Combing.         Clothing. 


Blacks. 


44-40s(gray) 

46s  (gray) 

50s  (gray) 

56s  (gray) 

58-60s(gray) 

60-64s  and  fine  (gray). 

Iceland  (gray) 

China  (gray) 

Peruvian  (gray) 

Bolivian  (gray) 

Chili  (gray) 

Ecuador  (gray) 

Spanish  (gray) 

Cape  Coa  and  colored. . 
Greek,  black  and  gray . 


JO.  90 
1.05 
1.15 
1.25 
1.30 
1.50 
.90 

.60-  .70 

21.12 

.80-  .90 


$0.85 
1.00 
1.15 
1.25 
1.30 
1.50 


.70-  .80 
U.25 


.  70-1.  20 
.60-  .85 
.70-  .85 
.40-1.25 
.60-  .75 


1.00-1.30 


$1.00 
1.10 
1.25 
1.35 
1.40 
1.60 


.80-1.00 

1. 25-1. 40 

1.00 


L  1.  30-1. 50 
1.75-1.50 


Fine. 


2  Low. 


»  Pulled  cloth. 


Burry  and  seedy,  cottssame  basis  as  burry  combing. 

SCOURED  WOOLS. 

[Valuation  of  scoured  fleece  wool  on  the  basis  of  values  as  of  July  30,  1917.] 
TERRITORY  AND  FLEECE. 

Scoured  fine  and  fine  medium $1.  62 

Scoured  fine  and  fine  medium  territory  choice 1.  70 

Scoured  fine  medium 1.  60 


Scoured   3-8's   territory 

Scoured  1-4's  territory,  New  Mexican 

Scoured  low  territory,   New   Mexican 

Scoured  fine  California   (baled) 

Scoured   medium   California    (baled) 

Scoured  defective  fine  California  (baled) 

Scoured  slightly  defective  fine  California   (baled). 

Carbonized   fine   California    (baled) 

Carbonized   medium   California    (baled) 

Scoured  fine  short  Texas 

Scoured  domestic  fine  sorts 

Scoured  fine  sorts 

Scoured  domestic  medium  sorts . .. 


45 
23 
.00 
.54 
.40 
.  15 
.38 
.50 
.36 
.60 
.10 
.37 
.05 


720 


HISTORY   OF  PRICES   DURING   THE   WAK. 


SCOURED  WOOLS— Continued. 
SOUTH  AMERICAN  SHO^N  LAMBS. 

Concordia,  Patagonia,  Montevideo,  Pasto  Fuerte,  and  similar  lambs  : 

Scoured    50-56s . _  *i  25 

BUENOS  AIRES  LAMBS. 

Scoured  Buenos  Aires  lambs,  46s _  $1   15 

Scoured  Buenos  Aires  Hoggetts,  46s 

Carbonized   Buenos   Aires   lambs,   46s l'l5 

Carbonized  Buenos  Aires  lambs,  40-44s 1*  10 

SOUTH  AMERICAN  SECOND  CLIP  FLEECE. 

Patagonia,  Pasto  Fuerte,  Concordia,  Montevideo,  and  similar  : 

Scoured   (bulk)  56s _  $1.  35 

Scoured  50-56s 1.  30 

Scoured    50s 1   25 

Scoured    46-50s 1.  20 

Scoured    (bulk)    44s 1.  15 

Carbonized   5fr-56s . 1  35 

Carbonized    46-50s 1   17 

Carbonized  (bulk)   44s 1.  12 

SOUTH  AMERICAN  BALED. 

Scoured  Buenos  Aires  46-50s _  $1.  25 

Scoured  Buenos  Aires    (bulk)    44s 1.  10 

Scoured   Chubut   60-64s 1.65 

SOUTH   AMERICAN   PIECES   AND    BELLIES. 

Scoured   Punta  Arenas,   50s $1.  25 

Scoured  Punta  Arenas,  46s 1.  17 

CHILIAN. 

Scoured  1-2  blood_ $1.25 

Scoured    3-8s 1.  10 

Scoured  gray  and  stained  low  quarter .  80 

Scoured   common .  70 

Merino — 1.  35 

PERUVIAN. 

Scoured  No.  1,  3-8s _• •- $1.  22 

Scoured  No.  2,  quarter 1.  12 

Scoured  gray  low,  3-8s 1.  12 

CAPE. 

Scoured  fine,  fair  staple   (bags) $1.48 

Scoured   fine,   snow-white    (baled),  average 1.  60 

Scoured   fine,   snow-white    (baled),   choice 1.  70 

Scoured   fine    (baled),   inferior 1.  32 

Scoured    fine,    stained    (baled) 1.25 

Scoured  fine,  stained   (baled),  inferior 1.00 

Scoured  grey    (baled),   average _ .  85 

Scoured  grey    (baled),  coarse .  60 

Scoured  fine  choice  long  (bags) 1.70 

Scoured  fine  good  staple    (bags) 1.55 

Carbonized    fine    (bags) 1.62 

Scoured  No.  2   (baled) 1.25 

SCOURED   AUSTRALIAN    FLEECE    WOOL. 


Extra  super,  scoured 

Choice  scoured,  good  length,  sound;  free  or  practically  free. . 

Best  carding,  bulky,  free 

Good  carding,  fairly  free 

Good  average  combing,  scoured  Queensland,  nearly  free 

Average  combing  scoured,  fairly  free .* 

Good  combing  pieces  and  bellies 

Average  length  carbonizing,  bellies,  pieces 

Shivy  fleeces,  thinly  grown 


70'sand 
better. 


$1.80 
1.75 
1.70 
1.60 
1.65 
1.55 
1.50 
1.45 
1.40 


64-70's. 


$1.65 
.70 
.65 
.55 
.60 
.50 
.45 
.40 
1.35 


60-64's. 


$1.65 
1.60 
1.55 
1.45 
1.50 
1.40 
1.35 
1.30 
1.30 


70's. 


64-70's. 


60-64's. 


Super  clothing,  free 

Good  clothing,  free 

Average  clothing,  nearly  free,  carbonizing . 


$1.75 
1.65 
1.55 


$1.70 

1.60 
1.50 


$1.60 
1.55 
1.45 


$1.50 
1.45 
1.35 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  721 

SCOURED  WOOLS— Continued. 
TOPS. 

[Prices  as  of  July  30,  1917.] 
Grade : 

36s $1.00 

40s T  05 

44s 1.  20 

46s  __  1.  35 

50s : ::::::::__::_:  i.  50 

56s 1.  62 

58s 1.  84 

60s -. 1.  95 

64s  -I 2.  05 

66s 2.  12 

32s  and  below  (carpet  tops)  at  corresponding  values. 

PULLED  WOOL. 

[Valuation  on  domestic  and  foreign  pulled  wools  in  the  grease  on  a  clean  basis.     Scouring 
costs  not  included.     All  values  as  of  July  30,  1917.] 

DOMESTIC   COMBINGS. 

AA  combing,  64s $1.80 

A  combing,  60s 1.  70 

B  combing,  56-50s 1.  55 

C  combing,  46-50s 1.  43 

Low  combing,  44-40s 1.25 

Butt  combing,  average  36s . 1.  00 

DOMESTIC  STAPLE. 

AA  staple.  64s $1.78 

A  super  staple,  60s 1.  70 

B  super  staple,  56-50s 1.52 

C  super  staple,  44-50s 1.  42 

DOMESTIC   CLOTHING. 

AAA    clothing,    70s__.                                                                                                                  ,_  $1.  85 

AA  clothing,  64s 1.72 

A  super  clothing,  58-56s = 1.  60 

B  super  clothing,  50s 1.46 

C  super  clothing,  44s 1.  33 

Low  C .  95 

Gray  B  super 1.  28 

Gray  C  super 1.18 

Short  gray •_ .92 

A  shearlings 1.  25 

B  shearlings 1.  15 

C  shearlings .  90 

White  vat .  35 

SPANISH  PULLED. 

Choice  white  fine $1.10 

Average  white .  85 

Choice  black 1.  32 

Average  black  ^ .  82 

Low  black .  65 

Low  medium  white .  75 

Low .65 

MONGOLIAN. 

Choice  No.  1  white $0.68 

Low  white .  55 

Choice  No.  1  gray .  68 

Low  gray .  50 

CHINA. 

Choice  No.  1  white $0.  85 

Average   white -  78 

Average   gray ; •  48 

EAST  INDIA. 

Low   white $0.  55 

Low  medium  yellow •  8fl 

CORDOVA. 

White    combing $0.  65 

Fine   white  clothing .85 

ITALIAN. 

White  skin  wool $0.  45 

ICELAND. 

No.  2  skin  wool $0.80 

No.  1  Iceland •  *><> 

125547°— 20 46 


722 


HISTOBY  OF  PRICES  DURING  THE  WAR. 


PULLED  WOOL— Continued. 

SOUTH   AMERICAN   PULLED. 

Fine   combing $1.  65 

AA  staple  (choice),  60-64s 1.70 

Half  blood  or  58-60s  combing 1.55 

A  combing    (choice),   56-58s *  1.  55 

56s   combing 1.  45 

B  combing    (choice),   50-56s 1.50 

50s   combing 1.  35 

C  combing    (choice),  46-50s 1.35 

46s   combing 1.  25 

Low   combing    (choice),    44s 1.  15 

44_40s   combing 1.  10 

Lincoln  combing   (choice),  36s,  40s 1__  1.00 

Do .  95 

AA  clothing,  60-64s 1.65 

A   clothing,   56s 1.52 

B    clothing,   50s 1.42 

C   clothing,   44-40S 1.12 

Lincoln   clothing,    36s : .  95 

PULLED  CAPE. 

AA  staple.  64s $1.  75 

AA  clothing,   64s 1.  55 

SCOURED  PULLED  WOOLS. 

[Valuation  of  scoured  pulled  wool  on  the  basis  as  of  July  30,  1917.] 
DOMESTIC  PULLED. 

Scoured  domestic,  AA  superpulled  choice $1.  75 

Scoured  domestic.  AA  superpulled  average 1.  65 

Scoured  domestic,  A  superpulled  choice 1.  65 

Scoured  domestic,  low  A  superpulled  choice 1.  53 

Scoured  domestic,  A  superpulled  western 1.  50 

Scoured  domestic,  high  B  choice 1.  50 

Scoured  domestic,  B  superpulled 

Scoured  domestic,  B  superpulled  western 

Scoured  domestic,  C  superpulled  choice 1.  28 

Scoured  domestic,  C  superstained  pulled 1.05 

Scoured  domestic,  C  superlow  stained   pulled 9t 

Scoured  domestic,  gray  B  superpulled l  *» 

SOUTH  AMERICAN  PULLED. 

Scoured   fine 

Scoured    56-58s }•  55 

Scoured  50s ^ *•  *j 

Scoured  46s J   30 

Scoured  40-44s }•  15 

Scoured  Lincoln *•  '"• 

AUSTRALIAN. 

[Valuation  of  Australian  greasy  fleece  combing  on  a  clean  basis  as  of  July  30, 1917.] 


Type. 


Extra  super  spinners,  choicest  style. 
Spinners,  good  length,  free. 


Average  spinners,  bright  and  attractive,  few  burrs 
Super  French  combing,  free 


Shafty  combing,  showy,  bright  but  tender,  free  or  nearly 

Shafty  combing,  sound,  but  more  or  less  burry 

Good  top  makers,  irregular  quality  and  length,  but  fairly  free. . 
Average  top  makers, irregular  quality  and  length,  but  fairly  free. 

Good  French  combing,  fairly  free 

French  combing,  few  burrs 

Average  combing,  more  or  less  burrs . . . 


Average  length  combing,  very  burry  or  suitable  for  carbonizing . . 
French  combing,  very  burry,  or  suitable  for  carbonizing 


70s. 


$1.95 
1.90 
1.85 
1.80 
1.80 
1.78 
1.80 
1.75 
1.75 
1.68 
1.70 
1.60 
1.50 


66-70s. 


$1.93 
1.88 
1.83 
1.78 
1.78 
1.76 
1.78 
1.73 
1.73 
1.66 
1.67 
1.55 
1.45 


64s. 


$1.90 
U.85 
1.80 
1.75 
1.75 
1.75 
1.75 
1.70 
1.70 
1.63 
1.65 
1.50 
1.40 


$1.85 
1.80 
1.75 


CLOTHING. 


Type. 


Extra  super,  regular  length,  absolutely  free. 

Choice  clothing,  absolutely  free 

Average  clothing,  free  or  nearly  free 

Average  clothing,  some  fault 

Faulty,  irregular  64-80s 


80s. 


$1.85 
1.80 
1.70 
1.60 


$1.80 
1.75 
1.65 
1.55 


1.70 
1.68 
1.70 
1.65 
1.65 
1.58 
1.60 
1.45 
1.35 


t-70s. 


i  $1. 65 
1.55 
1.50 
1.40 


Basis  of  prices  as  per  the  committee's  report  on  which  all  valuations  contained  herein  are  based. 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES. 


723 


AUSTRALIAN — Continued. 
BROKEN  NECKS  AND  PIECES— COMBINGS. 


Type. 

64s. 

60-64S 

60s. 

Extra  super  combing,  Geelong  and  N.  E.  types. 

$1  80 

$1  75 

SI  70 

Good  length  combing,  sound  free  or  nearly  free 

i     75 

70 

65 

Average  length,  sound,  free  or  nearly  free."    

.70 

65 

60 

Average  length,  tender,  free  or  nearly  free  .  . 

60 

55 

50 

Good  length  sound  few  burrs  or  seeds 

65 

60 

55 

Average  length,  sound,  few  burrs  or  seeds  

.60 

55 

50 

French  combing,  few  burrs  or  seeds  . 

55 

50 

45 

Good  length  conYbing  very  burry 

60 

55 

50 

Average  length  combing,  very  burry  

.50 

45 

1  40 

French  combing  very  burry  . 

.40 

35 

1  30 

STAINED  PIECES  AND  CARBONIZING  PIECES. 


Type. 

64s  and 
better. 

60-«4s. 

Good  length  carbonizing  bellies  .... 

$1.25 
1.15 
.00 
.50 
.45 
.35 
.25 
.10 
.00 
.80 

11.15 
1.05 
.90 
1.40 
1.35 
1.25 
1.15 
1.00 
.90 
.70 

Average  length  carbonizing  bellies.. 

Short  length  carbonizing  bellies  

Good  length  combing  stained  pieces,  free  or  nearly  free  

Average  length  combing,  free  or  nearly  free  stained  pieces  
Good  length  combing  stained  pieces,  burry 

Average  length  combing  stained  pieces  burry 

Bulky  carbonizing  stained  pieces. 

Average  carbonizing  stained  pieces  ,  

Inferior  carbonizing  stained  pieces  

Carbonizing  charges  not  included. 


COMBING  BELLIES. 


Type. 

64-70S. 

60-64S. 

60s. 

Super  combing  bellies,  sound,  free  . 

$1.70 

$1.60 

$1  50 

Good  length  combing  bellies,  sound,  free  or  nearlv  free 

1  1.65 

1  55 

50 

Average  length  combing  bellies,  free  or  nearly  free,  sound  
French  combing  bellies,  fairly  free 

1.55 
1.45 

1.45 
1  35 

.40 
30 

Good  length  combing  bellies,  more  or  less  burry  and  seedy  or  tender  
Average  length  combing  bellies,  more  or  less  burry  and  seedy  or  tender  
French  combing  bellies,  more  or  less  burry  or  seedy.  .  . 

1.45 
1.35 
1  30 

1.35 
1.25 
1  20 

.30 
.15 
1  15 

Combing  bellies,  verv  burry  

1.25 

1.15 

1.10 

1  Basis  of  prices  as  per  the  committee's  report  on  which  all  valuations  contained  herein  are  based. 

MERINO  LAMBS. 

Extra  super  geelong  lambs  free 

Super,  practically  free 

Average  length  second  super,  practically  free 

Short  free  lambs 

Good  length,  more  or  less  burrs } 

Medium  length,  more  or  less  burrs. . 

Irregular  length,  more  or  less  burrs. .  >carbonizing 

Short  length,  more  or  less  burrs 

Inferior  Kempy ,  carbonizing J 

MERINO  LOCKS. 

Good  length  locks  free .' 

Average  length  locks  free : 

Short  length  locks  free 

Bulky  locks,  carbonizing. 

Average  length  locks,  carbonizing 

Short  length  locks,  carbonizing 

Carbonizing  charges  not  included. 

WEANERS. 


$1.70 
1.60 
1.56 
1.40 

11.40 
1.35 
1.20 
1.10 


$1.20 

1.10 

1.00 

1.00 

.90 

.89 


70s. 

64s. 

60s. 

First  rombing  wpanpr<? 

$1.60 

$1.55 

$1.50 

Second  combing  weaners                                     

1.30 

1.25 

1.20 

1  This  price  taken  as  basis;  10  cents  carbonizing  charges  added  to  same  is  equivalent  to  the  committee's 
basis  of  $1.40. 


724 


HISTORY   OF   PRICES   DURING  THE   WAR. 


GREASY  AUSTRALIAN  AND  NEW  ZEALAND  FLEECES— GOOD. 
[Scoured  basis  as  of  July  30, 1917.] 


36s $0.95 

40s 1.00 

44s 1.15 

46s , 1.30 

46-SOs...  ..   1.35 


50s.... 
50-56S. 
56s.... 

58s.... 


$1.45 
1.50 
1.55 
1.70 


CARPET. 


Per 
cent. 

July  30,  1917. 

Grease 
price. 

Basis 
scoured. 

Scoured. 

Handshaken  fleece  No  1  white  sining 

40 
35 
42 
42 
46 
35 
48 

$0.43 
.38 
.39 
.39 
.36 
.37 
.38 

$0.72 
.59 
.67 
.67 
.67 
.57 
.73 

$0.80 
.65 
.76 
.73 
.72 
.62 
.85 
.75 
.SO 
.62 
.68 
1.10 
.95 
.59 
.90 
.,56 
.85 
.82 
.80 
.61 
.80 
.75 
.61 
.57 
.52 
.71 
.56 
.54 
.70 
1.40 
1.12 
.95 
1.15 
.85 
.70 
.43 
.55 
.58 
.78 
.61 
.55 
.90 
.75 
.85 
.85 
.75 
.60 
.82 
.51 
.30 
.68 
.62 
.62 

Willowed  No  2  white  sining 

Handshaken  fleece,  black  sining  (super)  

Handshaken  fleece  gray  sining                                              .  . 

Willowed,  No  2  gray 

Handshaken  semi-carbonized  No.  1  white  (good)  

Government  type,  white  Szechuen 

Sundried,  No.  1  white  Szechuen  

35 
48 
39 
9 
25 
33 
25 
35 
42 
-18 
47 
46 
37 
36 
36 
35 
28 
38 
35 
35 
33 
58 
55 
55 
35 
37 
40 
65 
35 
52 
23 
25 
30 
50 
50 
44 
70 
60 
38 
50 
22 
40 
47 
50 
60 

.41 

.28 
.36 
1.00 
.71 
.38 
.65 
.36 
.45 
.36 
.35 
.33 
.43 
.42 
.39 
.37 
.33 
.39 
.36 
.35 
.43 
.56 
.50 
.43 
.71 
.40 
.36 
.15 
.32 
.28 
52 
!46 
.39 
.38 
.37 
.39 
.23 
.26 
.37 
.37 
.40 
.18 
.36 
.31 
.25 

.63 
.54 
.59 
1.10 
.95 
.57 
.87 
.56 
.77 
.70 
.66 
.61 
.68 
.66 
.61 
.57 
.46 
.63 
.56 
.54 
.64 
1.33 
1.10 
.95 
1.10 
.64 
.60 
.43 
.49 
.58 
.68 
.61 
.55 
.76 
.74 
.70 
.77 
.65 
.60 
.74 
.51 
.30 
.68 
.62 
.62 

Sundried,  No.  2  white  Szechuen     .  . 

Sundried  gray  Szechuen 

Washed,  No.  1  white  ball  (super)    .     .           

Government  type,  ball  China* 

Willowed.  No.  2  white  ball.                                     

Willowed,  No.  1  gray  ball 

Willowed,  No.  2  gray  ball                          

Willowed,  open  ball 

Handshaken,  best  unassorted  fleece  (A)      

Handshaken,  medium  unassorted  fleece  (C) 

Handshaken,  low  unassorted  fleece  (D)  .  .    

Willowed,  best  white  filling  (A) 

Willowed,  good  white  filling  (B). 

Willowed,  fair  white  filling  (C) 

Willowed,  low  white  filling  (D)                

Willowed,  short  white  filling  (cuttings) 

Willowed,  best  gray  filling                

Willowed,  fair  gray 

Willowed,  low  filling  

WTllowed,  China  antn^in 

Handshaken,  China  No.  1  fleecy  super  lambs  

Handshaken,  China  No  2  fleecy  lambs  .     .         

Handshaken'  China  No  3  fleecy  lambs 

Wil'nwfidj  China  lamh<? 

Government  type,  China  No.  1  woosie,  spring  

Government  type,  China  No.  1  woosie,  autumn 

Government  type,  China  No.  2  woosie,  autumn  or  spring  
Washed,  China  Shanghai                             .            

Handshaken  China  Honan  unassorted 

Washed  Mongolian,  average  (LTrga  )                        ... 

Washed  Manchurian,  white  (Hailar)  

Washed  Manchurian,  gray                                  

Unwashed  Cordova,  good  carbonized,  white  

Unwashed  Cordova,  good  carbonized,  gray     

Unwashed  Cordova  second  clip  white 

Ecuador                                             .  .         

Caribbean 

Spanish,  coarse  carbonized,  white          

Spanish  good  carbonized  white 

Spanish,  white,  mattress  .         ...                

Spanish  gray,  mattress 

Macedonian,  white,  combing  .           

Macedonian'  black^  combing 

Oporto                                 

GOVERNMENT    ISSUE    PRICES    TO   MANUFACTURERS   HOLDING    GOV- 
ERNMENT  CONTRACTS   MAY   15,   1918. 

The  issue  prices  of  wool  for  Government  contracts  are  based  on  the  valua- 
tion committees'  description  and  estimate  of  shrinkage  of  each  lot.  The  Gov- 
ernment does  not  guarantee  the  estimated  shrinkages  of  the  valuation  com- 
mittees, but  believes  them  to  be  approximately  correct.  Samples  of  each  lot 
will  be  shown  at  the  office  of  the  wool  distributer  and  are  intended  to  fairly 
represent  the  bulk  lot,  but  are  not  guaranteed  to  do  so.  They  are  exhibited  for 
the  convenience  of  manufacturers  interested.  Examination  in  bulk  may  be 
made  if  desired. 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES. 


725 


CONDITIONS. 

1.  Holders  of  Government  contracts  should  make  application  for  any  lot  or 
lots    (or  portions  thereof)    in  writing  to  E.  W.  Brigham,  298  Summer  Street, 
Boston.     Application  shall  state  the  number  of  the  Government  contract  for 
which  the  wool  is  required,  and  such  other  details  as  may  be  required. 

2.  The  price  on  each  lot  is  the  price  fixed  by  the  Government  and  is  accepted 
by  the  buyer  when  his  application  is  made. 

3.  Terms  are  net  cash  within  60  days  from  date  of  allotment. 

4.  Bags  or  bale  covers  are  to  be  charged  at  cost  and  are  not  to  be  returned. 
The  British  Government  now  charges  for  bale  covers  of  Australian  wools. 

5.  All  wools  or  tops  are  to  be  taken  at  the  same  weights  as  billed  to  the 
Quartermaster  Corps,  which  were  sworn  weigher's  weights  at  time  of  the  de- 
livery of  wool  to  the  Quartermaster  Corps. 

6.  Manufacturers  may  be  required  to  give  a  bond  for  the  full  amount  of  the 
wool  furnished. 

7.  Deliveries  of  all  wool  allotted  to  be  taken  within  30  days  of  date  of  allot- 
ment. 

8.  Storage,  insurance,  and  drayage  charges  applying  against  each  lot  of  wool 
are  to  be  paid  by  the  buyer. 

9.  Cartage  from  warehouse  to  railroad  is  to  be  paid  by  the  buyer. 

THE  GOVERNMENT'S   ISSUE  PRICES  ON   SCOURED   WOOLS. 

1.  The  prices  of  scoured  foreign  wools  grading  58s  and  lower  will  be  July 
30  prices  (as  established  by  the  valuation  committees)  plus  7  per  cent. 

2.  The  prices  of  scoured  foreign  wools  grading  finer  than  58s  will  be  July 
30  prices. 

3.  The  prices  of  scoured  domestic  wools  grading  up  to  and  including  high 
three-eighths  (58s  quality),  and  in  pulled  scoured  up  to  and  including  straight 
As  will  be  July  30  prices  plus  7  per  cent. 

4.  The  prices  of  scoured  domestic  wools  finer  than  high  three-eighths   (58s 
quality),  and  in  pulled  scoured  finer  than  straight  As  will  be  July  30  prices. 


THE  GOVERNMENT'S  ISSUE  PRICES  ON  GREASY  PULLED  WOOLS. 

1.  The  prices  of  greasy  foreign  pulled  wools  grading  58s  and  lower  will  be 
July  30  prices  (as  established  by  the  valuation  committees)  plus  7  per  cent. 

2.  The  prices  of  greasy  foreign  pulled  wools  grading  finer  than  58s  will  be 
July  30  prices. 

3.  The  prices  of  greasy  domestic  pulled  wools  grading  up  to  and  including 
straight  As  will  be  July  30  prices  plus  7  per  cent. 

4.  The  prices  of  greasy  domestic  pulled  wools  finer  than  straight  As  will 
be  July  30  prices. 

THE  GOVERNMENT'S  ISSUE  PRICES  ON  DOMESTIC  WOOLS, 

Ohio  and  similar,  including  New  England  States,  New  York,  Pennsylvania, 
West  Virginia,  Kentucky,  Virginia,  Michigan,  New  Jersey,  Delaware,  Mary- 
land : 

Issue  price, 
scoured  basis. 

Fine  Delaine,   choice $1.  95 

Fine   Delaine,   average 1.  90 

Fine    clothing,    choice 1.  80 

Fine   clothing,   average 1.  75 

Half-blood    staple,    choice 1.  80 


Half-blood   staple,  average 1.  75 

Half-blood    clothing 1.  70 


Issue  price, 
scoured  basis. 
Three-eighths    staple $1  55 


Three-eighths   clothing 

Quarter-blood    staple 

Quarter-blood  clothing 

Low   one-fourth 

Common   and   braid 


Missouri.   Indiana,  Illinois,  and  similar,  including  Iowa,   Wisconsin,   Minne- 


sota, Kansas.  Nebraska,  and  Arkansas: 

Issue  price. 

Fine  Delaine $1.  85 

Fine  clothing,  choice 1.  75 

Fine  clothing,  average 1.  70 

Half-blood  staple 1.  75 

Half-blood  clothing 1.  67 

Three-eighths    staple 1.  52 


Issue  price. 
Three-eighths  clothing $1.  50 

Quarter-blood    staple    1.  40 

Quarter-blood  clothing 1.  38 

Low  quarter-blood 1.  25 

Common  braid 1.  15 


Georgia,  Lake  wools,  and  other  southern  wools : 


Issue  price. 
Average  lots,  largely  3-8ths $1.  37 


Issue  price. 
Average  lots,  largely  1-4  blood $1.  30 


726 


HISTOKY   OF  PRICES   DURING   THE   WAR. 


TERRITORY. 

Issue  price. 
Fine  staple  : 

Choice  ______________________  $1.  90 

Average    ____________________  1.  85 

Inferior  _____________________  1.  80 

Pine  clothing  : 

Choice    _____________________  1.  80 

Average  --------------------  1.  75 

Inferior  _____________________  1.  65 

Half-blood   staple: 

Choice  ______________________  1.  80 

Average  _____________________  1.  75 

Inferior  _____________________  1.70 

Half-blood  clothing  : 

Choice  ______________________  1.70 

Average    ____________________  1.  65 

Inferior  _____________________  1.  60 

High  3-8  staple  56-58s  : 

Choice  ______________________  1.60 

Average    _____________________  1.  55 

Inferior    ____________________  1.  50 

Three-eighths  clothing  56-58s  : 

Choice  ______________________  1.  5r> 

Average    ____________________  1.  50 

Inferior    ____________________  1.  45 

Three-eighths  staple  56s  : 

Choice  ______________________  1.55 

Average 
Inferior 

Three-eighths  clothing  56s  : 

Choice     ______________________  1. 

Average    ____________________  1.  47 

Inferior    ____________________  1.  42 

Low    3-8    staple    50-56s  : 

Choice    _____________________  1.50 

Average    ____________________  1.47 

Inferior    ____            ___________  1.  45 

Low  3-8  clothing  50-56s  :    . 

Choice     _____________________  1.  48 

Average    ____________________  1.  45 

Inferior    --------------------  1.  4°, 

High   1-4   48-50s  : 

Choice  ______________________  1.  45 

Average    --------------------  1.  42 

Inferior    _                                 _____  1.  37 


II, 


40 
37 
.  35 

.40 

.  38 
.  35 

1.  38 


TERRITORY. 

Issue  price. 

High  1-4  clothing  48-50s  : 

Choice 

Average 

Inferior 

1-4  staple  46-48s  : 

Choice 

Average 

Inferior 

1-4  clothing  46^488  : 

Choice 

Average 1.  35 

Inferior 1     1.  32 

Low  1-4.  44s  : 

Choice 1.  25 

Average 1  23 

Inferior 1.  20 

Common-braid  40s  : 

Choice 1.  17 

Average 1.  15 

Inferior- _  1.12 

TEXAS. 

12  months  : 

Choice 1.  80 

Average , 1.  75 

Inferior 1.  70 

8  months  : 

Choice 1.  60 

Average 1.  57 

Inferior 1.  55 

6  months  : 

Choice 1.  5«» 

Average 1.  47 

Inferior 1.  45 

CALIFORNIA. 
12  months  : 

Choice 1.  80 

Average 1.  70 

Inferior 1.  60 

8  months  : 

Choice 1.  55 

Average 1.  50 

Inferior 1.  45 

11  w«. — Bucks,   tags,   black,    seedy,   and   other   discount    fleeces   will    l»e   paid   for  at   fair 
prices  fixed  later  by  the  Government. 

THE  GOVERNMENT'S   ISSUE  PRICES  ON   FOREIGN   WOOLS. 
[Argentine,  Montevideo,  Concordia  fleece  wools — Basis  V.   S.  standard   type.] 

Issue  price. 

Good  6s  or  32-36s,  combing  fleece $0.  92 

Good  5s  or  36-40s,  combing  fleece ---  1.  02 

Good  4s  or  44-40s,  combing  fleece 1.  12 

Good  3s  or  46s,  combing  fleece 

Good  50s,  combing  fleece 

Good  56s.  combing  fleece . 1-  50 

Good  1-2  or  58-60s,  combing  §8Mfe flR2*ShSf°~_  1.65 


. 

1.  50 
1.45 

52 


Good  60-64S,  combing  fleece 

Good  64s,  combing  fleece  {JSgg2^~  ~"^-     1.  70 

Good    64s,    clothing 1.65 

AUSTRALIAN  AND  NEW  ZEALAND  CROSSBREDS. 


36s $1.  00 

40s , 1.  05 

44s 1.20 

46s 1.  35 

46-50s  —  1.  42 


50s $1.  -r,0 

50-56s 1.  55 

56s 1.  60 

58s  __  1.75 


ARGENTINE,    MONTEVIDEO.    AND   CONCORDIA   BURRY    COMBING    FLEECE. 


Hurry  6s  or  32-36s  combing  fleece $0.  80 

Burry  5s  or  36-40s  combing  fleece .  86 

Burry  4s  or  44-40s  combing  fleece 1.  02 

Burry  3s  or  46s  combing  fleece 1.  18 

Burry  50s  combing  fleece 1.  22 


Burry    56s $1.34 

Burry  58-60s 1.  50 

Burry  60-64s 1.  55 

Burry  64s 1.  60 

Burry  64s  clothing 1.  45 


In  all  the  above  burrs  are  considered  shrinkage. 

Argentine,  Montevideo,  and  Concordia  good  skirtings,  free  from  bellies,   same  basis 
hurry  combing  fleece. 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES. 


727 


BUENOS    AIRES,    MONTEVIDEO.    CONCORDIA,    PATAGONIA,    AND    SIMILAR 
LAMBS  PRACTICALLY  FREE. 


Buenos  Aires  :  Issue  price. 

Good  36-40s $1.  00 

Good  44-40s 1.  10 

Good  46s 1.  15 

Good  50s „ 1.25 

Good  56s 1.35 

1-2  or  58-60s 1.  40 

64s 1.  40 

Montevideo,     Concordia,     Patagonia, 
and  similar  : 

Good  36-40s 1.  00 

Good  44-40s 1.  10 

Good  46s 1.  15 

Good  50s 1.25 

Good  56s 1.  35 

Good  1-2  blood  or  58-60s 1.  40 

Good  64s 1.  40 

Buenos      Aires — Second-clip      wools, 
practically    free  : 

Good   5s   or   36-40s 1.  00 

Good   4s   or    44-40s 1.  15 

Good    3s   or  46s 1.  20 

Good   50s 1.  30 

Good   56s 1.40 

Montevideo,   Concordia,   Patagonia- — 
Second   clip  : 

5s  or  36-40s 1.00 

4s  or  44-40s 1.  15 

3s  or  46s 1.  25 

50s 1 1.  35 

56s 1.  45 

Buenos  Aires,  Montevideo,  and  Con- 
cordia, and   similar  bellies  : 

5s  or  36-40s .  82 

4s  or  44-40s__ .  98 

3s  or  46s 1.03 


Buenos  Aires,  Montevideo,  and  Con- 
cordia, and  similar  bellies — Con- 
tinued. Issue  price. 

50s 1.  10 

56s 1.  25 

58-60s 1.  35 

64s 1.  40 

Burrs    included    in    shrinkage. 

Punta  Arenas  fleece,  skirted,  Ameri- 
can style  : 

36-40s  combing  fleece 1.  02 

44-40s  combing  fleece 1.  12 

46s 'combing  fleece 1.30 

50s  combing  fleece 1.  40 

56s  combing  fleece 1.  50 

58-60s  combing  fleece 1.  70 

64s  combing  fleece 1.  70 

Punta  Arenas  bellies  and  pieces  : 

36-40s  clothing 1.  00 

44-40s  clothing 1.  10 

46s  clothing 1.  25 

50s    clothing 1.  35 

56s  clothing 1.45 

58-60s  clothing 1.  55 

64s  clothing 1.60 

Foreign  pulled  wools : 

36-40s    combing 1.  05 

44-40s    combing 1.  20 

46s  combing 1.  40 

50s  combing 1.  45 

56s  combing 1.  55 

i  blood,  or  58-60s  combing 1.  65 

Fine*  combing 1.  75 

Greasy  Cape  Merinos  : 

64s  deep  combing 1.  70 

64s  average  fair  combing 1.  63 

64s  good  average  clothing 1.  50 


THE  GOVERNMENT'S  ISSUE  PRICES  ON  AUSTRALIAN  WOOLS— GREASY  FLEECE. 

[Clean  scoured  basis.] 


Type. 

70s. 

66-70S. 

64s. 

60s. 

$1.95 
1.90 
1.85 
1.80 
1.80 
1.78 
1.80 
1.75 
1.75 
1.68 
1.70 
1.60 
1.50 

$1.93 
1.88 
1.83 
1.78 
1.78 
1.76 
1.78 
1.73 
1.73 
1.66 
1.67 
1.55 
1.45 

$1.90 
1.85 
1.80 
1.75 
1.75 
1.75 
1.75 
1.70 
1.70 
1.63 
1.65 
1.50 
1.40 

$1.85 

1.80 
1.75 

Spinners  good  length  free                       

Average  spinners  bright  and  attractive  few  burrs 

Shafty  combing  showy,  bright  but  tender,  free  or  nearly       .  . 

1.70 
1.68 
1.70 
1.65 
1.65 
1.58 
1.60 
1.45 
1.35 

Shafty  combing  sound  but  more  or  less  burry 

Good  top  makers,  irregular  quality  and  length,  but  fairly  free.  . 
Average  top  makers,  irregular  quality  and  length,  but  fairly  free. 

French  combing  few  burrs                       .                

Average  length  combing,  very  burry  or  suitable  for  carbonizing 
French  combing  very  burry  or  suitable  for  carbonizing 

CLOTHING. 


Type. 

80s. 

70s. 

64-70S. 

Extra  super  regular  length  absolutely  free                           

$1.85 

$1.80 

Choice  clothing  absolutely  free 

1.80 

1.75 

$1.65 

1  70 

1.65 

1.55 

Average  clothing  some  fault         .                                          

1.60 

1.55 

1.50 

Faultv  irregular  64-80s 

1.40 

BROKEN  NECKS  AND  PIECES— COMBING. 
[Clean  scoured  basis.] 


Type. 

64s. 

60-6-ls. 

60s. 

Extra  super  combing  Geelong  and  N  E.  types 

$1.80 

$1.75 

$1.70 

Good  length  combing,  sound,  free,  or  nearly  free  

1.75 

1.70 

1.65 

Average  length,  sound,  free,  or  nearly  free  ........                           

1.70 

1.65 

1.60 

Average  length  tender  free  or  nearly  free 

1.60 

1.55 

1.50 

Good  length,  sound,  few  burrs  or  seeds  

1.65 

1.60 

1.55 

Average  length  sound  few  burrs  or  seeds                                            .... 

1.60 

1.55 

1.50 

French  combing,  few  burrs  or  seeds  

1.55 

1.50 

1.45 

Good  length  combing,  very  burry  .  .      .                  

1.60 

1.55 

1.50 

Average  length  combin**  very  burry 

1.50 

1.45 

1.40 

728 


HISTORY   OF  PRICES   DURING  T/HE   WAR. 


STAINED  PIECES  AND  CARBONIZ1N<  I    I'lF.CKS. 
[Clean  scoured  basis.] 


Type. 

64-708. 

60-64S. 

Good  length  carbonizing  bellies  .  . 

$1.25 
1.15 
1.00 
1.50 
1.45 
1.35 
1.25 
1.10 
1.00 
.80 

$1.16 

1.05 
.90 
.40 
.35 
.25 
.15 
.00 
.90 
.70 

Average  length  carbonizing  bellies  

Short  length  carbonizing  bellies  .  . 

Good  length  combing  stained  pieces,  free  or  nearly  free  

Average  length  combing,  free  or  nearly  free  stained  pieces  
Good  length  combing  stained  pieces  burry 

Average  length  combing  stained  pieces,  burry  

Bulky"carbonizing  stained  pieces*^ 

Average  carbonizing  stained  pieces                               

Inferior  carbonizing"stained  pieces 

Carbonizing  charges  not  included. 
SCOURED  WOOLS. 
[Clean  scoured  basis.) 

Type. 

70s  and 
m-          above. 

64-708. 

60-64S. 

$1.60 
1.55 
1.45 
1.50 
1.40 
1.50 
1.45 
1.35 
1.35 
1.30 

Choice  scoured,  good  length,  sound,  free  or  practically  free  
Best  carding  bulky  free 

$1.75 
1.70 
L60 
.65 
.55 
.70 
.60 
.50 
.50 
.40 

$1. 
1. 
1. 
1. 
1. 
1. 
1. 
1. 
1. 
1. 

70 
65 
55 
60 
50 
GO 
55 
45 
45 
35 

Good  carding,  fairly  free  

Good  average  combing  scoured  Queensland  nearly  free 

Average  combing,  scoured,  fairly  free..  .          

Super  clothing  free                                   • 

$1.  75 
1.65 
1.55 

Good  clothing,  free                                     .          

Average  clothing,  nearly  free  

Good  combing  pieces  and  bellies 

Bhivy  fleece  thinly  grown 

Other  scoured  wools  to  be  valued  on  the  basis  of  greasy  wools  of  similar  type. 

COMBING   BELLIES. 
[Clean   scoured  basis.] 


Type. 

64-  70s. 

60-64S. 

60s. 

Super  combing  bellies,  sound,  free  ... 

$1.  70 

$1.60 

$1.50 

Good  length  combing  bellies  sound  free  or  nearly  free 

65 

1  55 

1  50 

Average  length  combing  bellies  free  or  nearly  free,  sound 

.60 

1  50 

1.45 

Good  length  combing  bellies,  more  or  less  burry  or  seedy  

.45 

1.35 

1.30 

Average  length  combing  bellies  more  or  less  burry  or  seedy 

.35 

1  25 

1  20 

French  combing  bellies  more  or  less  burry  or  seedy  

.30 

1.20 

1.15 

Combing  bellies  very  burry 

25 

1  15 

1  10 

MERINO  LAMBS. 

[Clean  scoured  basis.] 

Extra    super   Geelong  lambs,   free $1.70 

Super,    practically    free -> 1.60 

Good   length,   free  or  nearly  free 1.40 

Medium  length,  free  or  nearly  free 1.30 

Short  length,  free  or  nearly  free 

Inferior  length,   kempy,   carbonizing 

MERINO  LOCKS. 

Good  length  locks,  free $1.20 

Average  length  locks,  free 1   10 

Short  length  locks,  free 1   00 

Bulky   looks,   carbonizing 

Average   length  locks,  carbonizing 

Short  length   locks,   carbonizing 

Carbonizing  charges  not  included. 

WEANERS. 


70s. 

60s. 

«.  60 

S1.55 

SI.  50 

1.30 

1.25 

1.20 

TOPS. 

The  Government  has  a  small  amount  of  tops  in  stock, 
upon  application. 


These  will  be  shown  and  priced 


6.  HIDES,  SKINS,  AND  LEATHER. 


The  regulation  of  the  prices  of  hides,  skins,  and  leather  began  with  the  control 
of  imports,  administered  through  the  license  system.  On  December  15.  1917, 
the  Tanners'  Council  of  the  United  States  of  America  (Inc.),  was  designated 
by  the  War  Trade  Board  as  the  consignee  of  hides,  skins,  and  leather  imported 
into  the  United  States.1 

On  March  20,  1918,  the  woolpullers  agreed  to  give  the  Government  an  option 
on  all  skins  pulled  by  them,  at  maximum  prices  fixed  for  April,  May,  and  Juno, 
on  a  basis  of  14  cents  per  square  foot  on  all  leather  suitable  for  jerkins.  At 
the  same  time  prices  were  established  on  four  grades  of  leather  at  16  cents.  18 
cents,  20  cents,  and  23  cents,  the  average  price  for  finished  jerkin  leather  ap- 
proximating 18£  cents.2 

On  May  19,  1918,  the  War  Industries  Board  made  public  the  following  state- 
ment of  its  policy  concerning  the  prices  of  hides,  skins,  and  leather :  * 

As  the  war  needs  of  the  Government  for  leather  products  of  various  kinds  are 
so  large  as  to  necessitate  some  measure  of  control  over  the  hide  and  leather 
industry,  a  meeting  was  called  of  those  interested  in  the  hide  business  for  the 
purpose  of  discussing  ways  and  means  of  stabilizing  the  prices  of  hide  and  skins. 

At  this  meeting  were  representatives  of  the  Cattle  Men's  Association,  the  Hide 
and  Skin  Importer's  Association,  the  packers,  the  country  hide  dealers,  the  hide 
brokers,  and  the  Food  Administration. 

DIFFERENCES    OF    OPINION    ADJUSTED. 

While  there  was  great  difference  of  opinion  among  the  various  interests  rep- 
resented as  to  what  a  fair  and  reasonable  maximum  price  on  hides  and  skins 
should  be  for  the  next  90  days,  the  representatives  of  the  industry  as  a  com- 
mittee of  the  whole  finally  recommended  to  the  price-fixing  committee  of  the 
War  Industries  Board  the  maximum  prices  on  the  attached  schedules  to  be 
established  by  the  Government  on  hides  and  skins. 

After  several  meetings  and  lengthy  discussions  the  price-fixing  committee,  with 
exhaustive  information,  not  only  as  to  the  present  position  of  the  industry  but 
as  to  the  near -future  developments,  finally  concluded  that  the  prices  named  on 
the  kill  for  May,  June,  and  July,  while  a  little  higher  than  their  differential 
value  of  the  present  stock  and  the  present  market  prices,  were  reasonable,  so 
the  Government  has  adopted  the  schedule  of  maximum  prices  as  they  relate  to 
present  stocks  of  domestic  hides  and  skins,  and  to  the  kill  for  May,  June,  and 
July. 

As  the  Government,  through  an  import-license  system,  exercises  full  control 
over  all  imported  hides  and  skins,  the  price-fixing  committee  has  fixed  maximum 
prices  until  July  31  on  hides  and  skins  similar  to  those  produced  in  this  country 
at  the  same  price  fixed  for  our  domestic  producers,  and  all  other  hides  and  skins. 
as  per  list  attached.  This  differs  somewhat  from  the  views  expressed  by  the 
hide  committee  regarding  the  fixing  of  prices  on  imported  hides  and  skins. 


1  War  Trade  Board  Journal,  Jan.  8,   1918.      For  the  rules  governing  the  administration 
of  the  licenses  see  bulletins  issued  by  the  Tanners'  Council,  Dec.  20,  1917,  and  Feb.  28, 

-  Report   of   the   hides,    leather,    and   tanning  materials    section    of   the    W;ir   Industries 
F.onrd  to  Chairman  Baruch,  Jan.   1,  1918. 
Official  Bulletin,  May   19,   1918. 

729 


730  HISTORY   OF   PRICES    DURING   THE    WAR. 

FUTURE   MEETING   ARRANGED. 

A  meeting  will  be  held  two  weeks  before  the  expiration  of  the  present  agree- 
ment, which  expires  July  31,  1918,  for  the  purpose  of  considering  the  situation 
and  with  a  view  of  fixing  maximum  prices  for  a  further  period. 

The  price-fixing  committee  will  call  a  meeting  of  the  tanners  at  once  with  a 
A  iew  of  establishing  fair  and  equitable  prices  on  leather,  and  will  endeavor  to 
see  that  leather  products  will  reach  the  consumer  at  fair  and  equitable  prices. 

The  supervision  and  carrying  into  effect  of  the  decision  of  the  price-fixing  com- 
mittee will  be  executed  by  the  hide  and  leather  section  of  the  War  Industries 
Board. 

In  June,  1918,  the  War  Trade  Board  restricted  the  importation  of  hides  and 
skins,  tanned  skins,  leather,  and  manufactures  of  leather.  All  licensees  were 
required  to  give  an  option  to  the  Government  at  the  fixed  prices. 

Action  to  restrict  importations  of  hides,  skins,  leather,  tanned  skins,  and 
manufactures  of  leather  has  been  taken  by  the  War  Trade  Board,  which  have 
revoked  all  outstanding  import  licenses  for  hides,  skins,  leather,  tanned  skins, 
and  manufactures  of  leather  as  to  ocean  shipments  after  June  15,  1918.  Here- 
after no  licenses  for  shipments  from  overseas  will  be  issued  except  for — 

(a)  Shipments  from  South  America  of  57.000  long  tons  of  cattle  hides  of 
specified  weights  and  grades. 

(&)  Shipments  of  other  grades  of  hides  or  skins  from  any 'Allies  or  neutral 
countries  as  may  be  certified  by  the  War  Industries  Board  to  be  for  Govern- 
ment use. 

(c)  Shipments  of  leather,  tanned  skins,  or  manufactures  of  leather  as  may  be 
certified  by  the  War  Industries  Board  to  be  for  Government  use. 

The  usual  exceptions  for  shipments  overland  or  by  lake  from  Canada,  over- 
land from  Mexico,  or  as  back  haul  from  European  ports  when  loaded  at  con- 
venient ports  and  without  delay  are  made. 

The  licenses  covering  the  foregoing  shipments  will  be  issued  according  to  such 
allocations  of  the  various  commodities  as  may  be  made  by  the  hide  and  leather 
control  section  of  the  War  Industries  Board.  All  importers  of  the  foregoing 
commodities  are  to  be  required  as  a  condition  precedent  to  the  indorsement  of 
bills  of  lading  by  the  Tanners'  Council  to  give  the  United  States  an  option  to 
purchase  such  of  these  commodities  on  which  a  maximum  price  has  been  estab- 
lished by  the  price-fixing  committee  appointed  by  the  President  at  prices  so 
fixed.1 

The  lifting  of  control. — The  regulation  of  the  prices  of  foreign  hides  and 
skins  was  discontinued  January  1,  1919. 

Fixed  prices  on  domestic  hides  and  skins  expired  by  limitation  on  January 
31,  1919. 

War  Trade  Board  Ruling  No.  43,  dated  December  20,  1918,  revoked  the  restric- 
tions of  July  16,  1918,  and  on  January  9,  1919,  the  board  announced  that  the 
import  licenses  for  hides  and  skins  would  be  issued  thereafter  without  the 
provision  that  the  bill  of  lading  be  indorsed  to  the  Tanners'  Council.  (War 
Trade  Board  Ruling  492.) 

PRICE    SCHEDULES. 

On  July  23,  1918,  the  price  schedules  for  August,  September,  and  October 
were  announced,  providing  the  following  changes  in  the  earlier  schedules.2 

The  following  price  changes  were  agreed  upon  at  a  meeting  of  the  hide  inter- 
ests in  the  United  States  with  the  price-fixing  committee  of  the  War  Industries 
Board  on  July  19,  1918 : 

Packer  hides. — Heavy  native  steers,  No.  1,  30  cents ;  heavy  butt-branded 
steers,  No.  1,  28  cents;  heavy  Texas  steers,  No.  1,  28  cents;  heavy  Colorado 
steers,  27  cents ;  light  native  cows,  No.  1,  24  cents. 

1  War  Trade  Board   Ruling  141,  June  16,   1918. 

2  Official  Bulletin,  July  23,  1918. 


GO  VEHEMENT  REGULATIONS  RELATING   TO  PRICES.  731 

PRICES   OF   COUNTRY    HIDES. 

Country  hides  (for  best  sections). — Extremes,  25  to  45  pounds,  22  cents; 
buffs,  45  to  60  pounds,  21  cents. 

All  country  hides  are  to  be  bought  and  sold  on  a  selected  basis. 

River  Plate  Frigorifico  hides. — Maximum  price  on  steers,  $53  Argentina 
gold;  maximum  price  on  cows,  $40  Argentina  gold  (f.  o.  b.  shipped,  including 
export  duty  and  lighterage,  but  not  including  salting  charges). 

The  new  schdule  applies  to  August,  September,  and  October  take-off  on  all 
domestic  hides  and  skins,  and  August,  September,  and  October  shipment  from 
origin  of  all  foreign  hides  and  skins. 

BASIS    FOB   DIFFERENTIALS. 

These  prices  are  the  basis  for  all  other  differentials,  which  will  be  pub- 
lished in  due  course.  These  readjustments  of  maximum  fixed  prices  will  more 
nearly  equalize  the  actual  market  conditions  as  reflected  in  prices  of  country 
hides  and  need  not  affect  the  prices  of  cattle.  There  have  been  widespread  com- 
plaints that  the  small  hide  producer  has  been  unable,  owing  to  marketing  con- 
ditions, to  secure  a  fair  price  for  his  hides.  The  War  Industries  Board  has, 
therefore,  under  consideration  the  appointment  by  permit  of  hide  dealers,  simi- 
lar to  the  system  adopted  in  wool. 

Definition  of  maximum  prices. — On  August  13,  1918,  the  chief  of  the  hide, 
leather,  and  leather  goods  division  of  the  War  Industries  Board  issued  the  fol- 
lowing statement  concerning  the  nature  of  "  maximum  "  prices : 

It  should  be  understood  that  maximum  prices  do  not  mean  fixed  prices. 
Maximum  prices  merely  establish  a  level  beyond  which  commodities  or  grades 
and  selections  of  commodities  can  not  sell,  and  are  established  to  stabilize  the 
industry  in  order  to  protect  the  industry,  the  Government,  and  the  community 
at  large  against  a  runaway  market. 

Within  the  Maximum  prices  the  law  of  supply  and  demand  should  have  its 
influence  on  trade  prices  of  all  commodities  or  grades  and  selections  of  com- 
modities. The  price-fixing  committee  does  not  intend  that  maximum  prices 
shall  obtain  unless  such  prices  are  justified  by  the  law  of  supply  and  demand. 

In  fixing  maximum  prices  on  leather,  the  price-fixing  committee  has  and  will 
endeavor  to  cover  all  important  kinds,  grades,  and  selections,  and  provides  the 
means  to  fix  maximum  prices  for  all  possible  differentials. 

In  all  cases  where  differential  kinds,  grades,  and  selections  present  them- 
selves on  the  market  and  an  agreement  as  to  their  relative  value  compared 
with  the  nearest  kind,  grade,  or  selection  for  which  maximums  have  been  fixed 
can  not  be  arrived  at  to  the  satisfaction  of  buyer  and  seller,  the  facts  should  be 
referred  to  the  hide,  leather,  and  leather-goods  division  of  the  War  Industries 
Board  for  consideration,  and,  if  necessary,  for  submission  to  the  price-fixing 
committee  for  decision. 

The  prices  established  for  November  and  December,  1918,  and  January,  1919, 
were  announced  on  October  30,  1918.1 

The  price-fixing  committee  of  the  War  Industries  Board  has  established 
maximum  prices  on  packer  and  country  hides  and  skins  for  November,  Decem- 
ber, and  January  take-off.  This  action  has  been  taken  after  several  confer- 
ences with  representatives  of  the  producers,  tanners,  packers,  country  hide 
dealers,  and  also  Government  departments,  which  are  vitally  interested.  The 
basis  of  prices,  as  compared  with  August,  September,  October  maximum 
prices,  remains  unchanged,  but  differentials  have  been  established  to  corre- 
spond to  the  poorer  quality  of  the  hides  as  they  go  into  the  winter  season. 
The  basic  prices,  as  established  for  November,  December,  and  January  take- 
off are  mentioned  below ; 

November,  December  country  hides  and  kips  are  three-quarters  cent  less, 
and  January  hides  are  a  cent  and  one-half  less  than  August,  September,  Octo- 
ber, and  packers  are  1  cent  less  for  November,  December  and  2  cents  less  for 
January. 

All  44-cent  calfskins  are  lowered  to  40  for  November,  December,  January, 
and  other  calf  have  been  lowered  correspondingly. 

Imported  wool  sheepskins  and  imported  pickled  sheepskins. — The  importer 
will  be  required  to  sign  as  follows  at  the  time  he  applies  for  a  license: 

"  In  consideration  of  license  being  granted  by  the  War  Trade  Board  for  the 
importation  of  wool  sheepskins  and  pickled  sheepskins,  we  agree  that  we  will 

1  Official  announcement  of  price-fixing  committee,  Oct.  30,  1918. 


732  HISTORY   OF  PRICES   DURING  THE   WAR. 

not  sell  them  in  excess  of  their  value  relative  to  the  various  kinds  and  selec- 
tions that  have  been  established  on  domestic  pelts  by  the  price-fixing  committee 
appointed  by  the  President." 

HIDES  AND  SKINS. 

Below  are  given  the  regulations  and  schedules  of  fixed  prices  announced  on 
the  indicated  dates  by  the  various  price-fixing  agencies. 

DOMESTIC  PACKER  HIDES. 

[Regulations  for  take-off  of  May,  June,  and  July,  1918.] 

Maximum  prices  for  special  reselections  of  packer  steers  and  cows  for  belting, 
carriage,  furniture,  or  harness  leather  purposes  are  1  cent  over  the  maximums 
for  regular  selections  and  grades. 

Beginning  June  1  take-off  all  small  packers,  abattoirs,  and  wholesale  butchers 
are  governed  by  standard  packer  selections,  and  shall  make  the  same  grades, 
selections,  and  tare  as  standard  packers  make.  Their  maximum  prices  shall  be 
relative  to  best  standard  packer  maximum  prices,  and  shall  be  based  on  Chicago 
freight.  Chicago  freight  basis  in  States  of  California,  Washington,  Oregon,  and 
Nevada  means  that  the  seller  shall  deduct  f  cent  per  pound  (being  three-fourths 
of  present  freight  East,  which  is  1  cent)  from  the  invoice,  or  take  this  amount 
into  consideration  when  naming  his  selling  price.  In  all  other  States  "  Chicago 
freight  basis"  means  that  the  seller  allows  the  buyer  any  excess  freight  on 
shipment  over  the  amount  which  could  be  charged  on  such  shipment  \vere  it 
shipped  from  Chicago,  and  if  freight  charged  from  point  of  shipment  does  not 
exceed  that  from  Chicago,  no  allowance  is  made,  neither  is  any  allowance  made 
if  the  freight  is  less  than  from  Chicago. 

Transactions  at  a  flat  price  in  packer,  abbattoir,  and  wholesale  butcher  hides 
of  May,  June,  and  July  take-off  shall  be  operative  for  the  May  hides  only.  Be- 
ginning June  1  the  flat  prices  shall  be  adjusted  to  graded  and  selected  basis, 
taking  into  consideration  Chicago  freight. 

Tanners  are  not  permitted  to  buy  green  or  slack-cured  stock  of  butchers  (ex- 
cepting packers,  abattoirs,  and  wholesale  butchers),  unless  at  20  per  cent  less 
on  hides  and  kips  and  12£  per  cent  less  on  skins  than  the  maximum  green  salted 
prices. 

Tanners  are  not  permitted  to  buy  green  salted  hides,  kips,  or  skins  of  a 
butcher  in  less  than  carload  lots  at  a  higher  price  than  10  per  cent  less  than  than 
the  maximum  green  salted  prices. 

Packer,  abattoir,  and  country  coast  (California,  Oregon,  Washington,  and 
Nevada)  hides  shall  first  be  offered  to  coast  tanners  having  Government  con- 
tracts, and  those  tanners,  if  they  wish  to  buy  the  hides,  must  give  decision 
within  48  hours  after  receipt  of  the  offering. 

Small  packer,  abattoir,  and  wholesale  butcher  hides,  which 'have  been  resalted, 
shall  be  so  described  when  offered  for  sale. 

The  maximum  prices  on  Canadian  packer  hides  are  to  correspond  with  do- 
mestics of  similar  merit  and  description  ("Canadian  hides"  embrace  those 
from  other  North  American  British  possessions). 

Hawaiian  hide  prices  are  ex-store  San  Francisco,  usual  quality,  and  selection. 

For  the  take-off  of  August,  September,  and  October  the  regulations  were  essen- 
tially the  same  as  those  governing  the  May,  June,  and  July  take-off  with  the 
following  modifications : 

Any  resalted  packer,  abattoir,  or  wholesale  butcher  calfskins  shall  sell  at 
relatively  less  than  the  price  of  44  cents,  which  is  for  first  salt  standard  packer 
stock  on  Chicago  freight  basis. 

A  go-between  can  not  charge  a  brokerage  to  both  buyer  and  seller.  No  one 
owning  a  lot  of  hides  or  skins  can  charge  his  customer  a  brokerage  when  selling 
same.  Any  tanner  may  pay  an  agent  a  brokerage  for  buying  hides  or  skins 
(except  on  hides  or  skins  which  the  agent  owns  himself),  but  such  agent  may  not 
buy  less  than  carload  lots  of  butchers  at  a  higher  price  than  10  per  cent  under 
applicable  maximum  prices.  No  brokerage  shall  exceed  2  per  cent. 

The  prices  on  packers  bulls  are  now  on  a  selected  basis,  whereas  formerly 
they  were  on  a  flat  basis. 

The  modifications  in  general  regulations  for  the  November,  December,  and 
January,  1919,  take-off  are  as  follows: 

All  first  salt  hides  and  kips  of  small  packers,  abattoirs,  wholesale  butchers, 
and  also  good  lots  of  city  and  country  butchers,  of  standard  packer  pattern, 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


733 


trim  and  conditions,  containing  not  over  7  per  cent  No.  2's  for  cuts,  may  be  gov- 
erned by  standard  packer  prices,  Chicago  freight  basis.  Any  excess  over  7  per 
cent  No.  2's  for  cuts  in  such  lots  shall  go  at  the  No.  2  country  price.  Standard 
packer  grading,  selection,  and  tare  shall  govern.  Chicago  freight  basis  in  States 
of  California,  Washington,  Oregon,  Nevada,  Idaho,  and  Utah  means  that  the 
seller  shall  deduct  three-fourths  of  a  cent  per  pound  from  the  invoice,  or  take 
this  amount  into  consideration  when  naming  his  selling  price.  In  all  other 
States  "  Chicago  freight  basis "  means  that  the  seller  allows  the  buyer  any 
excess  freight  on  shipment  over  the  amount  which  could  be  charged  on  such 
shipment  were  it  shipped  from  Chicago,  and  if  freight  charged  from  point  of 
shipment  does  not  exceed  that  from  Chicago,  no  allowance  is  made,  neither  i& 
nny  allowance  made  if  the  freight  is  less  than  that  from  Chicago. 

The  maximum  price  for  resalted  hides  and  kips  as  described  in  paragraph 
No.  1  shall  be  5  per  cent  less  than  the  maximum  for  such  first  salt  hides  and  kips. 

The  maximum  prices  for  resalted  packer,  abbatoir  or  wholesale  butcher,  calf- 
skins shall  be  5  per  cent  less  than  the  maximum  for  such  first  salt  calfskins. 

Maximum  prices  for  special  reselections  of  packer  steers  and  cows  for  belt- 
ing, carriage,  furniture,  or  harness  leather  purposes  are  1  cent  over  the  maxi- 
mums  for  regular  selections  and  grades.  The  premium  of  1  cent  per  pound  over 
the  maximum  allowed  for  special  reselection  of  packer  steers  and  cows  is  only 
permissible  as  follows : 

(a)  When  native  steers  60  pounds  and  up  are  graded  for  weights  60  to  65 
pounds  and  65  pounds  and  up. 

(&)  No.  1  native  steers  50  to  60  pounds  and  60  pounds  and  up,  free  of  grubs 
when  every  hide  is  grubbed. 

(c)  No.  1  heavy  native  cows,  free  of  grubs  when  every  hide  is  grubbed. 

(d)  No.  1  light  native  cows,  free  of  grubs  when  every  hide  is  grubbed. 

(e)  Plump  narrow  hides  picked  out  of  native  steers,  60  pounds  and  up. 

(f)  Spready  hides  picked  out  of  native  steers,  60  pounds  and  up. 

It  shall  not  be  permissible  to  exceed  the  maximum  prices  by  paying  relatively 
more  than  same  for  green  or  slack-cured  weight. 

DOMESTIC   PACKER   HIDES. 


Description. 

Stocks 
and 
take-off 
to  and 
including 
Apr.  30, 
1918. 

Take-off  for— 

May, 
June, 
and 
July. 

August, 
Septem- 
ber, and 
October. 

Novem- 
ber and 
Decem- 
ber. 

January, 
1919. 

Hcavv  native  steers  No.  1                   

$0.29 
.30 
.28 
.21 
.26* 
.25* 

$0.33 
.34 
.32 
.25 
.31 
.30 

$0.30 
.31 
.29 
.24 
.28 
.27 

$0.29 
.30 
.28 
.23 
.27 
.26 
.22 
.26 
.25 
.22 
.27 
.26 
.23 
.22 
.27 
.23 

<8 

.26 

:g 

.40 

$0.28 
.29 
.27 
.22 
.26 
.25 
.21 
.25 
.24 
.21 
.26 
.25 
.22 
.21 
.26 
.22 
.19* 
.17* 

.25 
.23i 
.20* 
.40 

Heavy  native  steers  spready  No.  1       

Light  native  steers  No  1 

Extreme  light  native  steers,  No.  1  

Heavy  butt-branded  steers  No  1 

Light  butt-branded  steers  No  1 

Extreme  light  butt-branded  steers,  No.  1        

Heavy  Colorado  steers  No  1 

.25* 

.5} 

.30 
.29 

.27 
.26 

Light"  Colorado  steers,  'No.  1                             

Extreme  light  Colorado  steers  No  1 

Heavy  Texas  steers,  No.  1             .             

.29 
.25 
.19 
.18| 
.24 
.21 
.20 
.18 

.31 
.30 
.25 
.25 
.30 
.26 
.23 
.21 

.371 

-26 
.23 

.44 

May. 

.29 
.24 

.32 

.26 

.28 
.27 
.24 
.23 
.28 
.24 
.21* 
.19* 

.27 

•  22* 
.44 

Light  Texas  steers,  No.  1 

Extreme  light  Texas  steers  No  1 

Branded  cows,  No.  1                                         .... 

Heavy  native  cows  No  1 

Light  native  cows,  No.  1  .                      

Native  bulls.  No.  1 

Branded  bulls  No  1 

All  Koshers,  at  *  cent  discount. 
Kips,  No.  1 

Overweight  kips,  No.  1                   

Branded  kips,  No  1                                               

Calfskins,  No  1                                                             .  f  

Pacific  coast—  Oregon,  Washington,  California: 
Maximum  price  at  shipping  point  — 
Steers,  flat  
Cows,  flat                               

,a» 

.18 

.'32 
.  26 

Hawaii  : 
Honolulu  — 
Steers,  40  pounds  and  up  
Steers  under  40  pounds  and  cows  all  weights. 
Hilo  and  other  packer  hides- 
Steers 

Flat. 
.30 
.25 

.26 
.21 

.29 
.24 

.25 
.20 

.29 
.24 

.25 
.20 

Cows  i  .  . 

734  HISTORY  OF  PRICES  DURING  THE  WAR. 

% 

DOMESTIC  COUNTRY  HIDES. 

Rules  regarding  the  sale  of  country  hides  for  the  take-off  of  May,  June,  and 
July,  1918: 

Dealers  who  accumulate  hides,  kips,  and  skins  from  various  sections  shall, 
when  offering  such  merchandise,  state  where  same  originated  and  sell  such  mer- 
chandise of  each  section  in  accordance  with  the  schedule  of  maximum  prices 
applicable  thereto.  When  various  sections  are  sold  all  together  as  one  lot  the 
price  shall  be  the  price  of  the  district  and  kind,  according  to  the  schedule,  which 
commands  the  least. 

The  maximum  prices  in  the  schedule  for  country  domestic  green  salted  and 
dry  hides  are  based  on  carload  lots  at  point  of  shipment. 

In  country  hides,  sold  on  a  selected  basis,  a  hide  with  one  grub  is  a  grubby 
hide. 

A  butt-branded  hide,  in  hides  sold  on  a  selected  basis,  is  a  No.  2. 

The  maximum  price  on  black  hides,  special  selection  suitable  for  robes,  is  23 
cents  flat. 

Weights  25  to  50  pounds  (not  over  41  pounds  average)  are  one-fourth  cent  less 
than  weights  25  to  45  pounds  of  the  same  kind,  excepting  where  the  price  for 
45  to  60  is  the  same  price  as  that  for  25  to  45. 

The  designation  of  "  mostly  or  practically  free  of  grubs,  but  no  mention  for 
hair  "  is  changed  to  "  not  over  15  to  20  per  cent  grubby." 

Maximum  prices  on  Canadian  country  hides  are  to  correspond  with  domestics 
of  similar  merit  and  description.  ("  Canadian  hides  "  embrace  those  from  other 
North  American  British  possessions.) 

It  is  recommended  that  the  practice  of  curing  hides  in  vats  be  stopped. 

When  hides  are  sold  to  be  free  of  ticks  and  not  over  50  per  cent  ticky  hides 
are  found  on  a  beam-house  selection,  the  buyer  will  accept  the  ticky  hides  at  not 
over  the  applicable  maximum  price  of  ticky  hides,  but  if  more  than  50  per  cent 
ticky  hides  are  found  on  the  beam-house  selection,  the  entire  lot  must  be  billed 
at  not  over  the  applicable  maximum  price  for  ticky  hides. 

When  sales  are  made  of  hides  not  over  15  to  20  per  cent  grubby  and  are  found 
at  destination  to  exceed  20  per  cent  grubby,  the  excess  over  20  per  cent  up  to 
50  per  cent  shall  be  at  the  maximum  price  for  grubby  hides.  If  at  destination 
the  percentage  of  grubby  is  found  to  exceed  50  per  cent,  the  seller  shall  bill  the 
entire  shipment  at  the  maximum  price  for  grubby  hides. 

The  following  modifications  occur  in  the  regulations  for  the  take-off  of  August, 
September,  and  October: 

Tanners  are  not  permitted  to  buy  green  or  slack-cured  stock  of  butchers  (ex- 
cepting packers,  abattoirs,  and  wholesale  butchers)  unless  at  20  per  cent  less  on 
hides  and  kips  and  12£  per  cent  less  on  skins  than  the  maximum  green  salted 
prices. 

Tanners  are  not  permitted  to  buy  green  salted  hides,  kips,  or  skins  of  a 
butcher  in  less  than  carload  lots  at  a  higher  price  than  10  per  cent  less  than  the 
maximum  green  salted  prices. 

All  hides  and  skins  must  be  bought  and  sold  on  a  selected  basis. 

The  general  regulations  regarding  the  sale  of  country  hides  for  November, 
•December,  and  January,  1919,  follow: 

All  hides  and  skins  must  be  bought  and  sold  on  selection.  The  actual  selec- 
tion must  be  made. 

Dealers  who  accumulate  hides,  kips,  and  skins  from  various  sections  shall, 
when  offering  such  merchandise,  state  where  same  originated  and  sell  such  mer- 
chandise of  each  section  in  accordance  with  the  schedule  of  maximum  prices 
applicable  thereto.  When  various  sections  are  sold  all  together  as  one  lot  the 
price  shall  be  the  price  of  the  district  and  kind,  according  to  schedule,  which 
commands  the  least. 

The  maximum  price  on  black  hides,  special  selections  suitable  for  robes  is 
1  cent  over  the  regular  maximum  for  the  same  grade. 

^No  tanner  is  allowed  to  pay  a  brokerage  or  other  compensation  on  country 
hides,  kips,  calf,  goat  or  sheep  pelts,  dry  or  green  salted,  or  on  horsehides 
when  the  cost  to  the  tanner,  including  such  brokerage  or  other  compensation, 
exceeds  the  prescribed  maximum.  A  go-between  can  not  charge  a  brokerage  to 


GOVERNMENT   REGULATIONS   RELATING   TO    PRICES. 


735 


both  buyer  and  seller.  No  one  owning1  a  lot  of  hides  or  skins  can  charge  his 
on  stonier  a  brokerage  when  selling  same. 

No  dealer  or  tanner  is  allowed  to  buy  less  than  carload  lots  within  5  per  cent 
of  maximum  prices. 

Domestic  August,  September,  and  October  take-off  hides,  kips,  calf  and  goat 
skins,  and  horsehides  not  sold  on  or  before  December  1  shall  be  governed  by 
November  and  December  prices.  Domestic  November  and  December  take-off 
hides,  kips,  calf  and  goat  skins,  and  horsehides  not  sold  on  or  before  February  1 
shall  be  governed  by  January*  1919,  prices. 

Thirty-six  thousand  pounds  of  green  salted  hides  and  skins  shall  constitute 
minimum  carload.  Twenty  thousand  pounds  dry  hides  and  skins  shall  consti- 
tute minimum  carload. 

It  shall  not  be  permissible  to  exceed  the  imiximum  prices  by  paying  rela- 
tively more  than  same  for  green  or  slack  cured  weight. 

All  the  other  regulations  governing  the  sale  of  country  hides  are  similar  to 
the  provisions  of  the  August,  September,  and  October  maximum-price  schedule. 

DOMESTIC  COUNTRY  HIDES. 


Description. 

Stocks  and  take-off 
to  and  including 
Apr.  30,  1918. 

Take-off  for— 

Grubby, 
long 
hair, 
poor 
season. 

Not  over 
15  to  20 
per  cent 
grubby. 

May, 
June, 
and 
July. 

August, 
Septem- 
ber, and 
October. 

November 
and 
December. 

January, 
1919. 

Best  sections,  such  as  Ohio  and  Middle 
West  (including   West   Virginia  and 
Pennsylvania): 
Extremes,  25  to  45  pounds,*No.  1  
Buffs,  45  to  60  pounds  No  1 

JO.  19 
.18 

.20 
.18 

.18 
.14 

$0.21 
.19 

.21 
.19 

.19 
.15 

$0.22 
.22 

.28 

$0.22 
.21 

.24 
.23 
.23 

$0.22* 
.20* 

.23* 
.22* 
.22} 

$0.20* 
.19* 

.22* 
.21* 
.21* 

Heavy  native  steers,  60  pounds  and 
up,  No.  1     

Light  native  steers,  50  to  60  pounds, 
No.  1    

Heavy  native  cows,  60  pounds  and 
up,  No.  1  

:f? 

Bulls  all  weights 

Bulls  60  pounds  and  up  No  1 

.17 
.24 

.44 

3 

.40 

.15* 
.22* 

.40 

Kips,  15  to  25  pounds  No  1 

.24 

.27 

.24 

Caff,  8  to  15  pounds,  city  first  salt, 
equal  to  Chicago  No  1 

Calf,  outside   city  ' 

.37* 
.34 
2.50 
2.30 

.38* 
.35 
2.60 
2.40 

.38* 
-34 
2.70 
2-50 

Calf,  country,  No.  1  

.34 
2.70 
2.50 

:S8 

.23* 
.22* 

.22* 
.16* 
.23* 

.44 
.34 
2.70 
2.50 

.34 

2.50 
2.30 

.20* 
.19* 

.an 

.21* 

.21* 

.40 
.34 
2.50 
2.30 

.34 
2.50 
2.30 

•  19f 
.18} 

.21} 
.20} 

.20} 
.14} 
.21} 

.40 
.34 
2.50 
2.30 

Ripe  calf,  7  to  8  pounds 

Deacons  

Kansas,    Illinois,    Missouri,    Iowa,    Ne- 
braska, Wisconsin,  Minnesota,  North 
and  South  Dakota  (western  North  and 
South  Dakota  and  Illinois  not  included 
in  August,  September,  and  October 
take-on): 
Extremes  25  to  45  pounds  No  1 

Buffs,  45  to  60  pounds,  No  1 

Heavy  native  steers,  60  pounds  and 
up   No  1 

Light  native  steers,  50  to  60  pounds, 
No  1 

Heavy  native  cows,  60  pounds  and 
up,  No  1 

Bulls  60  pounds  and  up  No  1 

Kips  15  to  25  pounds  No  1 

Calf,  8  to  15  pounds,  city  first  salt, 
equal  to  Chicago  No  1 

Calf  country  No  1 

Light  calf  7  to  8  pounds 

Deacons 

Southeastern  hides  (Kentucky  to  Florida 
and  Maryland  to  Mississippi  and  Louis- 
iana east  of  Mississippi,  but  excluding 
West  Virginia): 
Ticky— 
Extremes  25  to  45  pounds 

Flat. 
.14 

.14 
.12 
•       .14 
.24 

Flat. 
.16 

.16 
.14 
.16 
.24 

Flat. 

.18| 

.18J 
.15 
.19 
.30 

Buffs,  45  to  60  pounds  (or  45  and 
up) 

BuUs 

Kips  15  to  25  pounds 

Calf.  15  pounds  and  down  .  .  . 

736 


HISTORY   OF  PRICES   DURING  THE   WAR. 

DOMESTIC  COUNTRY  HIDES— Continued. 


Description. 

Stocks  and  take-off 
to  and  including 
Apr.  30,  1918. 

Take-off  for— 

Grubby, 
long 
hair, 
poor 
season. 

Not  over 
15  to  20 
per  cent 
grubby. 

May, 
June, 
and 
July. 

August, 
Septem- 
ber, and 
October. 

November 
and 
December. 

January, 
1919. 

Southeastern  hides—  Continued. 
Free  of  ticks- 
Extremes,  25  to  45  pounds  

Select. 
$0.18* 
.16* 
Flat. 
.13 
.12 
.18 
.31* 

Select. 

*.!& 

Flat. 
.15 
.14 
.20 
.31* 

Select. 
$0.  21} 
.211 
Flat. 
.17 
.15 
.21* 

Buffs,  45  to  60  pounds. 

Native  bulls  

Branded  bulls 

Kips,  15  to  25  pounds 

Calf  

Kentucky,  Tennessee,  Maryland,  North 
Carolina,  Virginia,  District  of  Columbia: 
Extremes,  25  to  45  pounds,  No.  1  

$0.  21* 

.44 
.34 
2.70 
2.50 

» 
.19* 

ij 
:3* 

.31 

3 

$0.  20f 
.19| 
,15f 
.22f 

.40 
.30 
2.50 
2.30 

;S 

.14! 

:£} 

.30 

:! 

$0.20 
.19 
.15 
.22 

.40 
.30 
2.50 
2.30 

.18 
.17 
.14 

.19 
.37 
.30 

.19 
.18 

Buffs,  45  to  60  pounds,  No.  1  

Bulls,  60  pounds  and  up.  No.  1  

Kips,  city  and  country,  No.  1 

Calf,  8  to  15  pounds,   city  first  salt 
equal  to  Chicago,  No.  1  

Calf,  country,  No.  1  

Light  calf,  7  to  8  pounds            .      .  . 

Deacons  

Ticky  hides,  kips,  and  skins  at  2 
cents  per  pound  less  than  free  of 
ticks. 
Florida,  Alabama,  Mississippi,  Georgia, 
South  Carolina,  Louisiana  east  of  Mis- 
sissippi River: 
Ticky  hides- 
Extremes,  25  to  45  pounds  or  30  to  45 
pounds,  No.  1..  

Buffs,  45  pounds  and  up,  No.  1  

Bulls,  60  pounds  and  up,  No.  1  

Kips,  15  to  25  pounds  or  15  to  30 
pounds,  No.  1  

Calf,  city  first  salt,  No.  1  

Calf,  country,  No.  1  

Free  of  ticks,  2  cents  per  pound 
more. 
Texas,  Oklahoma,  Arkansas,  Louisiana, 
west  of  Mississippi  River: 
Extremes,  25  to  40  pounds  or  25  to  45 
pounds,  No.  1 

Flat. 
.15 
.14 
.13 

Flat. 
.18 
.18 
.15 

Flat. 
.19f 

:!? 

Buffs,  40  or  45  pounds  and  up,  No.  1  ... 
Native  bulls.... 

Native  bulls,  60  pounds  and  up  

.17 

Bulls,  60  pounds  and  up,  No.  1  

.14f 

.14 

B  randed  Dulls 

.12 

.  14    j          .15 

Branded  bulls,  60  pounds  and  up  ... 

.15 
.21* 
.32 

Kips,  15  to  25  pounds,  No  1 

.16* 
.24 

.15 
.12 

.  19              .  21* 
.24              .30" 

.16              .16 
.14               .15 

.20f 
.30 

.20 
.30 

Caff,  15  pound's  and  down,  No.  1  

Western  parts  of  North  and  South  Dakota: 
Country  branded  hides  

Bulls... 

Bulls,  60  pounds  and  up  

.15 

Hides,  25  pounds  and  up,side,  branded 
Hides,  25  pounds  and  up,  unbranded 
(except  butt  branded,  which  are 
classed  as  No.  2)  

.17 

.20 

Kips,  G.  S.  branded  States  . 

.20f 

.22f 

.20f 

Kips,  15  to  25  pounds  

.21 

Native,  unbranded  hides. 

,.15f 

.16f 

.19f 

Calf,  city  and  country  

.38* 

Colorado,  Wyoming,  Montana  (including 
Utah  for  May,  June,  July): 
Country  branded  hides 

.15 

.12 

.16 
.14 

.16 
.15 

Bulls  .. 

Bulls,  fiO  pounds  and  tip 

.15 

Kips,  G.  S.,  branded  States  
Kips,  15  to  25  pounds,  No.  1.. 

.20f 

.22| 

.20| 

.21 

.20* 

.19* 

Native  unbranded  hides 

.15| 

.16J 

.19| 

Hides,    25    pounds    and    up,    side 
branded 

.17 

Hides,  25  pounds  and  up,  unbranded 
(except  butt  branded,  which  are 
classed  as  No.  2)... 

.20 

GOVERNMENT   REGULATIONS   RELATING  TO   PRICES. 


737 


DOMESTIC  COUNTRY  HIDES— Continued. 


Description. 

Stocks  and  take-off 
to  and  including 
Apr.  30,  1918. 

Take-off  tor- 

Grubby, 
long 
hair, 
poor 
season. 

Not  over 
15  to  20 
per  cent 
grubby. 

May, 
June, 
and 
July. 

August, 
Septem- 
ber, and 
October. 

November 
and 
December. 

January 
1919. 

Colorado,  Wyoming,  Montana—  Con. 
Calf,  city  and  country,  No.  1  

Flat.    \      Flat. 

Flat. 

$0.38} 

$0.35 
.17J 
.18| 

$0.35 
.17 

.18 

Buffs,  45  pounds  and  up,  No.  1  (no 

Extremes,  25  to  45  pounds,  No.  1  (no 

California,  Oregon,  Washington,  Nevada, 
Idaho,  and  Utah  after  July: 

$0.14 
.15 

$0.  15} 
.16* 

$0.  18} 
.20 

Over  50  pounds                      

Steers  50  pounds  and  up  No  1     .  . 

.23 
.22 
.21 

.20 
.17 

.15 
.23 

.21} 

.14} 
.22} 

.21} 
.20i 

.i9i 

.!& 
.15j 

jaj 

Cows,  60  pounds  and  up,  No.  1  

Extremes  30  to  45  pounds,  No.  1  

Buffs  45  pounds  and  up  No  1 

Native  bulls,  60  pounds  and  up,  No.  1  . 
Bulls,  branded,  60  pounds  and  up, 
No  1                       

.13 

.12 
.23 
.31 

.15 

.14 
.25 
.31 

.17 

.15 
.23 

.37 

Kips,  15  to  30  pounds,  No.  1  
Calf  partly  trimmed 

California,   Nevada,   and    Utah 
cities  and  countries  .  . 

.36 

.36 

Calf,  Portland,  and  Seattle,  trimmed. 
Calf  short  trimmed       

.32 

.32 

.39 

.43 

Oregon,  Washington,  and  Idaho, 
cities  and  countries  

.40 

.40 

Calf  long  trimmed           

39 

Arizona  and  New  Mexico  

.15 

.17 

.18 

Hides,  weights  25  pounds  and  up  

.19 

Extremes,  25  to  45  pounds  No  1  

!l4| 

.19 
.18 
.14 

Buffs,  45  pounds  and  up,  No.  1  

Bulls,  60  pounds  and  up,  No.  1  

Native  bulls  ,  60  pounds  and  up  

.17 

Branded  bulls  60  pounds  and  up.  .  .  . 

15 

Kips,  15  to  25  pounds  ,  No.  1  

:1J 

.35 

:J8! 

.34 

.20 
.30 

.34 

Calf,  15  pounds  down,  No.  1  

No  selection  for  brands  on  Nov- 
ember, December,  and  Janu- 
ary, 1919,  take-off. 
Dry  hides  16  pounds  and  up 

Select. 
35 

Bulls  two-thirds  price  and  glue 
half-price  after  July. 
7  to  16  pounds                 

Flat. 
39 

Kips  7  to  16  pounds,  glue  out.  .  .   . 

.39 

.37 

.37 

Calf.           

45 

Calf  ,  under  7  pounds,  glue  out  

.45 

.21 

.20* 

.43 

3 

.43 

.20 
.19 

New  England  hides  (Maine,  Vermont, 
New  Hampshire,  Massachusetts  ,  New 
York,  Connecticut,  Rhode  Island,  and 
Delaware  and  New  Jersey  after  July): 
Extremes,  25  to  45  pounds,  No.  1  
Buffs,  45  pounds  and  up,  No.  1  

.18 
.16 
.17 

.19 
.17 
.18 

.21 
.21 
.27 

60  pounds  and  up,  No.  1  

.23 

.22} 

.21 

Heavy  cows 

.16 

.17 

.24 

60  pounds  and  up,  No.  1.  ... 

.  22                .  21i 

.20} 

.14 

.15 

.16 

60  pounds  and  up,  No.  1  

.16 
.24 

.18} 
.20 

:Mj 

•a* 

:H 
:!? 

Kips,  including  grassers,  No.  1  
Hawaii,  Honolulu: 
30  to  50  pounds  

.23 

.24 

.25 

.18* 
.20 

50  pounds  and  up  
Stocks  and  take-off  to  and  in- 
cluding Apr.  30,  1918,  30  to  50 
pounds,  $0.18$. 
Stocks  and  take-off  to  and  includ- 
ing Apr.  30,  1918,  50  pounds  and 
up,  $0.20. 

125547°— 20 47 


738 


HISTORY  OF  PRICES  DURING  THE   WAR. 

CALFSKINS. 


The  maximum  prices  set  on  large  city  first-salt  skins,  outside  city  skins,  and  country  skins  do  not  apply 
to  the  Pacific  coast. 

Other  eastern  trimmed  calfskins  not  equal  in  all  respects  to  New  York  city  skins  shall  sell  at  relatively 
less,  according  to  their  value.  Nobody  shall  be  allowed  to  give  the  butcher  a  bonus  because  this  practice 
Is  construed  to  mean  paying  more  than  the  maximums. 

DOMESTIC  CALFSKINS  (NOT   OTHERWISE   PROVIDED   FOR). 


Description. 

Stocks  on 
hand  May  1 
and  take-off 
for  May, 
June,  and 
July. 

Take-off  for— 

August, 
Septem- 
ber, and 
October. 

November, 
December, 
and  Jan- 
uary, 1919. 

Chicago  city  first-salt  ca 
Light  calf,  7  to  8  po 
Deacons 

fskins  and  other  large  city  first-salt  calfskins, 
unds 

$0.44 
3.17 
2.97 

3.10 

4.00 
5.00 
6.00 
7.00 
7.50 
125 

$0.44 
3.30 
3.10 

3.10 

4.00 
5.00 
6.00 
7.00 
7.50 
125 

$0.40 
2.95 
2.80 

2.80 
3.60 
4.50 
5.40 
6.50 
6.50 
»15 

New  York  City  trimmed  calfskins  and  other  eastern  city  trimmed 
calfskins  equal  in  all  respects  to  New  York  City: 
4  to  5  pounds 

5  to  7  pounds  

7  to  9  pounds 

• 

9  to  12  pounds  .  .     . 

12  to  17  pounds 

17  to  25  pounds 

Buttermilk  calf 

1  Per  cent  discount. 
DOMESTIC  PICKLED  SHEEP  AND  LAMB  SKINS. 

STOCKS  ON  HAND   MAY  1   AND  TAKE-OFF  FOR   MAY,   JUNE,   AND  JULY,   1918. 

The  schedule  below  is  for  all  green  salted.packer  and  city  butcher  skins  of  strictly  good  take-off.  All 
green  salted  country  butcher  and  city  butcher  skins  showing  poor  take-off  shall  be  selected  on  the  same 
basis,  but  the  price  shall  be  3  cents  per  square  foot  less  than  price  paid  for  the  various  grades  of  strictly 
good  packer  and  city  butcher  take-off. 

All  pickled  skins  to  be  graded  according  to  the  following  specifications,  the  grades  to  be  identified  by 
numbers. 


Grade 
No. 


Description. 


Price. 


Bull  sheep:  Super  heavy,  measuring  over  120  square  feet  and  weighing  45  pounds  and 

over,  per  dozen 

Heavy  sheep:  Heavy  clear  sheep,  measuring  over  110  square  feet,  per  dozen 

Clear  sheep:  Sheep  with  clear,  smooth ,  and  sound  grain,  measuring  over  100  square 

feet,  containing  no  blind  ribs,  no  ribby  skins,  and  free  from  cockle 

Blind  rib  sheep:  All  sheepskins  measuring  over  100  square  feet ,  having  a  blind  rib,  no 

ribby  skins,  or  defective  grain 

Ribby  sheep:  All  other  ribby  sheep  measuring  over  75  square  feet,  no  defective  grain. 
No.  2  sheep:  All  sheep  measuring  over  100  feet  rejected  from  1,  2,  3,  4,  and  5  grades, 

with  poor  and  defective  grain,  value  but  not  to  exceed 

Prime  Iambs:  All  smooth,  clear  lambs,  65  to  100  square  feet,  inclusive,  strictly  good 

pattern;  no  blind  rib  or  ribby  skins;  no  open  grain  skins;  no  torn  skins;  absolutely 

free  from  cockle  and  pinny  skins 

Blind  rib  lambs:  All  lambs  containing  a  blind  rib,  strictly  good  pattern;  no  ribby 

skins  and  no  damaged  grain;  no  torn  skins  and  no  cockle;  75  to  100  square  feet 

Ribby  lambs:  Lambskins  showing  ribby  or  open  grain,  cockle  skins,  and  pinholes 

up  to  75  square  feet 

Small  lambs:  All  lambskins  50  to  64  square  feet,  rejected  from  Nos.  7, 8,  and  9  on 

account  of  size • 

Torn  skins:  All  torn  skins  or  badly  cut  skins  over  50  feet;  all  heated  skins , 

Pieces  and  culls:  All  pieces  and  culls  and  torn  skins  under  50  feet;  all  heated  skins.... 


$0.18 
.16 

.14 

.12 
.11 

.08 


.15 
.14 
.09 

Value. 
Value. 
Value. 


GOVERNMENT   REGULATIONS  RELATING  TO  PRICES. 


739 


DOMESTIC  PICKLED   SHEEP   AND   LAMB   SKINS. 
TAKE-OFF  FOR  NOVEMBER,  DECEMBER,  AND  JANUARY,   1919. 

The  schedule  below  is  for  all  green  salted  packer  and  city  butcher  skins  of  strictly  good  take-off.  All 
green  salted  country  butcher  and  city  butcher  skins  showing  poor  take-off  shall  be  selected  on  the  same 
basis,  but  the  price  shall  be  3  cents  per  square  foot  less  than  price  paid  for  the  various  grades  of  strictly 
good  packer  and  city  butcher  take-off. 

All  pickled  skins  to  be  graded  according  to  the  following  specifications,  the  grades  to  be  identified  by 
numbers: 


Grade 
No. 


Description. 


Present 
price. 


Relative 
value. 


Bull  sheep:  Super  heavy  clear  sheep  measuring  over  120  square  feet 

Heavy  sheep:  Heavy  clear  sheep  measuring  over  110  square  feet 

Clear  sheep:  Sheep  with  clear,  smooth  and  sound  grain,  measuring  over  100 

square  feet,  containing  no  blind  ribs,  no  ribby  skins  and  free  from  cockle. 
Blind  rib  sheep:  All  sheepskins  measuring  over  100  square  feet  having  a 

blind  rib;  no  ribby  skins  or  defective  grain;  slight  cockle 

Ribby  and  cockley  sheep:  All  other  ribby  sheep  measuring  over  100  square 

feet;  slight  grain  damage  and  all  cockle;  skins  not  suitable  for  grade  No.  4 

permitted  if  otherwise  sound , 

No.  2  sheep:  All  sheep  rejected  from  1, 2, 3,  4,  and  5  grades,  with  poor  and 

defective  grain,  value  but  not  to  exceed 

Prime  lambs:  All  smooth,  clear,  lambs  75  to  100  square  feet,  inclusive, 

strictly  good  pattern;  no  blind  rib  or  ribby  skins;  no  open  grain  skins;  no 

torn  skins;  absolutely  free  from  cockle  and  pinny  skins 

Blind  rib  lambs:  All  lambs  containing  a  blind  rib,  strictly  good  pattern;  no 

ribby  skins  jdamaged  grain  or  torn  skins;  slight  cockle,  75  to  lOOsquare  feet. 
Ribby  and  cockley  lambs:  Lambskins  showing  ribby  or  open  grain;  cockle 

skins  and  pinholes,  75  to  100  square  feet 

Small  lambs:  All  lambskins  under  75  square  feet  rejected  from  Nos.  7, 8, 

and  9  on  account  of  size  (relative  value) 

Torn  skins:  All  torn  skins  or  badly  cut  skins  over  60  feet;  all  heated  skins 

(relative  value) : 

Pieces  and  culls:  All  pieces  and  culls,  and  torn  skins  under  50  feet;  all  heated 

skins  (relative  value) 


$0.18 
.16 

.14 
.12 

.11 

.08 

.15 
.14 


SO.  18 
.16 

.14 
.11 

.09 
.07 

.15 
.13 


All  wool  pelts  taken  off  before  November  1,  when  ready  for  sale  in  the 
ruling  as  of  August  1  to  November  1,  providing  a  suitable  affidavit  co 


)ickle,  may  be  sold  at  prices 
the  quantity  and  date  of 


take-off  is  filed  prior  to  November  5,  giving  inventory  of  all  wool  pelts  on  hand  or  in  process  November  1. 

Imported  pickled  sheep  or  lamb  skin  pelts  or  pickled  pelts  reduced  from  imported  wool  skins  to  be 
sold  at  their  value  relative  to  the  various  kinds  and  selections  as  established  above. 

The  number  of  square  feet  mentioned  in  the  various  paragraphs  refers  to  square  feet  per  dozen  skins. 

butcher  skins  of  equal  take-off  win  receive  the  same 


All  country  skins  showing  take-off  equal  to  city 
prices  that  are  allowed  to  city  butcher  skins. 


HORSEHIDES. 

General  regulations. — All  prices  are  f.  o.  b.  shipping  point,  free  of  manes  and  tails. 

Prices  vary  according  to  the  section  of  the  country  and  also  with  the  differences  in  sizes  and  widths  of 
butts  or  lengths  of  shanks. 

For  the  November,  December,  and  January,  1919,  take-off  certain  modifications  were  made,  as  follows: 

City  Tenderers  would  mean  only  such  hides  as  are  actually  taken  off  in  a  rendering  establishment  and 
a  sworn  affidavit  executed  by  a  notary  must  accompany  each  shipment.  City  Tenderers  that  are  taken 
off  in  the  States  of  Virginia,  West  Virginia,  Tennessee,  North  and  South  Carolina,  Georgia,  Alabama, 
Florida,  Mississippi,  Arkansas,  Missouri,  Louisiana,  Oklahoma,  New  Mexico,  and  Arizona,  shall  be  classed 
as  Southern  horsehides  and  shall  sell  for  $6.25  for  Nos.  1  and  2.  Country  horsehides  from  the  above-men- 
tioned States  shall  not  sell  to  exceed  $6,  including  mules.  Any  dealer  accumulating  southern  horsehides 
at  points  along  the  Missouri  and  Ohio  Rivers  must  so  designate  as  same  and  sell  as  such. 

.  DOMESTIC  HORSEHIDES. 


" 

Description. 

Stocks  on 
hand  May  1, 
and  take-off 
for  May,  June, 
and  July. 

Take-off  for— 

August, 
September, 
and  October. 

November, 
December, 
and  January, 
1919. 

Whole  horsehides: 
City  Tenderers— 

$8.00 

Nos  1  and  2                                 

v  $7.50 

$7.50 

Ordinary  cities  and  countries 

$6.75-7.50 

$6.25-  7.00 

$6.25-7.09 

Southerns                                                             

6.00-  6.50 

Nos  1  and  2 

5.50-  6.00 

6.25 
6.00 

•    1  'oni  es  and  glues  ,  half  price  . 
Headless  hides  (one  that  is  trimmed  off  back  of  ears), 
50  cents  less. 

740 


HISTORY   OF   PRICES   DURING  THE   WAR. 

DOMESTIC  HORSEHIDES— Continued. 


Description. 

Stocks  on 
hand  May  1, 
and  take-off 
for  May,  June, 
and  July. 

Take-off  for— 

August, 
September, 
and  October. 

November, 
December, 
and  January  " 
1919. 

Colts  

$0.25-11.00 
4.75-  5.50 

1.15-  1.30 
1.75-  1.90 
2.15-2.30 
2.75-  2.90 

$0.25-$1.00 
4.75-  5.50 

1.15-  1.30 
1.75-  1.90 
2.  15-  2.  30 
2.  75-  2.  90 

Horse  fronts  

$5.  75-J6.  25 

1.25-  1.40 
1.50-  2.00 
2.25-2.50 
2.50-  3.15 

No.  2  and  headless  horse  fronts,  50  cents  less. 
Butts: 
Green  salted- 
Length,  15  to  18  inches    . 

Length,  18  to  20  inches 

Length,  20  to  22  inches         

Length,  22  inches  and  up 

No.  2  and  short  shanks,  25  cents  less. 
Butts  of  different  sizes  and  widths  at  relative  prices. 

FOREIGN    WET    SALTED    HIDES. 

Regulations  for  the  sale  of  stocks  on  hand  May  1,  1918,  and  importations  shipped  up 
to  and  including  July  31,  1918  : 

May,  June,  and  July  shipments  of  foreign  short-haired  hides  taken  off  north  of  the 
Equator  have  maximum  prices  10  per  cent  over  maximum  prices  set.  Hides  on  which 
the  maximum  prices  are  quoted  weighed  and  delivered  should,  when  bought  on  shipping 
weight,  not  cost  relatively  more  than  the  New  York  weighed  and  delivered  basis 
maximum. 

Australian  and  New  Zealand  hides,  having  been  inactive  here  for  a  long  time,  were 
given  nominal  maximums.  If  possibilities  of  actual  business  arise  and  are  brought  to 
the  attention  of  the  hide,  leather,  and  tanning  materials  section  the  matter  will  be  given 
proper  consideration.  A  price  for  New  Zealand  meat  works  has  been  made  below. 

Mataderos  :  Kips,  the  weight  (both  range  and  average)  varies,  and  may  continue  to  do 
so  according  to  custom. 

All  prices  are  quoted  in  cents  per  pound. 

The  following  modifications  occur  in  the  regulations  for  the  sale  of  the  August,  Sep- 
tember, and  October  take-off  : 

All  prices  in  Argentine  gold  are  per  100  kilos  f.  o.  b.  ship,  unless  otherwise  noted,  and 
include  export  duty  and  lighterage,  but  salting  on  ship  is  for  buyers'  account.  Copy  of 
invoice  covering  each  transaction  will  be  required.  No  deviation  may  be  made  from 
these  terms ;  no  buyer  shall  assume  the  export  duty  and  lighterage,  even  though  the  total 
cost  comes  within  the  maximum  price. 

For  the  take-off  of  November  and  December  there  were  the  additional  regulations  : 

A  go-between  may  not  charge  a  brokerage  to  both  buyer  and  seller.  No  one  owning  a 
lot  of  hides  or  skins  may  charge  his  customer  a  brokerage  when  selling  same.  Brokerage 
on  foreign  cattle  hides  and  skins  shall  not  exceed  2  per  cent.  The  brokerage  on  foreign 
goatskins,  sheepskins,  and  other  skins  (excepting  cattle  hides  and  skins)  shall  not  exceed 
3  per  cent. 

Shipments  of  dry  kips  under  12  pounds  and  dry  salted  kips  under  15  pounds,  when 
mixed  with  common  dry  hides  (such  as  Bogota,  Orinocos,  Porto  Cabellas,  La  Guairas, 
Central  Americans,  etc.)  shall  be  sold  at  two-thirds  the  price  of  the  hides,  or  rejected, 
at  buyer's  option.  Shipments  of  dry  kips  under  14  pounds  mixed  with  hides  from 
Mexico,  West  Indies,  and  Peru  shall  be  sold  at  two-thirds  price,  or  rejected,  at  buyer's 
option. 

The  following  schedules  give  the  prices  fixed  by  the  price-fixing  committee  of  the  War 
Industries  Board : 


Stocks  on 

hand 

May  1,  1918, 
and  ship- 

ments from 

Description. 

point  of 
origin  to 

Remarks. 

and 

including 

July  31, 

1918. 

Buenos  Aires  frigorifico: 
Steers  

$0.31* 

Shipping  weight,  c.  i.  f.,  New  York 

basis. 

Cows 

.23 

Do. 

Montevideo  frigorifico: 

Steers 

31.1 

Do. 

Cows.  .     .           

.22 

Do. 

Buenos  Aires  city  matadero  well  taken  off: 

Steers 

.26 

Do. 

Cows... 

.21 

Do.       • 

GOVERNMENT  REGULATIONS  RELATING  TO  PRICES. 


741 


Description. 


Stocks  on 

hand 

May  1,  1918, 

and  ship- 

ments from 

point  of 

origin  to 

and 

including 

July  31, 

1918. 


Remarks. 


Argentine  city  matadero  well  taken  off: 

Steers 

Cows 

Argentine  country  matadero  and  campos: 

Steers 

Cows 

Paraguay  country  matadero  and  campos: 

Steers 

Cows 

Paraguay  city  matadero  and  campos: 

Steers 

Cows 

Montevideo  city  matadero: 

Steers 

Cows 

Buenos  Aires  matadero  kips 

Montevideo  matadero  kips 

Argentine  and  Uruguay  saladero: 

Steers 

Cows 

Rio  Grande  saladero: 

Steers 

Cows 

Sao  Paulo  frigorifico  hides 

Rio  Janeiro  hides 

Bahia  hides 

Pernambuco  hides 

Mlnas  hides 

Venezuela  frigorifico  hides 

Colon  (commissariat)  hides 

Colombia  city  hides 

Panama  hides 

West  Indian  hides 

Guinas  hides 

Havanas  packers'  hides 

Havanas  specials  hides 

Havanas  regular  hides 

Mexico  city  packers'  hides 

Mexico  city  and  neighborhood  hides 

Vera  Cruz  nides 

Vera  Cruz  rastro  hides 

Puebla  hides 

Pachuca  rastro  hides 

Orizaba  hides 

Gueretaro  hides 

Quadalajara  hides 

Oaxaca  hides 

Frontera  hides 

Tabasco  hides 

Campeche  hides 

Laguna  hides 

Northern  Mexican  city  hides 

Tampico  hides 

Progresso  hides 

Chile  (Valparaiso)  hides 

Peru  (Lima)  hides 

China  packers'  (heavy)  hides 

China  packers'  (light)  hides 

Shanghai  hides 

Queensland  butchers'  hides  (nominal) 

Australian  meat  works'  hides  (nominal) 

New  South  Wales  butchers'  hides  (nominal) . 

New  Zealand  hides  (nominal) 

Rangoon  hides  (nominal) 

China  buff alos'  hides 

New  Zealand  meat  works'  hides: 

Steers 

Cows... 


.23 

\2\ 

.21i 
.2lf 
.22 

!20 
.24 
.25 
.27 
.25 
.24 
.22 
.26 
.24 
.26 
.18 
.17 


.26* 


Shipping  weight,  c.  i.  f..  New   York 
basis. 
Do. 

Do. 
Do. 

Do. 
Do. 

Do. 
Do. 

Do. 
Do. 
Do. 
Do. 

Weighedand  delivered  New  York  basis. 
Do. 

Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 

C.  i.  f .  shipping  weight  3  per  cent  shrink- 
age guaranteed. 
Do. 


742 


HISTORY   OF  PRICES   DURING  THE   WAR. 


# 

Description. 

Shipments 
from  origin 
August, 
September, 
and 
October. 

Shipments 
from  origin 
November, 
December, 
and  Jan- 
uary, 1919. 

Buenos  Aires  Frigoriflco: 
Steers  

$53  00 

$61  00 

Cows  

40  00 

44  00 

Montevideo  Frigoriflco: 
Steers  

53.00 

61.00 

Cows  

40  00 

44  00 

River  Plate  Frigorifico  type  steers...  . 

i  4$  50 

i  58  00 

River  Plate  Frigorifico  type: 
4    Cows  

236.00 

243.00 

Kips  

2  38.00 

247.00 

Caff.  

*38.  50 

Argentina  and  Uruguay  Saladero  steers  

50.00 

57.50 

Argentina  and  Uruguay  Saladero  cows  

36.50 

40.00 

Frigorifico  type  Chilians  (Valparaiso)  hides  

3.25 

Habana  and  Santiago  regular  hides.  .  . 

3  20 

Argentine  City  special  Matadero  steers  

4  2gi 

Argentine  Citv  special  Matadero  cows  

4  2oi 

Buenos  Aires  and  Montevideo  Frigorifico  kips,  15  to  25  pounds 

49.00 

Buenos  Aires  and  Montevideo  Frigorifico  kips,  not  over  32  pounds,  average  

47.00 

Buenos  Aires  and  Montevideo  Frigorifico  bulls  ... 

42.00 

Morris  &  Co.,  San  Salvador  hides 

(6) 

(') 

Swift  &  Co.,  Asuncion  hides  

(6) 

(•) 

Montevideo  City  Matadero: 
Steers  

«.28! 

Cows.  .  .  . 

«.22 

Kips 

Extremes  .                  .... 

<.23 

Buenos  Aires  and  extremes  

<.22 

Rio  Grande  Saladero: 
Steers 

56  50 

Cows  

40.00 

Sao  Paulo  Frigorifico  hides. 

3  26$ 

1  10  per  cent  shrinkage  guaranteed. 

2 10  per  cent  shrinkage. 

3  Weighed  and  delivered  at  New  York. 


4  C.  and  f.  New  York  or  Boston.r 

•  Price  shall  be  relative  to  regular  Frigorificos. 


FOREIGN  HORSEHIDES. 


Description. 


Take-off  for 
November 

and 
December, 

1918. 


Chile  and  Buenos  Aires  City  G.  S.  hides: 

Not  under  25  kilos  average  and  free  of  ponies,  colts,  and  glues. . 

(Headless  and  seconds,  50  cents  less.) 
Chile  and  Buenos  Aires  Province  or  Campos: 

About  18  to  20  kilos,  average  and  free  of  ponies,  colts,  and  glues. 
All  China  dry  horsehides: 

No.  1's,  about  16  to  17  pounds,  average 

No.  1's,  about  12  to  13  pounds,  average 

No.  1's,  about  lOpounds,  average 

(No.  2's,  50  cents  less.) 
(No.  3's,  half  price.) 


$7.50 


5.75 

3.50 
2.75 
2.50 


1  C.  and  f.,  shipping  weight. 

FOREIGN  DRY  HIDES. 

Regulations  for  the  sale  of  hides  included  in  the  original  regulations  for  May,  June, 
and  July,  1918  : 

May,  June,  and  July  shipments  of  foreign  winter  haired  dry  hides,  taken  off  south  of 
the  Equator,  have  maximum  prices  10  per  cent  over- the  maximum  prices  set. 

Cordova  (Argentina)  dry  hides  include  hides  from  Salta,  Santiago  del  Estero,  and 
Metan. 

Maximum  price  of  inservibles  shall  not  be  over  50  per  cent  of  the  maximum  price  of 
the  best  selection  of  the  same  kind. 

Maximum  price  on  all  dry  salted  hides  is  6  cents  less  than  dry  flint  in  all  cases  where 
it  has  been  customary  to  sell  lots  running  all  or  practically  all  dry  sal-ted,  and  in  such 
cases  the  hides  with  pickle  on  them  are  3  cents  under  dry  flints.  In  other  cases  the 
customary  conditions  prevail. 

The  percentages  of  desechos  mentioned  in  Argentine  and  Uruguay  dry  hides  do  not 
apply  to  kip  and  calf.  Kip  and  calf  are  free  of  mal-desechos  and  are  inservibles. 

Venezuela,  Colombia,  Equador,  Central  America,  West  Indies,  San  Domingo,  Haiti,  and 
Porto  Rico  kip,  maximum  price  1  cent  per  pound  over  maximum  price  for  hides  of  the 
respective  countries  ;  calf,  maximum  price  6  cents  over  the  maximum  price  for  hides  of 
the  respective  countries. 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES. 


743 


Bogota  Mount  slaughterhouse  hides  accompanied  by  a  statement  sworn  to  before 
United  States  consul  or  consular  agent  that  they  are  slaughterhouse  hides,  such  state- 
ment to  be  attached  to  invoice  to  United  States  buyer  of  hides  to  have  a  maximum  price 
of  1  cent  more  than  the  maximum  price  ruling  on  Mount  Bogotas. 

Guayaquil  slaughterhouse  hides  accompanied  by  statement  sworn  to  before  a  consul 
or  consular  agent  that  they  are  slaughterhouse  hides,  such  statement  to  be  attached 
to  invoice  to  United  States  buyer.  Maximum  price  to  be  33J  cents  for  dry. 

All  prices  are  quoted  in  cents  per  pound. 

The  schedule  of  maximum  prices  on  hides  and  skins  for  August,  September,  and  Octo- 
ber, 1918,  contains  a  full  list  of  hides  of  this  class.  In  general  it  may  be  said  that 
prices  vary  from  the  lowest  prices  for  West  Indian  dry  hides  to  the  highest  for  Cordovan 
dry  hides.' 

Modifications  of  terms  of  sale  for  this  period  follow  : 

When  prices  are  on  basis  of  New  York  weights,  original  selection,  the  certified  arrival 
weights  shall  govern. 

When  prices  are  on  the  basis  of  c.  i.  f.  or  c.  and  f.  on  original  shipping  weights,  the 
customary  shrinkage  guarantees  shall  govern,  unless  otherwise  specified. 

Cordova  (Argentina)  dry  hides  shall  Include  Santiago  del  Estero,  San  Luis.  Salta, 
and  Metan. 

Maximum  price  on  all  dry  salted  hides  is  6  cents  less  than  dry  flint  in  all 
cases  where  it  has  been  customary  to  sell  lots  running  all  or  practically  all 
dry  salted,  and  in  such  cases  the  hides  with  pickle  on  them  are  3  cents  under 
dry  flints.  In  other  cases  the  customary  conditions  prevail. 

Maximum  price  of  inservible  hides  shall  not  be  over  two-thirds  of  the  maxi- 
mum price  for  hides  of  the  basis  selection  of  the  same  kind. 

Venezuela,  Colombia,  Equador,  Central  America,  West  Indies,  San  Domingo, 
Haiti  and  Porto  Rico  kip,  maximum  price  1  cent  per  pound  over  maximum 
price  for  hides  of  the  respective  countries;  calf,  maximum  price  6  cents  over 
the  maximum  price  for  hides  of  the  respective  countries. 

Prices  quoted  are  cents  per  pound. 

The  prices  for  November  and  December  remain  unchanged. 


FOREIGN  DRY  HIDES. 


Description. 

Stocks  and 
shipments 
from  origin, 
to  and 
including 
July  31, 
1918. 

Remarks. 

$0.54 
.34 

# 

.37 
.46 

.34 
.40 

.32 
.36 

.34 
.40 

# 
•2 

.54 

.30 
.34 
.33 

.34 
.36 
.33 
.33 

I 

.37 
.37 
.30 

J32| 

isij 

C.  and  f.,  New  York  or  Boston. 

Do. 
Do. 
Do. 

Do. 
Do. 

Do. 
Do. 

Do. 

Do. 

Do. 
Do. 

Do. 
Do. 

Do. 

Do. 
Do. 

Do. 
Do. 
Do. 

Do. 
Do. 
Do. 
Do. 
New  York  delivery  and  selection. 

Do! 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 

Buenos  Aires,  W.  H.,  30  per  cent  desechos: 
Hides                                                   

Kips                              

Calf                                                

Cordova,  W.  H.,  15  per  cent  desechos: 
Hides.                        

Kips                                              

Santa  Fe,  W.  H.,  15  per  cent  desechos: 
Hides                             

Kips                                              

Corriente,  W.  H.,  15  per  cent  desechos: 
Hides.                      

Kips                                           

Entre  Rios,  W.  H.,  15  per  cent  desechos: 
Hides.                     

Kips                                                    

Concordia,  W.  H.,  15  per  cent  desechos: 
Hides                                                              

Kips                                     

Montevideo,  W.  H.,  15  per  cent  desechos: 
Uicles                                                          

Kips                                   

Can                                               

Paraguay,  W.  H.,  15  per  cent  desechos: 
Hides                         t  

Kips                                           

Brazil,  W.  H./Rio  Grande  No.  1  selection: 
Hides                                                 

Puerto  Cabello  and'La  Guayra  hides             ........ 

Ambata  and  Latacunea.  iiides  .  .  . 

744 


HISTORY   OF  PRICES   DURING  THE   WAR. 

FOREIGN  DRY  HIDES— Continued  . 


Description. 

Stocks  and 
shipments 
from  origin, 
to  and 
including 
July  31, 
1918. 

Remarks. 

Guayaquil  cities  (excepting  slaughterhouse),  hides  .  . 
Guatemala  city,  hides 

SO.  31J 
35  1 

New  York  delivery  and  selection. 

Guatemala  country,  hides  

.34J 

Do 

Honduras,  hides  

321 

Do 

Honduras'  Ampala  hides 

331 

Do 

San  Salvador,  hides  

.33i 

Do 

Nicaragua  hides  .  .                                          . 

32J 

Do 

Costa  Rica  hides 

32i 

Do 

Panama  hides  .  .  . 

32i 

Do 

Ecuador: 
Mount  Quito  hides  .                  

.33J 

Do 

Mountain  hides 

Do 

Coast,  hides  

.25J 

Do. 

Peru: 
Hides  

.32 

Do 

Kips  (flat  free  of  glue)  - 

38 

Do 

Hides  trimmed 

.34 

Do 

Hides  untrimmed  or  partly  trimmed 

55 

Do 

West  Indian  San  Domingo  Haiti  hides  . 

.29 

Do 

Porto  Rico  hides 

31 

Do 

Mexico: 
Northern- 
Hides 

.33 

New  York  freight    selection   as  cus- 

Kips. 

.39 

tomary. 
Do 

Calf  (free  of  glue) 

.45 

Flat   New  York  basi^ 

Pueblo,  San  Geronimo,  and  west  coast,  hides  .... 

.54i 

To 

Chihuahua  hides  .... 

.34 

New  York  freight    selection  as  cus- 

Java, shaved,  best  quality  and  selection: 
About  1  to  6  pounds  (about  2  kilos  average)  
About  6  to  10  pounds  (about  3t  kilos  average)  .  .  . 
About  10  to  15  pounds  (about  6  kilos  average)  .  .  . 
Rangoon,  arsenicated: 
Calf 

.75 
.68 
.62 

.40 

tomary. 

r.andf. 
Do. 
Do. 

Do. 

Calf  6  to  10  pounds  average 

.36 

Do 

Calf,  12  to  16  pounds  average. 

.32 

Do. 

Dry'  salted  16  to  20  pounds°average 

.26 

Do 

Cape  of  Good  Hope  and  South  Africa: 
Best  selection 

.34 

Do 

Best  selection,  dry  salted  

.32 

Do. 

Nigeria: 
Hides,  first  selection  

r 

.26 

Do. 

Kips,  excluding  glue 

.26 

Flat  c  and  f. 

Calf,  excluding  glue  .                               ^ 

.31 

Do. 

Madagascar: 
Best  selection  

.30 

C.  and  f. 

Dry  salted  .  . 

.20 

Do. 

Mombassa: 
Hides  and  kips.. 

.30 

Do. 

Calf. 

.35 

Do 

Abyssinian: 
Hides  and  kips.. 

.30 

Do. 

Calf 

.35 

Do 

Soudan: 
Hides  and  kips 

.28 

Do 

Calf  

.33 

Do. 

BUFFALOES. 

East  India,  winter  season: 
Commissariat,  slaughters  

13d 

Do. 

Dacca  slaughters  .  . 

8d 

Do 

Rangoon,  winter  season: 
First  selection,  dry.. 

$0.20 

Do. 

Dry  salted 

.16 

Do 

Trimmed  and  shaved  

.33 

Do. 

Java,  best  season: 
Trimmed  and  shaved  Y 

.36 

C.  i.  f.  and  war  risk  for  first  selection. 

China,  winter  season: 
Trimmed  and  shaved  .... 

.35 

Do. 

Arsenicated  . 

.21 

Do. 

Dry  salted  .  . 

.17 

Do 

China,  Hongkong: 
Shaved  

.31 

Do 

Dry 

.17 

Do 

Dry  salted  

.14 

Do. 

GOVERNMENT  REGULATIONS  RELATING  TO  PRICES. 
FOREIGN  DRY  HIDES-Continued. 


745 


Description. 

Shipment 
from 
origin, 
August, 
Septem- 
ber, and 
October. 

Remarks. 
\ 

BUFFALOES. 

West  Indies: 
Santo  Domingo  and  Haiti  — 
Dry  flint  hides                         

$0.29 

New  York  delivery  and  selection. 

Dry  salted  flat                                     

.25 

Do. 

Cordova,  W.  H.,  15  per  cent  desechos: 
Hides                                                

.37 

C.  and  f.,  New  York  or  Boston. 

Kips                            

.46 

Do. 

Description. 

Stocks  and  shipments  from  origin,  to  and  including  July 
31,  1918. 

Ito6 
pounds. 

6  to  10 
pounds. 

10  to  14 
pounds. 

14  to  20 
pounds. 

20  to  24 
pounds. 

24  to  30 
pounds. 

30  and 
up 
pounds. 

China: 
Hankow,  B.  S.  W.  H,  (2's  6  cents  less)  
Shanghai,  B.  S.  W.  H.  (2's  6  cents  less).  .  . 
Hongkong  original  run  flat 

$0.55 
.54 
.36 
.45 
.45 
.45 

SO.  48 
.47 
.33 
.37 
.37 
.37 

$0.48 
.47 
.33 
.37 
.37 
.37 

$0.46 
.45 
.32 
.35 
.35 
.35 

$0.  44 
.43 
.31 
.33 
.33 
.33 

$0.42 
.41 

SO.  40 
.39 

Thibet,  B.  S.  W.  H.  (2's  6  cents  less)  

.30 

.30 
.30 

.30 
.30 
.30 

Xeuchwang,  B.  S.  W.  H.  (2's  6  cents  less) 
Mongolia,  B  .  S.  W.  H.  (2's  6-cents  less)  .  .  . 

Above  prices  are  c.  i.  f.  and  war  risk. 


Shipment  from  origin,  August,  September,  October. 


1-6 
pounds. 

6-10 
pounds. 

10-14 
pounds. 

14-20 
pounds. 

20-24 
pounds. 

24-30 
pounds. 

30-up. 
pounds. 

China: 
Hankow,  B.  S.  W.  H.  (2's  6  cents  less>.  .  .  . 
Shanghai  B.  S.  W.  H.,  same  trim  as  Han- 
kow (2's  6  cents  less) 

$0.53 

.52 
.36 
.69 

.45 

$0.48 

.47 
.33 
.62 

.37 

$0.48 

.47 
.33 
.56 

.37 

$0.46 

.45 
.32 

$0.44 

.43 
.31 

$0.42 
.41 

$0.40 

Hongkong  original  run,  flat  

;::::;;: 

Canton  shaved 

Tibet,  Neuchwang,  Mongolia,  B.  S.  W.  H. 
(  2's  6  cents  less)... 

.35 

.33 

.30 

.30 

China  prices  are  c.  and  f.  New  fork. 

CABRETTA  AND  SHEEPSKINS. 


Stocks  on 

hand  May 

1,  1918, 

and  ship- 

Description. 

ments  from 

Remarks. 

origin,  to 

and  includ- 

Brazils 

$1.20 

Per  piece,  landed  basis  New  York. 

Punjabs: 
700  pounds  average  for  500  skins  

7.00 

Per  dozen. 

Eacn  100  pound  additional 

.50 

Per  dozen  more. 

China  sheepskins"  basis  2J  pounds  average 

15.00 

Per  dozen. 

Java  sheepskins,  basis  1£  pounds  average  

11.00 

Do. 

West  Indians  1  pound  to  1  J  pounds 

.65-1.00 

Flat,  per  piece. 

Peruvian  slats  f  pound  to  1  pound 

2.  50-4.  00 

Per  dozen,  according  to  quality  and 

weight. 

Cape  Town  glovers,  basis  first  heavies              

2.20 

Per  skin. 

(Lower  grades  and  weights  in  proportion.) 

746 


HISTORY  OF   PRICES   DURING  THE   WAR. 
CABRETTA  AND  SHEEPSKINS— Continue:!. 


Description. 

Stocks  on 
hand  May 
1,  1918, 
and  ship- 
ments from 
origin,  to 
and  includ- 
ing July 
31,  1918. 

Remarks. 

Spanish  lambskins: 
Basis,  first  wool,  12  to   13  kilos,  Catalonian 
primes  

$21  00 

Per  dozen 

(Other  weights  and  grades  in  proportion.) 
Oriental  lambs,  basis  95  to  100  kilos  

13.50 

Do 

Black-head  Mocha  sheepskins: 
Average  No.  1,  200  to  210  pounds  

2.00 

Per  skin 

Average  No.  1,  170  pounds 

1  70 

Do 

Average  No.  1,  140  pounds  

1.40 

Do. 

Average  No.  1,  125  pounds 

1  15 

Do 

Average  No.  1,  110  pounds  

1.00 

Do. 

Average  No.  1,  95  pounds 

85 

Do 

(All  seconds  at  two-thirds  price.) 
White  heads: 
Average  No.  1,  225  pounds 

1  60 

Do 

Average  No.  1,  179  to  180  pounds 

1  15 

Do 

Average  No.  1,  140  to  150  pounds 

90 

Do 

Average  No.  1  ,  120  to  125  pounds  .  . 

65 

Do. 

(All  seconds  at  one-half  price.) 

Mombassa  sheepskins;  No.  1,  150  to  160  pounds 
average. 
(Seconds  at  §  price.) 
Mombassa  shade  dried  

.80 
1  00 

Per  skin. 
Do 

(Seconds  at  §  price.) 
Red  Head  Mocha  sheepskins: 
Average  No.  1,  160  to  170  pounds  .     ... 

90 

Do 

Average  No.  1,  140  to  150  pounds 

70 

Do 

Average  No.  1,  115  to  120  pounds  

.40 

Do. 

(Seconds  at  J  price.) 

Description. 

Shipments 
from  point 
of  origin, 
August, 
September 
and 
October. 

Remarks. 

Brazil,  banded,  bans,  over  2  pounds,  heavies,  regu- 
lar primes. 
Punjab: 
Sheep  pelts,  400  pounds  average  for  500  skins  
Wool  sneep,  1,500  pounds  average  for  500  skins... 
Madras  and  southern  India  sheep: 
Basis,  85  per  cent  primes;  15  per  cent  seconds, 
average  about  185  to  200  pounds. 
West  Indies  sheepskins;  basis  J  tol$  pounds  average. 
Spanish  lambskins,  first  wool,  second  wool,  13  to  14 
kilos: 
Basis,  Catalonian  primes  

SI.  30 

7.00 
13.50 

11.00 
$0.65-1.00 

21.00 

Each. 

Per  dozen. 
Do. 

Do. 
Each. 

Per  dozen. 

18  to  19  kilos  .  .  . 

23  00 

Do 

13  to  14  kilos 

21  00 

Do 

8  to  9  kilos  

19  00 

Do. 

Macedonian  lambskins: 
Average  about— 
95  to  100  kilos  

13.00 

Do. 

80  to  90  kilos  . 

12.25 

Do. 

70  to  80  kilos  

11.75 

Do. 

60  to  70  kilos  

11  00 

Do. 

50  to  60  kilos 

q  00 

Do 

Grecian  lambskins: 
Average  about  — 
95  to  100  kilos  

14.00 

Do. 

80  to  90  kilos 

13  25 

Do 

70  to  80  kilos  

12.75 

Do. 

60  to  70  kilos 

12  00 

Do 

50  to  60  kilos  

JO  00 

Do. 

Prime   Macedonian  and   Grecian  sheeo^lrrs  ar<* 
Kavlaks,  average  over  140  kilos. 

18.00 

Do. 

GOVERNMENT  REGULATIONS   RELATING  TO  PRICES. 


747 


GOATSKINS. 

The  prices  on  goatskins,  as  given  in  the  following  schedule  of  May  1,  1918,  were  con- 
tinued in  force  through  December,  1918,  without  change  : 

Angoras,  straight  -------------------------------------------------  $0.  42J 

Angoras,   light  crossbred  --------------------  -  -----------------------  .50 

New  Mexico,  No.  1  ________________________________________________  .75 

Navaho,  No.   1  ______________________________________  -  -------------  .85 

-  (No.  2's,  kids  and  bulls,  two-thirds  price.) 
Domestic  skins  ___________________________________________________  v  12.  00-15.  00 

1  18.  00 


a  1.  65 
2  2.  00 
2  2.  25 
a  1.  75 

a.  85 
*.65 
a.  65 
1.00 

.  55 
.  50 
.45 
.  43 


•  1.  30 
*  .  05 


Packers 
Mexico  : 

Oaxacas,  flat   ($0.90  per  pound) 
Pueblas,  flat  ($0.85  per  pound) 
Matanzas,  flat   ($0.80  per  pound) 
Frontiers,  selected   ($0.75  per  pound) 
West  Indies  : 

Jamaicas,    flat 

Porto  Plata,  flat  _______________  - 

Haitians,  flat 
Colombia,  Bogoto,  selected 
Venezuela  : 

Barquisemetas,  flat 
Coros,  flat 
Rio  Hache,   flat 
Islands,   flat 
Maracaibos,  flat 
La  Guayras,  flat 
Brazil  : 

Brazils 

For  110  average  New  York,  with  specials 
Heavies,  20  per  cent  less  than  firsts. 
Bulls,  light  and  seconds,  two-thirds  price  of  firsts. 
Bahias,  on  basis  of  2|  cents  less  per  pound. 
Argentines  : 

Cordobas    (50  per  cent  Matedores  and  50  per  cent   Campos),  91   to 

10  K.,  $0.85  for  firsts  ;  seconds,  two-thirds  price. 
Santiago,  same  price  as  Cordobas. 
Metans  .  9£  to  10  K,  10  cents  less  ...............................................................  75 

San  Luis  .  10  K,  lOcentsless  ....................................................................  75 

Saltas,  10  K  ...........................  .  ........................................................  70 

Bahia  Blancas  ,  11  to  12  K  ......................................................................  60 

Pampas(  Buenos  Aires  Provinces)  ,  11  to  12  K  ..................................................  62J 

Cordobas  kidskin  ..................................................................  per  dozen.  .    3.  50 

Seconds.  two-third  price. 
Chilians: 

Chile  kidskins  ..........................................................................  do  ... 

Seconds,  two-thirds  price. 
Peru: 

Paytas,  dry  salted,  selected  basis  .................................................  per  pound. 

Peruvian  goats  (flint  dry)  flat  basis  ....................................................  do 

Piscos,dry  salted,  selected  basis  ...................  .,  ....................................  do 

Bolivia: 

Bolivians  ,  flat  basis  .....................................................................  do 

Africa: 

North  Africans,  no  importations. 

Egypt,  no  importations  . 

Capetown,  basis  prime  extra  lights  ................................  ..  ...................  do 

Algoah  Bay,  basis  prime  extralights  ...................................................  do 

Kafir,  basis  prime  extra  lights  ..................  ........................................  do 

Nigerian  ..........................................................................  per  dozen. 

All  primes  free  kid  s  . 

Weight,  pounds,  $1.30  per  skin,  lower  qualities  proportionately  cheaper. 


3.  50 


.  65 
55 
55 

45 


70 

65 

55 

14.  00 


Firsts. 

Seconds. 

Thirds. 

Average 
pounds. 

Per 
dozen. 

Abyssinians  flint  dry  flat        .                 

Per  cent. 
60 

Per  cent. 
30 

Per  cent. 
10 

110 

$12.00 

60 

30 

10 

110 

12.50 

Dunkali'  flat                                            

10 

75 

15 

90 

9.00 

Berherah  flat                                                     

50 

40 

10 

110 

13.00 

Somali  flat 

10 

75 

15 

95 

9.00 

Hodeidahs  flat                                        

60 

30 

10 

120 

11.00 

Gizan  and  Gumfittah  flat                                  

60 

30 

10 

120 

11.00 

60 

30 

10 

115 

10.50 

A  dan  butchers  flat                                   

(5) 

(5) 

10 

170 

18.00 

25 

60 

»          15 

110 

12.50 

1  Per  dozen,  flat.         2  Average  per  pound.         8  Per  pound. 


Less. 


B  All  firsts. 


748 


HISTORY   OF  PRICES  DURING  THE   WAR. 


Spain  : 

Goatos    and    cheverettes dozen__  $30.  00 

Greece : 

Macedonian  goats,  selected  basis do 17.  50 

Macedonian  cheverettes,  selected  basis do 14  00 

India : 

Amritzar,  basis  1,000  pounds  for  500  skins  ;  85  per  cent  firsts,  15  per  cent 

seconds    dozen 13.  00 

For  each  extra  100  pounds,  per  500  skins  additional do__  1.  00 

Wet  salted  Northwest : 

40  inches  and  upward piece__       1  38 

36  to  40  inches __do__  1.  33 

33  to  36  inches __do_  1  23 

28  to  33  inches do 1.  13 

Seconds,  70  per  cent  of  price  of  firsts. 
Dry  salted  : 

Patnas,  about  550  average  for  500  skins dozen 11.  00 

Mpzufferpores,  about  550  average  for  500  skins do 12.  00 

Dinajpores,  about  550  average  for  500  skins do 11.  75 

Daccas.  about  550  average  for  500  skins do 13.  00 

The  above  dry  salted  are  all  about  50  per  cent  primes,  30  per  cent  seconds, 
20  per  cent  thirds. 

Calcutta,  killed,  about  675  pounds  average dozen 15.  50 

Kushitas,  about  675  pounds  average  for  500  skins do 17.  00 

Dry  salted  Calcutta  and   Kushitas  are  about  75  per  cent  primes,   15  per 

cent  seconds,  10  per  cent  thirds. 
Northwests,   about  900  pounds  average  for   500   skins,   60  per  cent  primes, 

30  per  cent  seconds,  10  per  cent  thirds dozen 15.00 

Madras,  185  pounds  average,  flat do 14.  50 

Coconada,  190  pounds  average,  flat do 15.  00 

Javas : 

Javas,  82  pounds  basis  primes do 15.  00 

China  : 

Chowchings,    short   hair,    19   pounds   per  dozen,    average,    inclusive,    30   per 

cent    seconds    dozen 19.00 

Chowchings,  medium  hair,  22  pounds  per  dozen,  average,  inclusive,   30  per 

cent  seconds   dezen 16.  50 

Chowchings,  long  hair,  27  pounds  per  dozen,  average,  inclusive,  30  per  cent 

seconds    dozen 16.  00 

Shuntifus,  $1  per  dozen  less  than  Chowchings. 

Patoingfu,  $2  per  dozen  less  than  Chowchings. 

Tientsins,$3  per  dozen  less  than  Chowchings. 

Short  hair  descriptions  may  include  15  to  20  per  cent  medium  hair. 


Seconds. 


Per 
dozen. 


Szechuens,  17  pounds  average,  inclusive 

Wanshiens,  19  pounds  average,  inclusive 

Honans,  18  pounds  average,  inclusive 

Clear  River,  18  pounds  average,  inclusive 

Mud  cured  rivers,  21  pounds  average,  inclusive. 


Per  cent. 
25 
25 
25 
25 
30 


S27.  50 
21.00 
14.50 
12.00 
8.00 


DEER  AND  ELK  SKINS. 

The  original  schedule  for  deer  and  elk  skins,  effective  May  1,  1918,  was  maintained 
through  December,  1918,  with  a  single  exception,  noted  below : 


Flat. 

Guatemales $0.  75 

San  Salvador .  75 

Honduras,  trimmed .  70 

Honduras,  untrimmed .  65 

Costa  Ricas .  70 

Central  Americans .  70 

Angosturas .  38 

La  Guayras .  35 

Maracaibo .  29 

Rio  Hache .31 

Sisals .  65 

Mexicans .  55 


Flat. 

Tuxpans $0.  60 

Matamoras .  50 

Paras .  55 

Maranhams < .  70 

Oaxacas ; .  85 

Panamas .  65 

Barquismetos .  35 

Porto  Cabellos .  35 

West  Coast .  70 

Chinas,  not  over  15  per  cent  seconds-        .  95 
Singapore   elks .  45 


Macassar  elks 


.42 


When  sold  on  a  selected  basis,  the  maximum  prices  shall  be  10  per  cent  above  the 
maximum  prices  set  above. 

Domestic  deerskins  from  $1  to  $3.50  per  piece,  according  to  size,  section,  and  quality. 

Take-off  for  August,  September,  and  October  on  Chinas,  1  to  11  pounds,  not  over  15 
per  cent ;  seconds,  $1.05. 

APPENDIX. 

SUPPLEMENTARY    PRICES    AND    REGULATIONS    ON    HIDES    AND    SKINS    ISSUED    ON     JULY    1,    1918. 

The   maximum   price   on    standard    packer    kid    skins,    measuring    pbout   two-thirds    the 
size  of  the  goatskins  is  two-thirds  the  price  of  the  goatskins. 

The  maximum  price  on  butcher  and  country  kid  skins  is  $4  per  dozen. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  749 

The  maximum  price  on  Sumatra  buffalo  hides  is-  33  cents  for  trimmed  and  shaved, 
31  cents  on  untrimmed  and  shaved. 

The  maximum  price  in  Tapuchula,  Mexico,  wet  salt  hides  is  22J  cents. 
The  maximum  prices  on  Sumatra  cowhides,  shaved,  are  as  follows  : 

Skippers  own 
preparation. 
Country  and  untrimmed  : 

About  1  to  6  pounds  about  2  kilos  average,  65  cents  c.  and  f , cents 70 

About  6  to  10  pounds  about  3|  kilos  average,  58  cents  c.  and  f do 63 

About  10  to  15  pounds  about  6  kilos  average,  52  cents  c.  and  f do 57 

The  maximum  price  on  Cuban  wet  salt  hides  is  19  cents. 

The  maximum  price  of  Tuxpan,  Mexico,  wet  salt  hides  is  21 J  cents. 

The  maximum  price  on  Canton,  China,  shaved  dry  hides  is  as  follows  : 

One  to  6  pounds,  69  cents ;  6  to  10  pounds,  62  cents ;  10  to  15  pourds,  56  cents ; 
c.  i.  f.  and  war  risk  New  York  basis. 

The  maximum  price  on  China  dry  donkey  hides  is  $2  each  c.  i.  f.  and  war  risk,  New 
York  basis. 

The  maximum  price  on  Mendez,  Brazil,  frigoriflco  hides  is  20  cents  weighed  ex  dock 
New  York.  Delaware  and  New  Jersey  are  classed  with  the  New  England  States. 

The  maximum  price  on  Madras  pickled  goatskins  is  $15.50  per  dozen. 

The  maximum  price  on  Madras  extra  large  goatskins  about  27  pounds  average  is  $16.50. 

The  maximum  price  on  Argentine  wet  salt  Matadero  and  Campo  kip  is  20  cents. 

The  maximum  price  on  Courland  Scharren  dry  calf  is  $1.20  per  pound ;  Courland 
slaughter  dry  calf  is  $1.10  per  pound  ;  Wiatka  dry  calf  is  $1.07  per  pound  ;  Palloy  dry 
calf  is  45  cents  per  pound. 

The  maximum  price  on  Mexican  wet  salt  kips  is  the  same  price  as  the  maximum  on 
the  same  kind  of  hides. 

The  maximum  price  on  Tampico,  Mexico,  dry  hides  is  321  cents. 

The  maximum  price  on  Madras  sheepskins,  basis  85  per  cent  primes  and  15  per  cent 
seconds,  average  about  190  to  200  pounds,  is  $11. 

The  maximum  prices  on  Hulo  (Hawaiian  Islands)  packer  steers,  27  cents;  cows,  22 
cents,  ex  store  San  Francisco. 

The  maximum  price  on  ducca  cowhides  9  to  12  pounds  and  12  to  15  pounds  is  26 
cents  c.  f.  s. 

The  maximum  price  on  China  wet  salt  buffaloes  is  13  cents. 

The  maximum  price  on  Habana  packer  hides  of  superior  take-off  and  preparation  Is 
1  cent  per  pound  more  than  other  Habana  packer  hides. 

The  price  on  Chicago  and  other  large  city  first-salt  calfskins  applies  to  all  other  first- 
salt  untrimmed  skins  in  carload  lots,  equal  in  all  respects  to  Chicago  skins.  Other 
first-salt  skins  of  inferior  quality,  take-off,  and  preparation  shall  sell  at  relatively  less. 

Any  resalted  packer,  abattoir,  or  wholesale  butcher  calfskins  shall  sell  at  relatively  less 
than  the  price  of  44  cents,  which  is  for  first-salt  standard  packer  stock  on  Chicago  freight 
basis. 

The  maximum  price  on  River  Tlata  frigorifico-type  kips  and  extremes  is  26  cents  and 
freight,  shrinkage  guaranteed  not  to  exceed  10  per  cent,  to  Now  York  or  Boston. 

A  go-between  can  not  charge  a  brokerage  to  both  buyer  and  seller.  No  one  owing 
a  lot  of  hides  or  skins  can  charge  his  customer  a  brokerage  when  selling  same.  Any 
tanner  may  pay  an  agent  a  brokerage  for  buying  hides  or  skins  (except  on  hides  or 
skins  which  the  agent  owns  himself),  but  such  agent  may  not  buy  less  than  carload 
lots  of  butchers  at  a  higher  price  than  10  per  cent  under  applicable  maximum  prices. 
No  brokerage  shall  exceed  2  per  cent. 

Small  packer,  abattoir,  and  wholesale  butcher  price  light  calf  (7  to  8  pounds)  and 
deacons  are  governed  by  the  packer  calf  price  of  44  cents  for  first-salt  stock,  on  Chi- 
cago freight  basis,  and  taking  into  consideration  any  inferiority  as  to  take-off  and 
salting. 

BLACK  HARNESS  LEATHER. 

Harness  leather. — The  prices  of  black  harness  leather  were  fixed  by  the  price- 
fixing  committee  on  June  25,  1918,  subject  to  revision  November  1,  1918,  or 
before  that  date,  contingent  upon  possible  changes  in  the  prices  of  hides  and 
skins.  The  prices  in  the  schedule  below  were  later  extended  until  November 
20,  1918,  when  price  fixing  was  here  ended. 

BLACK  HARNESS  LEATHERS. 

(June  25,  1918.) 

Per  pound. 

Grade  A,  or  first  selection $0.  70 

Grade  B,  or  second  selection 

Grade  C,  or  third  selection •  6( 

First  selection,  butt  brands 

Second  selection,  butt  brands •  66 


750  HISTORY  OF  PEICES  DURING  THE  WAR. 

SOLE  AND  BELTING  LEATHER. 

(Aug.  9,  1918.) 

Provisions  for  the  control  of  prices  and  output  of  sole  and  belting  leather 
became  effective  August  9,  1918,  and  were  administered  by  the  hide  and  leather 
section  of  the  War  Industries  Board.  These  regulations  and  prices,  which  are 
given  below,  were  extended  on  October  8,  1918,  until  December  8,  1918,  when 
they  were  removed. 

REGULATIONS. 

These  maximum  prices  on  grades  are  based  on  maximum  prices  of  No.  2 
selection  as  basis  for  tannery  run.  When  sold  in  selections  the  assortment 
value  of  the  total  selections  shall  not  exceed  the  maximum  price  of  the  No.  2 
or  tannery  run. 

In  Texas  scoured  or  bloom  oak  sole  leather,  classification  No.  3,  the  tannery 
run  maximum  price  is  87  cents,  and  when  sold  in  selections  the  assortment 
value  of  the  four  selections  shall  not  exceed  the  maximum  tannery-run  price 
of  87  cents. 

These  prices  apply  to  all  sales  made  by  tanners  or  by  their  representatives 
or  by  jobbers,  but  do  not  apply  to  sales  made  by  retail  dealers  or  by  the  so- 
called  findings  trade. 

DIFFERENTIALS.  , 

Tanners  who  claim  preferential  differentials  on  account  of  low  yield  of 
leather  will  make  application  for  same  to  the  hide,  leather,  and  leather  goods 
division  of  the  War  Industries  Board. 

The  conditions  upon  which  they  will  be  given  this  advantage  are: 

That  their  yield  shall  be  at  least  seven  points  under  the  yield  used  as  a 
factor  in  determining  maximum  prices  on  the  same  season's  hides  and  that  a 
sworn  statement  shall  be  rendered  to  this  effect  and  shall  be  the  result  of  at 
least  six  months'  operation. 

That  they  will  make  consecutive  monthly  reports  to  the  hide,  leather,  and 
leather  goods  division  of  the  War  Industries  Board  of  their  yield. 

Every  side  of  subdivision  of  these  sides  shall  be  stamped  with  the  name  of 
the  tannage. 

Tanneries  producing  leather  of  such  high  yield  as  to  exceed  the  arbitrary 
factor  of  yield  used  in  figuring  maximum  prices  on  the  same  season's  hides  by 
more  than  seven  points  shall  be  subject  to  a  differential  reduction,  such  reduc- 
tion to  be  figured  on  the  excess  yield  beyond  or  above  the  seven-point  allow- 
ance. Every  side  or  subdivision  of  these  sides  shall  be  stamped  with  the  name 
of  the  tannage. 

When  requested  by  the  hide,  leather,  and  leather  goods  division  of  the  War 
Industries  Board  tanners  will  make  monthly  reports  of  their  yields,  stating 
classes  and  seasons  of  hides. 

PRICE  OF  OFFAL. 

These  maximum  prices  are  established  for  three  months  and  at  a  time  when 
all  offal  is  a  burden  on  the  market.  At  the  expiration  of  the  three  months,  if 
the  offal  has  found  an  outlet  and  established  a  higher  market  level,  this  addi- 
tional return  in  value  to  tanners  will  be  reflected  in  the  readjustment  of  a  new 
schedule  three  months  hence. 

High-grade  heavy  packer  oak  belting  butts,  made  from  packer  heavy  native  and  er  , 
light  native  steers  and  heavy  native  cows  (based  on  yield  of  65  per  cent)  : 

No.  1 $0.  96 

No.  2 .  94 

No.  3 .  86 

High-grade  light  packer  oak  belting  butts  under  20  pounds,  made  from  light  native 
cows  and  extreme  light  native  steers  (based  on  yield  of  62  per  cent)  : 

No.  1 .  91 

No.  2 .  89 

No.  3__                                                                     .81 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  751 

High-grade  Texas  scoured  or  bloom  oak  sole  leather,  made  from  packej  heavy  and 

fight  Texas  steers  (based  on  yield  of  83  per  cent)  : 

Tan    run    sides $0.  571 

Tan  run  bends •  §7 

X  sides .  59Jj 

A    sides •  58J 

B    sides •  57J 

C    sides •  56i 

X   bends .  90 

A  bends .  °e 

B   bends •  °» 

C   bends •  84 

High-grade  heavy  or  overweight  oak  sole  leather,  made  from  packer  butt  brands 

and  Colorado  steers,  oak  trim  (based  on  yield  of  78  per  cent)  : 

No   1   sides .61 

No.  2  sides .59 

No.  3  sides •  55 

No.   1   backs .77 

No.   2   backs .75 

No.   3   backs .71 

No.   1   bends „ •  9C 

No.   2  bends •  88 

No.   3  bends •  84 

High  grade  heavy  or  overweight  union  sole  leather  made  from  packer  butt  brand 

and  Colorado  steers  and  frigorifico  steers,  union  trim  (based  on  yield  of  80  per 

cent)  : 

No.  1  sides 0.59 

No.  2  sides .57 

No.  3  sides .53 

No.  1  backs .75 

No.  2  backs .73 

No.  3  backs .69 

No.   1   bends'. .88 

No.   2   bends .86 

No.   3  bends .82 

High   grade   light   or   middleweight  oak  sole  leather   made   from   packer   branded 

cows,  oak  trim  (based  on  yield  of  75  per  cent)  : 

No.  1  sides .56 

No.  2  sides .54 

No.  C  sides .503 

No.  1  backs .72" 

No.  2  backs .70 

No.  3  backs .66 

High  grade  light  or  middleweight  oak  sole  leather,  union  trim  based  on  yield  of 

75  per  cent)  : 

No.  1  sides -•»  56| 

No.  2  sides .  54J 

No.  3  sides .  50J 

No.    1    backs .71 

No.   2   backs .69 

No.    3   backs .65 

Country  or  domestic  hides,  heavy  or  overweight  oak  or  union  leather,  made  from 

steers  or  heavy  cows  (based  on  yield  of  68  per  cent)  : 

No.   1   sides .53 

No.  2  sides -— ^ .51 

No.  3  sides .47 

Country  or  domestic  middleweight  oak  or  union  leather  made   fn:m   cows   or  ex- 
treme light  steers  (based  on  yield  of  68  per  cent)  : 

No.  1  sides .50 

No.  2  sides .48 

No.  3  sides .44 

High  grade  heavy  or  overweight  hemlock  leather  made  from  packer  heavy  (based 

on  yield  of  90^per  cent)  : 

No.  1  sides .  56 

No.  2  sides .54 

No.  3  sides .50 

High   grade   middleweight  hemlock   sole   leather   made   from   extreme   Texas   and 

branded  cows  (based  on  yield  of  80  per  cent)  : 

No.  1  sides .54 

No.  2  sides .52 

No.  3  sides .48 

Country   or  domestic  hide,  heavy   or  overweight   hemlock,   made   from   steers   or 

heavy  cows   (based  on  yield  of  80  per  cent)  : 

No.  1  sides .48 

No.  2  sides -47 

No.  3  sides .43 

Country  or  domestic  hemlock  made  from  cows  or  extreme  light  steers   (based  on 

yield  of  80  per  cent)  : 

No.  1  sides .47 

No.  2  sides .45 

No.  3  sides .42 

High   grade   dry   hide  heavy   overweight   and   middleweight   hemlock    made   from 

Buenos  Aires  hides  (based  on  yield  of  170  per  cent)  : 

Tan-run    sides  __ •  43 

Buffalo  dry  hide  overweight  (based  on  yield  of  190  per  cent)  : 

Ton-run    sides .  34 


7.  LUMBER. 


The  first  step  in  the  control  of  lumber  prices  was  taken  in  1917  with  the  in- 
stitution by  the  lumber  committee  of  the  Council  of  National  Defense,  of 
**  emergency  bureaus,"  semiofficial  Government  agents  in  the  purchase  of  Gov- 
ernment lumber  requirements.1 

The  general  regulations  concerning  lumber  prices  and  the  regulations  and 
schedules  pertaining  to  individual  species  appear  below  in  the  following  order : 

General  regulations,  birch  logs,  black  walnut,  cypress  and  tupelo,  Douglas  fir, 
mahogany  lumber,  New  England  spruce,  North  Carolina  pine,  Pennsylvania  hem- 
lock, southern  or  yellow  pine,  western  spruce. 

GENERAL  REGULATIONS. 

Notice  as  to  Government  lumber  prices,  March  30,  1918. — All  lumber  manu- 
facturers and  dealers  are  hereby  notified  that  the  present  Government  yellow 
or  southern  pine  lumber  prices  for  mill  shipments  from  the  Southern  States  are 
to  remain  in  effect  until  June  15,  1918,  and  that  in  no  case  must  orders  for  lum- 
ber for  mill  shipments  be  accepted,  sold,  or  invoiced  to  the  Government  or  Gov- 
ernment contractor,  having  a  cost-plus  job,  either  by  manufacturers  or  dealers, 
at  any  greater  price  per  item  than  the  maximum'  price  fixed  by  the  Government 
list.2 

Public  announcement  regarding  lumber  made  by  the  price-fixing  committee 
of  the  War  Industries  Board,  June  11,  1918. — The  price-fixing  committee  of  the 
War  Industries  Board  has  fixed  maximum  item  prices  for  northwestern  fir  logs 
and  lumber  and  for  southern  pine  lumber.  The  detailed  schedules  of  these  item 
prices  have  been  approved  by  the  President  and  publicly  announced.  The  prices 
established  are  manufacturers'  f.  o.  b.  mill  prices  for  shipment  at  the  mills,  the 
same  for  all  purchasers.  They  are  maxim-urn  prices,  not  fixed  prices,  to  hold  for 
a  period  of  90  days  from  June  15. 

No  regulation  has  been  made  with  regard  to  transactions  other  than  sales  by 
manufacturers  at  the  schedule  prices.  Wholesale  dealers,  retail  dealers,  and  all 
others  are  entitled  to  buy  on  the  basis  of  these  f.  o.  b.  mill  prices.  As  yet  no 
regulation  of  rates  or  profits  has  been  made  with  regard  to  sales  either  by 
wholesalers  or  retailers  to  consumers.  The  War  Industries  Board  believes  that 
sales  by  all  dealers  should  be  made  at  reasonable  prices  based  on  a  strictly  rea- 
sonable profit  above  the  fixed  schedule  rates.  The  board  is  confident  that  the 
trade  will  conform  to  the  spirit  of  the  existing  regulations  and  the  board  will 

1  These  bureaus  and  dates  of  organization  were  as  follows  :   Southern   pine   emergency 
bureau,  May,  1917  ;  North  Carolina  pine  emergency  bureau,  May,  1917 ;  Georgia-Florida 
yellow  pine  emergency  bureau,  June,  1917  ;  New  England  spruce  emergency  bureau,  June, 
1917  ;  Douglas  fir  emergency  bureau  (later  organized  as  the  fir  production  board),  October, 
1917  ;  Northern  hardwood  emergency  bureau,  Nov.  24,  1917  ;  Central  Pennsylvania  hem- 
lock emergency  bureau,  Apr.  6,  1918  ;  Cypress  emergency  bureau. 

2  Price-Fixing  Committee  Minute  Book  II,  Mar.  30,  1918. 

752 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  753 

not  proceed  to  further  regulation  or  restriction  of  dealers'  prices  until  their 
conduct  of  business  indicates  that  such  action  is  necessary. 

Retail  lumber  prices. — Occasional  purchases  of  lumber  from  retail  lumber 
dealers  to  meet  emergency  needs  became  necessary  for  certain  branches  of  the 
Government,  and  in  order  to  insure  a  fair  and  reasonable  price  a  fixed  maxi- 
mum retail  price  was  established  for  Douglas  fir  and"  southern  yellow  pine 
lumber  for  the  period  from  June  1,  1918,  to  July  31,  1918.  These  prices  applied 
to  emergency  purchases  of  lumber  from  retail  lumber  dealers  in  the  cities  and 
vicinities  of  Boston,  New  York,  Newark,  N.  J.,  Philadelphia,  and  Baltimore. 

The  agreement  was — 

That  the  dealers  be  allowed  for  handling  charges  and  profit  the  following 
.advance  prices  over  and  above  the  Government's  delivered  prices  f.  o.  b.  cars  in 
the  districts  mentioned,  including  switching  charges,  if  any :  To  the  dealers  in 
the  cities  and  vicinities  of  Boston,  New  York  City,  Newark,  N.  J.,  $12.50  per 
1,000  feet  b.  m. ;  to  the  dealers  in  the  cities  and  vicinities  of  Philadelphia  and 
Baltimore,  $11.50  per  1,000  feet  b.  m. 

These  prices  in  all  districts  to  be  based  on  the  Government  department  re- 
placing the  lumber  to  the  dealers  within  90  days  from  date  of  replacement 
order  at  the  Government's  manufacturers'  prices  delivered  f.  o.  b.  cars  in  the 
districts  mentioned,  provided  the  dealers  prefer  to  have  the  lumber  replaced, 
or  a  cash  settlement  on  the  same  basis  if  they  prefer  not  to  have  the  lumber 
replaced.  These  prices  to  the  Government  for  the  lumber  received  from  the 
retail  dealers  in  all  cases  to  be  f.  o.  b.  dealers'  wagons,  trucks,  or  railroad  cars 
in  dealers'  yards. 

Working. — Where  dressing  or  ripping  is  necessary  to  obtain  the  items  de- 
sired by  the  Government,  charges  for  same  shall  not  exceed  the  following: 
Dressing  one,  two,  or  four  sides,  $4  per  1,000  feet  b.  m. ;  ripping  or  resawing 
(first  cut),  $4  per  1,000  feet  b.  m. ;  ripping  or  resawing  (second  cut),  $2  per 
1.000  feet  b.  m. 

Teaming. — When  lumber  is  hauled  by  retail  yards  the  charges  for  same 
shall  not  exceed  the  charges  following:  By  auto  truck,  $2.50  per  1,000  feet  first 
mile,  with  allowance  of  35  cents  per  1,000  each  additional  mile ;  by  team,  $1.75 
per  1,000  feet  first  mile,  with  allowance  of  25  cents  per  1,000  each  additional 
mile. 

In  the  event  the  Government  does  not  replace  the  lumber  taken  from  local 
yards  within  the  time  stated  above  it  is  understood  that  the  retailer  may  refuse 
to  accept  lumber  replacement,  and  settlement  for  lumber  taken  should  be  made 
on  basis  of  the  following  allowances  in  addition  to  the  original  replacement 
price :  $6  per  1,000  feet  on  all  short  leaf ;  $6  per  1,000  feet  on  all  long  leaf  under 
12  inches ;  $10  per  1,000  feet  on  all  long  leaf  12  inches  and  over. 

In  the  matter  of  replacing  lumber  taken  from  retail  yards  under  the  above 
agreement  it  is  understood  that  the  lumber  is  to  be  replaced  in  the  same  sizes 
or  easier  sizes  than  the  sizes  taken  from  the  retail  dealers;  that  is  to  say,  if 
boards  are  taken  from  the  retail  dealers,  boards  are  to  be  replaced ;  or  if  fram- 
ing lumber  is  taken,  framing  lumber  is  to  be  replaced  in  sizes  no  larger  than 
the  sizes  taken. 

For  the  present,  at  least,  it  is  understood  that  all  lumber  replacements  will 
come  from  the  districts  of  Alabama-Mississippi  territory,  southern  pine  terri- 
tory, Georgia-Florida  territory,  and  from  the  first  district  in  the  Pacific  North- 
west. If  North  Carolina  pine  is  taken  from  the  retail  dealers'  yards,  it  may 
or  can  be  replaced  by  comparable  grade  from  the  shortleaf  territory  of  the 
above-mentioned  producing  districts. 

All  requests  for  replacement  by  the  retail  dealers  should  be  accompanied 
by  the  signature  of  the  receiving  Government  officer  or  agent,  that  the  director 
of  lumber  may  know  in  replacing  this  lumber  that  the  sizes  and  quantities 
asked  for  are  justified,  and  should  be  submitted  to  the  Government  bureau  in 
Washington  through  which  the  original  authority  for  the  original  purchase 
by  the  Government  was  authorized. 

It  must  be  distinctly  understood  that  the  above  prices:  referred  to  are  only 
effective  in  the  cities  and  vicinities  above  mentioned,  where  the  costs  of 
handling  and  doing  business  have  been  investigated  by  the  Federal  Trade 
Commission. 

125547°— 20 48 


754  HISTORY   OF   PRICES   DURING  THE   WAR. 

All  departments  of  the  Army  and  Navy  and  the  Emergency  Fleet  Corpora- 
tion agree  immediately  to  put  maximum  prices  into  effect,  and  all  purchasing 
officers  of  all  departments  are  to  be  notified  immediately  of  the  above  decision.1 

Notice  as  to  application  of  prices  for  soft  wood  lumber  affected  by  rulings 
of  the  price-fixing  committee  of  the  War  Industries  Board. — All  lumber  manu- 
facturers and  dealers  are  hereby  notified  that  the  present  prices  for  soft 
lumber  for  mill  shipment  as  heretofore  established  or  which  may  hereafter  be 
established  by  the  price-fixing  committee  of  the  War  Industries  Board  shall 
remain  in  effect  during  the  period  of  time  prescribed  and  that  in  no  case  must 
orders  for  lumber  for  mill  shipment  or  reconsignment  thereof  be  accepted, 
sold,  or  invoiced  to  any  purchaser  by  either  a  manufacturer,  dealer,  or  other 
person  at  a  greater  price  per  item  than  the  maximum  price  fixed  by  the 
price-fixing  committee  of  the  War  Industries  Board,  except  where  delivered 
prices  are  made  to  purchasers'  destination  points,  in  which  cases  freight  may 
be  added  on  the  basis  of  standard  weights  for  each  item  so  priced,  also  except 
as  to  orders  received  or  contracts  made  prior  to  the  date  of  ruling  of  the  price- 
fixing  committee  governing  the  producing  territory  involved. 

The  price-fixing  committee  has  taken  the  position  that  cost  figures  presented 
by  the  Federal  Trade  Commission  on  which  the  price-fixing  committee  .has 
based  its  ruling  already  include  sales  service  to  purchaser.  So,  in  fact,  in 
paying  the  price  fixed  in  the  ruling,  the  purchaser  has  already  paid  for  this 
sales  service.  The  purchaser  or  public  should  not  be  asked  to  pay  any  addi- 
tional price  to  any  vendor  offering  mill  shipments.2 

The  wholesale  lumber  dealers  of  the  country  protested  against  this  ruling, 
saying  that  the  prices  as  fixed  did  not  allow  any  compensation  or  profit  to 
them  in  the  sale  and  distribution  of  lumber  and  that  the  strict  application  of 
the  ruling  would  destroy  a  selling  and  distributing  agency  which  had  long  been 
a  recognised  factor  in  the  lumber  trade.  On  July  23  the  price-fixing  com- 
mittee, after  consideration  of  arguments  submitted  by  the  wholesale  lumber 
dealers,  refused  to  modify  its  ruling  of  July.3 

Statement  on  southern  pine  prices  on  Government  orders. — Settlement  of 
Question  of  price  with  southern  pine  emerycnci/  Intrenu  as  to  orders  on  hand 
prior  to  midniffht,  June  Jj,  1918. — On  all  Government  orders  on  which  the 
price  is  fixed  by  the  Government  the  price  in  effect  on  the  date  of  shipment 
rather  than  the  price  in  effect  on  the  date  the  order  is  placed  shall  control, 
unless  expressly  stipulated  to  the  contrary  at  the  time  the  price  is  fixed,  or 
unless  a  different  rule  is  adopted  by  mutual  agreement  between  the  Government 
and  the  manufacturer. 

CONDITION   TO   THE   RULE. 

As  a  condition  to  this  rule,  it  must  be  understood,  however,  that  the  shipper 
will  exercise  due  diligence  in  an  effort  to  prepare  and  move  the  items  covered 
by  such  order,  and  that  tho  southern  pine  emergency  bureau  will  exercise  its 
best  efforts  in  inducing  the  members  with  whom  orders  are  placed  to  send 
shipments  forward  as  promptly  as  possible;  provided  that  if  it  is  established 
that  due  diligence  has  not  been  used  by  any  mill,  the  price  shall  be  the  lower 
price  applying  in  the  price-fixing  periods  involved. 

ORDERS   UNSHIPPED. 

All  orders  for  the  Government  unshipped  on  June  14,  1918,  shall  take  the 
price  prevailing  at  the  time  such  orders  were  placed  with  the  bureau ;  provided 
that  this  rule  shall  not  be  construed  to  apply  to  orders  placed  prior  to  June  14, 
1918,  for  shipment  after  September  14,  1918.  All  restrictions  as  to  deferred 
shipments  are  permitted  to  be  removed.  If  not  permitted  by  car  builders  to  be 
shipped  by  September  1.4,  the  price  applying  .at  the  time  of  delivery  shall  apply.* 

Procedure  for  distribution  of  southern  or  yellow  pine  lumber. — At  a  hearing 
of  the  manufacturers  of  southern  or  yellow-pine  lumber  before  the  price-fixing 

1  Official   Bulletin,  June   19,   1918. 

2  Price-Fixing  Committee  Minute  Book  V.  July  1,  1918  :  Official  Bulletin,  July  5,  1918. 

3  Price-Fixing  Committee  Minute  Book  VI,  July  15,  1918. 

1  Price-Fixing  Committee  Minute  Book  VI,  July  17,  1918  ;  Official  Bulletin,  July  19,  1918. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  755 

committee  of  the  War  Industries  Board  on  September  23,  1918,  it  was  agreed 
that  the  ruling  of  June  14,  1918,  fixing  maximum  f.  o.  b.  mill  prices  on  southern 
or  yellow-pine  lumber  should  remain  in  effect  from  midnight  September  23 
to  midnight  December  23,  1918,  inclusive. 

It  was  also  decided  by  the  price-fixing  committee  and  the  representatives  of 
Government  departments  that  inclusive  within  these  dates  timber  prices  on  the 
lumber  schedule  should  apply  to  all  shipments  to  Government  departments, 
including  the  Emergency  Fleet  Corporation. 

It  was  decided  by  the  price-fixing  committee  that  the  interpretation  of  the 
terms  of  sale  should  be  as  follows : 

The  usual  trade  practices  shall  continue,  including  2  per  cent  off  for  cash 
within  10  days  from  date  of  invoice  to  be  applied  to  United  States  Government 
purchases  as  well  as  all  others  (except  in  special  cases  where  former  trade 
practice  has  well  established  net  cash  terms  and  except  as  to  export  shipments 
to  foreign  countries).  In  transactions  where  purchasers  do  not  avail  them- 
selves of  cash  discounts  the  terms  shall  be  60  days  net  from  date  of  invoice, 
and  in  such  transactions  the  accounts  may  be  converted  into  trade  acceptances 
which  do  not  bear  interest  before  maturity. 

-  As  regards  the  requirement  by  the  Railroad  Administration  that  shippers 
shall  bulkhead  the  ends  of  open  freight  cars,  it  was  decided  that  an  extra 
charge  for  lumber  and  labor  for  constructing  bulkheads  may  be  made  by  the 
shipper  and  invoiced  to  consignee,  irrespective  of  whether  or  not  for  Govern- 
ment or  civilian  use. 

On  the  readjustment  of  item  prices  it  was  decided  that  the  director  of  lum- 
ber, in  conference  with  the  war-service  committee  of  the  manufacturers,  should 
have  discretion  to  make  certain  minor  changes  and  corrections  in  the  item 
prices,  which,  however,  should*  not  affect  the  average  base  price. 

As  to  price  concessions  made  by  manufacturers  to  wholesale  distributors,  it 
was  decided  to  incorporate  in  the  present  announcement  a  formal  statement, 
to  wit: 

That  in  cases  where  manufacturers  make  reductions  from  the  maximum 
prices  to  wholesale  dealers,  the  reductions  should  be  considered  in  the  nature 
of  an  allowance  to  cover  the  expense  and  profit  of  sales  by  wholesale  dealers 
and  should  not  be  interpreted  as  constituting  a  general  reduction  in  the  market 
price  of  lumber  to  the  trade. 

BIRCH  LOGS. 

An  informal  agreement  as  to  fair  and  reasonable  prices  for  birch  veneer  logs 
suitable  for  airplane  purposes  was  made  on  October  30,  1918,  at  a  conference 
in  which  the  lumber  section  of  the  War  Industries  Board,  bureau  of  aircraft 
production,  and  representatives  of  veneer  manufacturers  and  loggers  were  pres- 
ent. The  prices  agreed  upon,  f.  o.  b.  shipping  point,  for  logs  of  veneer  quality 
were  as  follows :  Logs  12  to  15£  inches  in  diameter,  $55  per  thousand  feet ;  logs 
16  inches  and  up  in  diameter,  $65  per  thousand  feet.  These  prices  remained 
unchanged  throughout  the  period  of  the  war. 

BLACK  WALNUT. 

No  official  price  was  set  on  black  \valnut  as  a  whole,  but  a  fixed  maximum 
price  was  set  on  gunstock  flitches  and  propeller  blades. 

On  August  10,  1917,  the  Ordnance  Department  of  the  United  States  Army 
fixed  a  maximum  price  of  $1.05  each  for  gunstock  dimension  blanks  f.  o.  b. 
mill.  On  August  1,  1918,  the  price  was  raised  to  $1.20  each  by  action  of  the 
price-fixing  committee  of  the  War  Industries  Board. 

The  Signal  Corps  of  the  United  States  Army  on  January  28,  1918,  fixed  a 
maximum  price  of  $310  per  thousand  board  feet  for  airplane  propeller  stock, 
which  was  continued  throughout  the  war. 

On  August  1,  1918,  the  price-fixing  committee  also  made  an  informal  agree- 
ment with  lumber  manufacturers  as  to  the  price  of  2$-inch  black  walnut  flitch, 


756 


HISTORY   OF  PRICES   DURING  THE   WAR. 


which  was  set  at  $80  per  thousand  board  feet  f.  o.  b.  mill.  This  price  was  not 
binding  on  manufacturers,  but  was  regarded  as  a  fair  price  for  the  material. 
An  informal  agreement  was  also  made  on  August  7,  1918,  between  the  price- 
fixing  committee  and  walnut  log  buyers  as  to  a  fair  and  reasonable  price  to 
be  paid  for  black  walnut  logs.  An  announcement  was  made  as  follows : 

As  an  aid  to  the  Government  in  securing  the  outturn  at  fair  and  reasonable 
prices  of  the  walnut  timber  necessary  for  its  needs  and  for  the  protection  of 
the  walnut  timber  owners  we  ask  that  you  give  publicity  to  the  following  ranges 
of  prices  for  each  diameter  which  the  log  buyers  or  the  walnut  manufacturers 
having  Government  contracts  for  gunstocks  and  propeller  lumber  will  pay  for 
good  walnut  logs  12  inches  and  up  in  diameter  and  8  feet  and  up  in  length. 


Diameter  (inches). 

Prices  of  black  walnut 
logs  8  feet  and  over 
long  on  board  cars  on 
railroad. 

Equivalent   value    for 
standing  timber. 

Minimum. 

Maximum. 

Minimum. 

Maximum. 

14                                            

PerM. 
£45 
55 
65 
75 
85 
95 
105 
115 
125 
135 

PcrM. 
$55 
65 
75 
85 
95 
105 
115 
125 
135 
150 

PC  r  M. 

S20 
30 
40 
50 
60 
70 
80 
90 
100 
110 

Per  M. 
$35 
45 
50 
60 
70 
80 
90 
100 
110 
120 

16                                                              .           

18                                               

20                             

22       

24                               

26                                                                      

28                                     

30                                                                                    

31  and  up                               

In  arriving  at  prices  which  it  is  paying  for  propeller  lumber  and  gunstocks 
the  Government  has  taken  these  log  prices  into  consideration,  and  has  allowed 
the  mills  prices  for  the  material  it  gets  which  will  allow  for  only  a  fair  and 
reasonable  profit  both  to  the  mills  and  the  log  buyer. 

The  above  prices  were  used  as  a  guide  only,  purchases  being  made  both  above 
and  below  those  given  in  the  log  price  list. 

CYPRESS  AND  TUPELO. 

The  maximum  price  of  cypress  and  tupelo  lumber  was  not  fixed  by  the  price- 
fixing  committee,  but  an  unofficial  price  list  was  issued  by  the  Cypress  emergency 
bureau,  which  was  recognized  as  representing  fair  and  reasonable  prices.  The 
list  was  dated  October  25,  1918,  and  was  in  effect  to  the  close  of  the  war  period. 

CYPRESS  EMERGENCY  BUREAU. 

[Net  cypress  and  Tupelo  list  for  Government  f.  o.  b.  mills  in  North  and  South  Carolina,  Georgia,  Florida, 

and  Louisiana.] 

CYPRESS. 


Rough,  random  width. 

Tank. 

Factory 
select. 

Shop. 

Box. 

Peck. 

1  inch                                    

$35.00 

$29.  50 

$25.00 

$16.00 

1J  inches     

40.50 

35.50 

26.00 

18.00 

$61.00 

43.00 

36.50 

26.00 

18.00 

2  inches  

67.00 

46.00 

38.50 

26.00 

16.00 

2J  inches  
3  inches  

85.50 

57.50 

50.50 

4  inches  

94.50 

For  SIS  or  S2S  add  $1.50  per  thousand. 

1-inch  to  2-inch  factory  select,  shop,  box  are  for  standard  lengths.    Add  $1  per  thousand  fc 

°VpriSsfCspecified  on  U  and  2  inch  tank  8  to  16  feet.    For  18  and  20  feet  add  $4  per  thousand.    On  2J  to  4 
inches,  all  grades,  add"$2  per  thousand  for  each  foot  over  18  feet. 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES. 


757 


Finishing  lumber  SIS  or  S2S. 

A. 

B. 

C. 

Select 
common. 

1  by  4,  6.  8,  and  10  inches  10/20 

$53  00 

$47  50 

$44  00 

J38  50 

1  by  12,  10/20  

58.50 

52.00 

51.00 

45  50 

1  by  4  to  12  inches,  R.  W.,  10/20 

53  00 

47  50 

44  00 

38  50 

1  by  13  to  19  inches,  inclusive.  10/16  J 

67  50 

62  00 

I  by  14  10/16  i 

65  00 

59  50 

1  by  16,  10/16  i  .  . 

69.50 

64  00 

1  by  18,  10/16  i 

74  00 

68  50 

1  by  20  to  23  inches  inclusive  10/16  J 

81  00 

75  50 

1  by  24  and  wider.  10/16  i  

94.50 

89.00 

li  by  4,  6,  8,  and  10  inches,  10/20  J 

56  50 

51  50 

47  50 

42  50 

if  by  12  10/20  i 

62  00 

56  00 

54  50 

49  oo 

1}  by  4  to  12  inches,  R.  W  .,  10/20  i  

56.50 

51.50 

47.50 

52  50 

i  by  13  to  19  inches,  10/16  i 

71>00 

65  50 

1  by  14,  10/16  i  

68.50 

63.00 

J  by  16,  10/161  

73.00 

67.50 

i:  by  18,  10/16  i 

77  50 

72  00 

\  by  20  to  23  inches,  inclusive,  10/16  i  

84.50 

80.00 

|  by  24  and  wider,  10/16  ». 

98.00 

92.50 

2  by  4  6  8  and  10  inches,  10/20 

66  50 

61  00 

53  00 

47  50 

2  by  12,  10/20  

72.00 

65.50 

60.00 

54.50 

2  by  4  to  12  inches,  R.  W.,  10/20  , 

66.50 

61.00 

53.00 

47.50 

2  by  13  to  19  inches,  inclusive,  10/16  l 

81  00 

75  50 

2  by  14,  10/16  i  

78.50 

73.00 

2  by  16,  10/161 

83.00 

77.50 

2  by  18,  10/16  1 

87  50 

82  00 

y 

2  by  20  to  23,  10/16  1 

94.50 

89.00 

2  by  24  and  wider,  10/16  1 

108.00 

102.50 

i  For  11  add  $1  over  price  1J. 

For  rough,  deduct  $1.50  per  thousand.     For  S4S,  add  50  cents  per  thousand. 

For  13  inches  and  wider  random  or  specified  widths,  add  $1  per  thousand  for  each  foot  over  16  feet. 

For  10  to  16  foot  lengths  in  2^  add  $13;  for  3  inches  add  $17;  and  for  4  inches  add  $23  to  price  of  2 inches. 

For  specified  lengths,!  to  2  inches,  add  $2  per  thousand;  2J  to  4  add  $2  per  thousand  for  each  foot  over 
16  feet. 

Panel  stock:  |  by  8  inches  and  wider,  S2S  to  &  inch,  $28;  i  by  8  inches  and  wider,  S2S  to  A  inch,  $34.50; 
g  by  8  inches  and  wider,  S2S  to  A  inch,  $40;  }  by  8  inches  and  wider,  S2S  to  ^  inch,  $47. 

For  specified  widths  up  to  12  inches,  add  $2.50. 

Wider  than  12  inches  and  less  than  16  inches, add  $6  per  M.  S.  M.;  16  inches  and  wider,  $9  per  M.  S.  M. 


.Flooring,  ceiling,  drop  siding, 

shiplap,  casting  and  base. 

A. 

B. 

C. 

Select 
common. 

|  by  4  or  6  inches  8/20 

$29  00 

$26  00 

$24  50 

i  by  4  or  6  inches  8/20 

36.50 

34.00 

32.00 

§  by  4  or  6  inches  8/20 

44.50 

42.00 

40.00 

1  by  3 

57.00 

49.00 

45.50 

$40.00 

1  by  456  and  8  inches  8/20 

56.50 

48.50 

45.00 

39.50 

1  by  10  8/20 

39.50 

1  by  12  8/20 

46.50 

For  11  inches,  add  $4;  \\  add  $5;  2  inches  add  $15  to  price  of  1  inch. 

For  partition  add  $5  per  thousand. 

Short  flooring,  ceiling,  etc.,  4  to  8  feet,  $4  per  thousand  less  than  standard  lengths,  in  same  width  and 

grade. 


Bevel  siding. 

A. 

B. 

C. 

D. 

\  by  4,  8/20  

$27.00 

$24.50 

$22.50 

$16.00 

i  by  5  8/20                   

27.00 

24.50 

22.50 

19.50 

i  bv  G  8/20                                                                    

28.00 

24.50 

22.50 

17.00 

by  4  or  6  mixed  lengths  only  from  inch  stock,  4  by  8  feet,  B  and  better,  $21. 


758 


HISTORY   OF   PRICES    DURING    THE    WAR. 


Bungalow  bevel  siding. 


C  and 
better. 


D. 


I  by  8  S4S  and  resawn  to  J  S.L 
1*  by  8,  resawn  to  £  S.L 

I 1  by  8,  resawn  to  f  inch 


$31.50 
40.50 
49.50 


$28.00 
37.00 
44.00 


$27.00 

•  36.00 

43.00 


826.  00 
35.00 
42.00 


For  specified  lengths,  add  SI. 
For  10-inch  width,  add  Si. 

BYRKIT   SHEATHING   LATH. 
[Long  lengths,  $19.50;  short  lengths,  $18.50;  all  orders  must  include  reasonable  percentage  of  short  lengths- 


Shingles. 


Best. 


Primes. 


Economy, 


Xax. 


Clipper. 


3 inches  dimension S3.75         $2.70 

4  inches  dimension -. 4.65  3.60          $2.70    $1.95 

5 inches  dimension 4.90  3.85  3.00    1.' 

G  inches  dimension 4.90  3.85  3.00    1.9.5 

Random $2.05  1.80 

TUPELO. 

Standard 

Rough:  lengths. 

Wagon  box  boards,  13  to  17  inches $40. 50 

Wagon  box  boards,  8  to  12  inches 37. 00 

First  and  seconds 29.  00 

No.  1,  common 26.  00 

No.  2,  common 23.  50 

No.  3,  common 18. 00 

Log  run,  No.  3,  common  and  better  with  firsts  and  seconds  out 23. 50 

Log  run,  No.  3,  common  and  better  with  firsts  and  seconds  in 24.  25 

1  by  3  wider,  12  to  36  inches,  C  and  better,  shorts 21. 50 

Finish,  flooring,  ceiling,  siding,  partition,  worked: 

Finish  B  and  better,  4  to  10  inches,  specific  widths 33. 50 

Finish  Band  better,  12  inches 38.00 

Finish  B  and  better,  4  to  12  inches,  assorted  widths 34. 00 

Finish  B  and  better,  13  inches  and  wider 43. 00 

Finish  C,  4  to  10  inches,  specified  widths 27. 00 

Finish  C,  12  inches 31. 50 

Finish  C,  4  to  12  inches  assorted  widths l  28.  00 

Flooring  and  ceiling,  B  and  better 1  36. 00 

Flooring  and  ceiling,  C ^l.SO 

Partition,  B  and  better 1  40. 50 

Partition,  C 36.00 

Drop  siding,  C  and  better ;'. 31. 50 

Bevel  siding,  B  and  better 20.00 

Bevel  siding,  C -----    18.00 

When  specific  prices  are  not  given  on  worked  stock  add  the  following  working  charges,  stock  to  be 
graded  before  working: 
Add  $1.50  for  each  resaw. 
Add  $0.50  for  each  rip  or  cross  cut. 
Add  $3  for  each  S2S  and  resaw. 
Add  $4  for  resawing  and  S2S  afterwards. 
Add  $2.50  for  making  flooring,  shiplap,  ceiling,  grooved  roofing,  jambs,  bevel  cribbing,  or  drop  siding- 


No.  1  common  rough. 


Iby3.. 
Iby4.. 
Iby5.. 
Ibyfi.. 
Iby8.. 

1  by  10. 
Ibyl2. 

2  by  4.. 
2byC.. 
2  by  8.. 
2  by  10. 
2  by  12. 


R.  L 


$32.50 
32.50 
32.50 
32.50 
32.50 
32.50 
38.00 
34.00 
34.00 
34.00 
34.00 
39.50 


6  and  8. 


S30.50 
30.50 
30.50 
30.50 
30.50 
30.50 
36.00 
32.50 
32.50 
32.50 
32.50 
38.00 


10 


$32.  50 
32.50 
33.50 
32.50 
32.50 
33.50 
39.50 
34.00 
34.00 
34.00 
35.00 
41.50 


12 


$32.50 
32.50 
34.00 
32.50 
32.50 
34.00 
40.50 
34.00 
34.00 
34.00 
36.00 
42.50 


$32.50 
33.50 
31.00 
32.50 
32.50 
31.50 
37.00 
34.00 
34.00 
34.00 
33.50 
38.50 


S33.50 
33.  50 
33.00 
35.00 
32.50 
33.00 
38.00 
35.00 
34.00 
34.00 
34.50 
39.50 


$32.50 
33.50 
34.00 
32.50 
33.50 
34.00 
40.50 
35.00 
34.00 
35.00 
36.00 
42.50 


$32.  50 
34.00 
35.00 
32.50 
34.00 
34.50 
42.50 
36.00 
34.00 
36.00 
36.50 
44.00 


For  specified  lengths  add  $1  per  thousand  feet  to  these  prices. 


GOVEKNMENT   REGULATIONS  RELATING  TO   PRICES. 


759 


No.  2  common  rough. 

R.  L. 

6  and  8. 

10 

12 

14 

1C 

18 

20 

Iby3  

1  by  4 

$29.00 
28.50 

$27.00 
26  50 

$29.00 
28  50 

$29.00 
28  50 

$29.00 
28  50 

$31.50 
28  50 

$29.00 
29  50 

$29.  00 
29  50 

1  by  5 

28  50 

26  50 

29  50 

29  50 

29  50 

28  50 

29  50 

30  00 

Iby6  
Iby8 

28.50 
28.50 

26.  50 
26  50 

28.  50 
28.50 

28.50 
28.50 

28.50 
28.50 

31.00 
28  50 

28.50 
29.50 

28.50 
29  50 

IbylO... 

28.50 

26.50 

29.50 

29.50 

28.50 

28.50 

29.50 

30.00 

Ibyl2  

2  by  4. 

32.50 
30.00 

30.50 
28.50 

33.50 
30.00' 

33.50 
30.00 

32.50 
30.00 

32.50 
30.00 

33.50 
31  00 

34.  50 
31  00 

2  by  6 

30  00 

28  50 

30  00 

30  00 

30  00 

30  00 

30  00 

30  00 

2  by  8... 

30.00 

28.50 

30.00 

30.00 

30.00 

30.00 

31.00 

31.00 

2  by  10 

30.00 

28.  50 

31.00 

31.00 

30.00 

30  00 

31  00 

32  00 

2  by  12 

34  00 

32  50 

35  00 

35  00 

34  00 

34  00 

35  00 

36  50 

For  H  and  l\  add  $2  to  price  of  1  inch. 
For  SIS  or  S2S  add  $1.50  per  thousand  feet. 
For  S4S  or  SIS  and  IE  add  $2  per  thousand  feet. 
Timbers  (green),  rough: 

3  by  4,  4  by  4,  4  by  6,  10/16 $31. 50 

3  by  6 and 3  by  8, 10/16 32.50 

3  by  10  and  3  by  12, 10/16 31. 00 

6by6and6by8 134.00 

For  SIS  or  S2S,  add  $1.50  per  thousand. 
For  S4S  or  SIS  and  IE,  add  $2  per  thousand. 
Battens,  10/16: 

|  by  3  inches,  SI  S , 5. 00 

|  by  3  inches,  O.  G 5. 25 

2-inch  O.  G.  finish,  13/16  by  If  inches 6. 50 

2i-inch  O.  G.  finish,  13/16  by  2£  inches 9. 00 

For  18  and  20  foot  battens  add  25  cents. 
Lath: 

No.  1,  |  by  1J  inches,  4-foot 4.25 

No.  2,  §  by  li  inches,  4-foot. 


No.  1,  |  by  1|  inches,  32-inch 1. 80 

No.  1,  |  by  1 J  inches,  4-foot 7. 65 

DOUGLAS  FIR. 

The  first  price  control  of  Douglas  fir  was  carried  out  by  the  Douglas  Fir 
Emergency  Bureau,  and  the  item  prices  listed  at  that  time  were  in  effect  from 
December  1,  1917,  to  March  1,  1918. 

These  prices  were  adopted  by  the  price-fixing  committee,  to  be  effective  from 
March  19,  1918,  to  June  1,  1918. 

The  entire  fir  schedules  were  revised  in  June,  1918,  by  the  price-fixing  com- 
mittee and  the  lumber  director.  The  new  prices  represented  an  average  increase 
of  approximately  $2.75  per  thousand  board  feet  and  were  made  applicable  to 
both  the  Government  and  public  purchases. 

The  new  schedules  became  effective  June  15,  1918,  and  provided  a  base  price 
for  Douglas  fir  of  $26  per  thousand  feet ;  $40  per  thousand  feet  for  rough  and 
dressed  timber,  and  $50  for  aircraft  timbers.  The  log  range  was  from  $12  to 
$20  per  thousand  feet. 

The  following  announcement  by  the  price-fixing  committee  accompanied  the 
schedules  of  June  15,  1918: 

No  regulation  has  been  made  with  regard  to  transactions  other  than  sales  by 
manufacturers  at  the  schedule  prices.  Wholesale  dealers,  retail  dealers,  and  all 
others  are  entitled  to  buy  on  the  basis  of  these  f.  o.  b.  mill  prices.  As  yet  no 
regulation  of  rates  or  profits  has  been  made  writh  regard  to  sales  either  by 
wholesalers  or  retailers  to  consumers.  The  War  Industries  Board  believes  that 
sales  by  all  dealers  should  be  made  at  reasonable  prices  based  on  a  strictly 
reasonable  profit  above  the  fixed  schedule  rates.  The  board  'is  confident  that 
the  trade  will  conform  to  the  spirit  of  the  existing  regulations  and  the  board 
will  not  proceed  to  further  regulation  or  restriction  of  dealers'  prices  until 
their  conduct  of  business  indicates  that  such  action  is  necessary. 2 


1  For  18  and  20  foot  add  $1  per  thousand. 

2  Official  Bulletin,  June  24, 1918. 


760 


HISTORY   OF  PRICES  DURING  THE   WAR. 


The  prices  of  June  15,  originally  effective  for  90  days,  were  extended  to 
October  15,  1918,  and  at  that  time  it  was  agreed  that  they  should  be  continued 
until  January  15,  1919,  when  all  price  control  over  Douglas  fir  was  discontinued. 

Airplane  fir. — On  April  10,  1918,  the  spruce  production  division  of  the  Signal 
Corps  of  the  United  States  Army  issued  a  schedule  of  prices  for  Douglas  fir 
airplane  material.  The  f.  o.  b.  mill  price  for  lumber  cut  to  specification  was 
$65  per  thousand  board  feet.  In  July  these  prices  were  superseded  by  others 
which  carried  a  price  of  $50  per  thousand  board  feet  f.  o.  b.  mill. 

The  War  Industries  Board  announced,  on  March  19,  1918,  the  following 
rulings : 

That  the  maximum  price  for  fir  logs  in  the  Pacific  Northwest,  delivered  at 
the  points  where  it  has  been  customary  to  make  delivery  to  the  sawmill  opera- 
tors, be  fixed  at  $19  per  1,000  for  No.  1  logs,  $15.50  per  1,000  for  No.  2  logs, 
and  $10  per  1,000  for  No.  3  logs,  scale  as  to  grade  and  contents  to  be  determined 
according  to  the  methods  that  have  been  customary  in  the  various  districts  for 
the  past  four  or  five  years.  These  prices  are  a  basis  for  logs  up  to  and  including 
40  feet  in  length.  Logs  over  40  feet  in  length  to  be  priced  on  the  same  basis  for 
extra  lengths  as  has  heretofore  been  established  by  custom.  In  no  case  shall 
nny  greater  price  than  that  mentioned  above  be  allowed  for  logs  of  those  grades 
during  the  period  of  March  19  to  May  31,  1918. 

That  the  price  of  fir  ship  timbers  under  the  Ferris  schedule  to  the  Emergency 
Fleet  Corporation  be  readjusted  at  item  prices  that  will  average  $40  per  1,000 
for  a  complete  schedule  for  both  the  rough  and  dressed  items,  and  that  all  sales 
of  lumber  for  other  vessels  under  Government  contract  requiring  a  schedule 
of  lumber  of  similar  type  shall  be  furnished  at  not  to  exceed  the  same  basis  of 
prices. 

That  the  prices  of  fir  lumber  for  aircraft  use  to  both  the  United  States 
Government  and  the  Allies  remain  the  same  as  those  now  in  effect  (Mar.  19, 
1918). 

That  the  prices  of  all  other  items  of  fir  lumber  remain  the  same  as  those 
enumerated  in  the  appended  list  of  the  Douglas  fir  emergency  bureau,  effective 
between  the  dates  of  December  1,  1917,  and  March  1,  1918,  to  all  other  depart- 
ments of  the  Government  be  continued  in  effect  to  May  31,  1918. 

Prices  named  on  West  Coast  Lumber  Association's  yellow  sheet  bearing  date 
December  1,  1917,  covering  timber  34  feet  and  longer,  shall  be  canceled  and  a 
price  of  $6  per  1,000  over  West  Coast  price  list  of  May  1,  1915,  hereby  is  made 
effective  for  timbers  of  above  lengths  until  May  31,  1918.  Prices  on  items  not 
covered  by  above  list  shall  be  based  on  the  nearest  comparable  item.  It  is 
understood  that  during  this  time  the  loggers  and  lumber  manufacturers  will 
not  reduce  the  scale  of  wages  now  being  paid. 
F.  o.  b.  mill  prices  December  1, 1917,  and  May  31, 1918: 

FIR  COMMON  BOARDS  SIS  OR  SHIPLAP. 

1  by  2,  6  to  20  feet,  mixed  lengths,  SIS $1 8 . 00 

1  by  3,  6  to  20  feet,  mixed  lengths,  SIS 18.00 

Iby4,  6  to  20  feet,  mixed  lengths,  SIS 16.00 

1  by  6,  6  to  20  feet,  mixed  lengths,  SIS  or  S.L... , 16.50 

1  by  8,  6  to  20feet,  mixed  lengths,  SIS  or  S.  L 17. 50 

Iby  10  6  to  20 feet,  mixed  lengths,  SIS  or  S.  L 17.50 

1  by  12,  6  to  20  feet,  mixed  lengths,  SIS  or  S.  L 18. 00 

For  selected  common  add  $3;  for  D.  and  M.  add  $1.50;  for  grooved  roofing  add  $3.  Orders  for  16,  18, 
and  20  feet  only  add  $2.  Other  orders  for  specified  lengths  add  $1  to  above  prices.  Number  2  common 
boards  and  shiplap  $3  less  when  in  stock. 


Fir  common  dimensions,  S1S1E. 

6  feet. 

8,  12,  14 
feet. 

16  feet. 

9  to  10, 
18  to  20 
feet. 

22  and 
24  feet. 

26  to  32 
feet. 

2  by  3  2  by  4 

$15.50 

$16.50 

$17.  50 

$18.50 

$19.50 

$21.50 

2  by  Q  2  by  8                             

15.50 

16.00 

17.00 

17.50 

18.50 

20.00 

2  by  10                    

16.00 

17.00 

17.50 

18.00 

19.00 

21.00 

2hT712  

16.50 

17.50 

18.00 

18.50 

19.50 

21.50 

2  by  14                                                   

19.00 

19.00 

20.00 

21.00 

23.00 

20.00 

20.00 

21.00 

22.00 

24.00 

2  by  18                                          

22.00 

22.00 

23.00 

24.00 

26.00 

2  by  20  

24.00 

24.00 

25.00 

26.00 

28.00 

Add  50  cents  for  every  2  feet  over  32  feet  long  up  to  40  feet. 
For  select  common  add  $3.    S1E  or  rough  same  mill  base  as  dressed.     For  2  by  4,  2  by  6,  or  2  by  8  D. 
&  M.  or  shiplap  add  to  S1S1E,  $1.50.    Hemlock  permitted  in  2  by  4  and  2  by  6. 


GOVERNMENT  REGULATIONS   RELATING   TO   PRICES. 

FIR  COMMON    PLANK   AND    SMALL   TIMBERS   S1S1E    OR   S4S. 


761 


8,  12,  14, 
and  16 
feet. 

9  to  10, 
18  and  20 
feet. 

22  and  24 
feet. 

26  to  32 

feet. 

3  by  3,  3  by  4... 

$17.00 

$17.  50 

$18.50 

$20.50 

3by6                                                                                

18.00 

18.50 

19.50 

21.50 

4  by  4  4  by  6  4  by  8 

18.50 

19.50 

20.50 

22  50 

3by8'            '                                              ,  

18.00 

18.50 

.      19.  50 

21.50 

3  by  10  3  by  12 

18.50 

19?50 

20.50 

22.50 

3by  14.                                                    

19.00 

20.00 

21.00 

23.00 

3  by  16 

20.00 

21.00 

22.00 

24.00 

3byl8.                                      

22.00 

23.00 

24.00 

26.00 

3  by  20 

24.00 

25.00 

26V00 

28.00 

4  by  10  4  by  12 

18.50 

19.50 

20.50 

22.50 

4  by  14 

19.50 

20.50 

21.50 

23.50 

4  by  16 

20.50 

21.50 

22.50 

24.50 

4  by  18                                                             .                    

22.00 

23.00 

24.00 

26.00 

4  by  20 

24.00 

25.00 

26.00 

28.00 

6by6to8by8  ...                   ....                 

18.00 

19.00 

20.00 

22.00 

Add  50  cents  for  every  2  feet  over  32  feet  Ion?  up  to  40  feet. 

For  selected  common  add  $3  S1E  or  rough  same  mill  base  as  dressed. 

FIR  TIMBERS,  SINGLE   CARLOAD   LENGTHS. 


32  feet  and  under. 


Rough. 

S1S1E  or 

S4S. 

6  by  10  to  8  by  12                                       .                  

$20.00 
20.50 
22.00 
23.00 
24.50 
27.  50 
31.00 
20.00 
20.50 
25.00 
27.00 
30.00 
21.50 
23.50 
24.50 
26.50 
30.00 

$21.00 
22.50 
24.50 
26.00 
27.50 
31.00 
35.00 
21.00 
23.00 
28.50 
30.75 
34.00 
25.00 
27.50 
29.00 
31.50 
35.50 

6  by  14  to  8  by  14                                                                                                    

6  by  16  to  10  by  16                                                   

6  by  18  to  10  by  18                '                                                                                 

6  by  20  to  8  by  20                                                              

6  by  22  to  8  by  22                                                                                             

6  by  24  to  8  by  24                                                 

10  by  10  to  12  by  12                                                                         

10  by  14  to  14  by  14                                    

10  by  20  to  12  by  20                                                                  

10  by  22  to  12  by  22                          

10  by  24  to  12  by  24                                                    

12  by  16  to  16  by  16  

12  by  18  to  18  by  18                                                     .-<«  

14  by  20  to  20  by  20  

14  by  22  to  22  by  22                                              •'- 

14  by  24  to  24  by  24...                                                       

FIR,   TIMBERS,   SINGLE  CARLOAD   LENGTHS. 

For  odd  or  fractional  thicknesses  add  to  next  less  thickness  50  cents.  Odd  or  fractional  length  timbers 
ordered  shall  be  counted  as  of  next  longer  even  length.  For  odd  or  fractional  widths  add  to  next  less  width 
$1.  For  select  common  add  $3. 


No.  1. 

No.  2. 

No.  3. 

1  by  4  10  to  16  feet  V 

G  fl  ooring                                   

$37.00 

$34.00 

$28.00 

1J  by  4  6  to  16  feet  V 

G  flooring                                            

40.50 

36.50 

30.50 

NOTE.—  No.  1  and  No.  2  V.  G.  flooring  1  by  4,  6,  7,  8,  and  9  feet,  $1  less  when  in  stock;  No.  3  V.  G.,  $2 
less.    All  4  and  5  feet,  $5  less.    Short  flooring  subject  to  stock  on  hand.    Specified  lengths  $2  extra. 

> 

No.  2 
clear  and 
better. 

No.  3. 

$24.  00 
27.00 

$21.00 
25.00 

All  flat  grain  flooring  6, 1,  8,  and  9  feet,  $2  less.    All  4  and  5  feet,  $5  less.    Specified  lengths,  $2  extra. 
No.  2  clear  and  better;  1},  H  or  2  inches,  8  to  12  inches  wide,  3  to  16  feet,  V.  G.  fir  stepping  S2S,  or  S2S 
and  nosed,  $45;  14  inch,  $2  extra;  specified  lengths,  $2  extra. 


762  HISTORY   OF  PRICES   DURING  THE   WAR. 

FIR  FINISH  NO.  2  AND  CLEAR  AND  BETTER,  6  TO  16  FEET  LONG. 


S2Sor 
S4S. 

Rough 
dry. 

Rough 
green. 

1  by  4.... 

$34  00 

$3^  00 

«;qi"i   nn 

IbyG  

35  00 

33  00 

31    00 

1  by  5,  8  and  10  inches 

36  00 

34  00 

qo   f)A 

Ibyl2  

38  00 

36  00 

34  00 

1|  and  H  by  4  and  6  inches. 

37  00 

35  00 

33  00 

1J  and  U  by  f  ,  10  and  12  jnches  

39  00 

37  00 

35  00 

2  by  4  

34  00 

32  00 

30  00 

2by6  

35  00 

33  00 

31  00 

2  by  8  and  10  inches.  .  .  . 

36  00 

34  00 

3°  00 

2byl2  .-. 

38  00 

36  00 

34  00 

2J,  3,  and  4  inches  (green  only)... 

36  00 

For  each  inch  in  width  over  12  inches  add  SI.    Specified  lengths,  $2  extra. 
For  selected  slash  grain  add  $10.    For  vertical  grain  add  $7. 

CEILING. 


No.  2 
clear  and 
better. 

Xo.  3 
clear. 

tea 

10  to  16  feet, 
10  to  16  feet, 

c. 
c. 

and 
and 

E 
E 

,B.orC.  and 
,  B.  or  C.and 

E. 
E. 

V  
V  

$23.  00 
24.00 

$17.50 
21.00 

Six  to  9  feet,  S3  less;  4  and  5  feet,  85  less.    Specified  lengths,  S2  extra. 

Fix  partition,  £5  more  than  ceiling.    For  6-mch  ceiling  or  partition  add  $3.50  to  the  price  of  4-inch. 

1  by  6,  10  to  16  feet,  drop  siding  and  rustic: 

No.  2  clear  and  better ^ §26. 00 

No.  3  clear 23. 00 

Six  to  9  feet,  $3  less;  4  and  5  feet,  $5  less.  Specified  lengths,  $2  extra.  Orders  for  drop  siding  patterns 
other  than  Xo.  106  must  include  the  other  grade  accumulated  in  working  at  grade  prices. 

(June  11,  1919.) 

After  considering  the  information  submitted  by  the  Federal  Trade  Commis- 
sion as  to  the  cost  of  logging  and  of  manufacturing  lumber  and  the  information 
submitted  by  the  representatives  of  the  loggers  and  lumber  manufacturers  of 
the  Pacific  Northwest  at  the  hearings  held  on  Monday  and  Tuesday,  June  10 
and  11,  1918,  at  which  their  request  for  a  readjustment  of  prices  on  their 
products  was  heard,  the  price-fixing  committee,  appointed  by  the  President, 
has  determined  upon,  by  agreement  with  the  said  representatives  of  the  loggers 
and  lumber  manufacturers  of  the  Pacific  Northwest,  the  following  maximum 
prices  for  fir  logs  and  fir  lumber  produced  in  the  Pacific  Northwest,  which 
maximum  prices  shall  not  be  exceeded  on  any  sales  and  contracts  for  the  sale 
thereof  (for  mill  shipment)  made  during  a  period  of  three  months  beginning 
midnight  June  15,  1918,  'either  to  the  public,  to  the  Government,  to  Govern- 
ments of  the  nations  associated  with  us  in  the  present  war,  or  the  railroads, 
whether  by  rail  or  by  water  shipment : 

The  maximum  price  for  fir  logs  in  the  Pacific  Northwest  delivered  at  points 
where  it  has  been  customary  to  make  deliveries  to  the  sawmill  operators  shall 
be  $20  per  thousand  for  No.  1  logs,  $16  per  thousand  for  No.  2  logs,  and  $12 
per  thousand  for  No.  3  logs,  scale  as  to  the  grade  and  contents  to  be  determined 
according  to  the  methods  that  have  been  customary  in  the  various  districts. 
Said  prices  are  on  a  basis  of  logs  up  to  and  including  40  feet  in  length  ;  logs 
over  40  feet  in  length  to  be  priced  on  same  basis  for  extra  lengths  as  has  here- 
tofore been  established  by  custom  or  (in  case  of  uncertainty  or  question  or 
variation  in  the  different  districts  as  to  past  custom,  as  to  point  of  delivery, 
method  of  scaling,  or  prices  for  extra  lengths)  as  may  be  decided  by  the 
lumber  section  of  the  War  Industries  Board.  In  no  case  shall  any  greater 
prices  than  those  mentioned  above  be  allowed  for  logs  during  the  period  men- 
tioned. Any  additional  cost  for  log  freights  occasioned  by  order  No.  28  of 
the  Director  General  of  Railroads  to  be  added  to  foregoing' log  prices  on  logs 
so  affected. 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  763 

The  price  of  fir  ship  timbers  under  the  Ferris  schedule  to  the  Emergency 
Fleet  Corporation  to  remain  the  same  as  thoso  determined  upon  by  the  price- 
fixing  committee  March  19,  1918,  namely :  Item  prices  that  average  $40  per 
thousand  for  a  complete  schedule  for  both  the  rough  and  dressed  items,  and 
all  sales  of  lumber  for  other  vessels  requiring  a  schedule  of  lumber  of  similar 
type  shall  be  furnished  at  not  to  exceed  the  same  basis  of  prices. 

The  prices  of  fir  lumber  for  aircraft  use  to  remain  the  same  as  those  now  in 
effect. 

The  prices  of  all  other  items  of  fir  lumber  shall  be  based  on  the  West  Coast 
price  list  of  May  1,  1915,  plus  additions  noted  on  discount  sheet  No.  22  of 
February  15,  1918,  on  the  following  items : 

All  items  of  No.  3  clear  and  better. 

All  items  of  fir  timbers  larger  than  8  by  8  dimension  of  all  lengths. 

All  items  3  inches  and  thicker  and  10  inches  and  wider  and  plus  $1  per 
thousand  less  than  discount  sheet  No.  22  on  all  remaining  items  of  fir  on  said 
lumber  list. 

Prices  on  items  not  covered  by  above  list  shall  be  priced  on  basis  of  nearest 
comparable  item. 

The  custom  of  delivered  prices  of  lumber  to  purchasers'  destination  points 
shall  remain  unchanged. 

Contracts  for  sale  of  logs  and  of  lumber  entered  into  in  good  faith  prior  to 
midnight  of  June  15?  1918,  and  enforcible  at  law  will  be  performed  in  accord- 
ance with  their  terms,  subject,  of  course,  to  orders  received  from  the  Govern- 
ment which  may  require  priority. 

It  is  imperative  that,  with  the  least  possible  disruption  of  the  industry,  the 
vast  war  needs  of  the  Government,  both  direct  and  indirect,  for  fir  logs  and 
fir  lumber  be  supplied  on  a  fair  basis;  that  an  adequate  supply  and  equitable 
distribution  thereof  be  assured  for  essential  commercial  needs ;  that  the  move- 
ment thereof  be  facilitated,  and  that  injurious  speculation  therein  be  pre- 
vented. Therefore  the  procedure  outlined  below,  by  agreement  with  the  repre- 
sentatives of  the  loggers  and  lumber  manufacturers  of  the  Pacific  Northwest, 
has  been  adopted  for  a  period  of  three  months  beginning  midnight  June  15, 
1918. 

The  procedure  is  that  each  fir  logger  and  each  manufacturer  of  fir  lumber  in 
the  Pacific  Northwest  shall — 

(1)  Make  contracts  for  the  sale  of  his  products  and  accept  orders  therefor  at 
prices   not   exceeding  the  applicable  maximum  prices,   always   subject   to   an 
option  at  the  applicable  maximum  prices  in  favor  of  the  United  States  or  the 
nominee  of  the  War  Industries  Board.     Under  this  option,  which  will  cover  all 
fir  logs  and  lumber  down  to  the  time  of  actual  delivery  to  the  purchaser,  the 
War  Industries  Board,  to  any  extent  required,  will  allocate  either  to  the  Gov- 
ernment or  to  other  essential  users.     Any  balance  not  so  allocated   will  be 
released  for  sale  to  commercial  buyers,  but  at  prices  no  greater  than  those 
determined  upon  as  above  set  forth. 

(2)  Comply  with  the  directions  of  the  War  Industries  Board  as  issued  from 
time  to  time  with  reference  to  filling  commercial  requirements  in  the  order  of 
their  public  importance  and  to  furnishing  such  information  and  making  such 
reports  as  may  be  required. 

(3)  Keep  up  to  the  best  of  his  ability  the  production  of  logs  and  lumber, 
so  as  to  insure  an  adequate  supply  so  long  as  the  war  lasts. 

(4)  Neither  reduce  the  scale  of  wages  now  being  paid  nor  change  funda- 
mental labor  conditions  now  in  force. 

The  Government  will  apportion  the  car  supply  available  for,  and  arrange  for 
the  transportation  of,  logs  and  lumber,  subject  to  allocation  by  the  War 
Industries  Board  as  aforesaid,  to  the  end  that  injury  to  the  industry  due  to 
abnormal  war-time  conditions  be  neutralized  so  far  as  may  be. 

Foreign  trade,  except  to  the  Governments  of  nations  associated  with  us  in 
the  present  war,  is  not  to  be  affected  by  this  ruling. 

(June  12,  1918.) 

The  maximum  price  for  Douglas  fir  logs  in  the  Pacific  Northwest  having  been 
fixed  by  the  price-fixing  committee  of  the  War  Industries  Board  as  follows : 

No.  1  grade $20.00 

No.  2  grade 

No.  3  grade . 12.  00 


764  HISTORY   OF   PRICES   DURING   THE   WAR. 

It  is  determined  that  the  above  prices  constitute  the  basis  for  logs  up  to  and 
including  40  feet  in  length. 

It  is  further  determined  that  the  above  prices  are  net  cash  upon  determina- 
tion of  log  scale. 

Scale  as  to  grade  and  contents  shall  be  according  to  custom,  with  the  excep- 
tions hereinafter  noted. 

All  fir  logs,  other  than  those  graded  No.  1,  No.  2,  or  No.  3,  shall  be  entitled 
to  a  maximum  price  of  $16,  with  the  exception  that  logs  15  inches  and  under 
at  top  end  shall  be  classified  as  No.  3  logs  and  shall  be  so  scaled,  priced,  and 
invoiced.  This  also  applies  to  No.  1,  No.  2,  and  No. '3  graded  logs.  All  coarse, 
large  logs  containing  defects  similar  to  the  No.  3  grade  shall  be  scaled,  priced, 
antl  invoiced  as  No.  3  logs. 

Custom  as  to  log  delivery  shall  remain  unchanged,  except  as  applying  to  the 
delivery  of  logs  on  Grays  Harbor  and  Willapa  Harbor,  in  the  State  of  Washing- 
ton, in  which  districts  mills  shall  absorb  towage. 

The  price  of  fir  logs  shall  neither  directly  nor  indirectly  be  added  to  by  any 
log  producer  through  the  compelling  of  the  purchaser  to  take  hemlock  logs  with 
the  fir  logs  at  any  price  higher  than  the  then  maximum  price  of  No.  3  fir  logs. 
Hemlock  logs,  when  ordered  by  the  purchaser  or  rafted  separately,  are  not 
subject  to  said  restriction. 

Long  logs  J,2  feet  and  over. — A  long  log  is  to  be  construed  as  one  42  feet  and 
longer,  18  inches  and  over  in  diameter  at  the  top  end,  suitable  for  the  manufac- 
ture into  a  square  edge  and  sound  timber. 

Long-log  differentials  hereinafter  named,  in  the  case  of  the  graded  logs,  are 
to  be  added  to  the  price  of  a  No.  2  log,  and  in  the  ungraded  logs  are  to  be 
added  to  the  price  of  the  ungraded  $16  log. 

The  hereinafter-named  differentials  on  long  logs  shall  only  apply  when  such 
logs  are  ordered  by  the  purchaser. 

Logs  27  inches  <n\<l  'under  at  top  entf. — Logs  in  this  class,  when  specifically 
ordered  in  lengths  42  feet  and  over,  carry  the  differentials  enumerated  below.; 

42  to  50  feet _  $2.  00 

52  to  60  feet 4.  00 

62  to  70  feet 6.  00 

72  to  80  feet 9.  00 

82  to  90  feet 12.00 

92  to  100 -feet 15.00 

Logs  2S  inches  and  orcr  at  top  end. — 

42  to  50  feet _  $6.  00 

52  to  60  feet 8.  00 

62  to  70  feet___ 11.00 

72  to  80  feet 14.00 

82  to  90  feet 18.  00 

92  to  100  feet 25.00 

Provided  the  above  spread  in  prices  shall  be  limited  as  follows : 

Logs  longer  than  60  feet  shall  take  the  60-foot  price  to  the  extent  of  10  per 
cent  of  the  raft  unless  specifically  ordered,  and  when  so  ordered  such  longer 
lengths  shall  take  the  regular  differentials.  In  no  event  shall  lengths  longer 
than  those  ordered  above  60  feet  in  length  exceed  10  per  cent  of  the  total  scale 
of  the  raft.  All  logs  over  60  feet  in  length  in  excess  of  10  per  cent  of  the  total 
contents  of  the  raft  shall  be  invoiced  at  the  base  price  unless  ordered. 

Logs  over  100  feet  in  length  subject  to  special  rates. 

Fir-production  board  to  have  authority,  under  the  lumber  section  of  the 
"War  Industries  Board,  in  all  matters  of  interpretation  of  rulings  as  applied 
to  the  scaling  of  logs  and  inspection  of  lumber  and  other  minor  points. 

(June  15, 1918.) 

Government  maximum  f.  o.  b.  mill  base  prices  for  Douglas  fir  lumber  effective  midnight  June  ]5,  1918, 
to  midnight  September  15,  1918,  in  accordance  with  the  ruling  of  the  price-fixing  committee  of  the  War 
Industries  Board,  dated  June  11,  1918. 


V.  G.  flooring. 

No.  1. 

No.  2. 

No.  3. 

1  by  4,  10  to  16  feet  

$42.00 

$39.00 

$33.00 

1}  by  4,  6  to  16  feet  

45.50 

41.50 

35  50 

NOTE.— No.  1  and  No.  2  V.  G.  flooring  l  by  4,  6,  7,  8,  and  9  fee\  $1  less  when  in  stock.    No,  3  V.  G.,  $2 
Jess.    All  4  and  5  feet,  $5  less.    Short  flooring  subject  to  stock  on  band.    Specified  lengths,  $2 extra. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


765 


Flat  grain  flooring. 

No.  2 

clear  and 
better. 

No.  3. 

1  by  4,  10  to  16  foot... 

$29.00 

$26.00 

1  by  6,  10  to  16  foot  

32.00 

30.00 

All  flat-gj:ain  flooring  6,  7,  8,  and  9  feet, .$2  less;  all  4  and  5  feet,  S5  less.   Specified  lengths,  $2  extra. 


• 

Ceiling. 

No.  2 
clear  and 
better. 

No.  3 
clear. 

iby  4, 

10  to  16  feet,  C.  and  E.,  B.  or  C.  and  E.  V  ... 

$28  00 

$22  50 

Iby  4, 

10  to  16  feet,  C.  and  E.,  B.  or  C.  and  E.  V 

29  00 

26  00 

NOTE.— 6  to  9  feet,  $3  less;  4  and  5  feet,  $5  less.    Specified  lengths,  $2  extra.    Fir  partition  $5  more  than 
ceiling.    For  6-inch  ceiling  or  partition  add  $3.50  to  the  price  of  4-inch. 


Stepping. 


No.    2 

clear  and 

better. 


,  1*,  or  2  inches,  8  to  12  niches  wide,  3  to  16  feet . 


S50.00 


V.  G.  fir  stepping  S2S  or  S2S  and  nosed. 

NOTE.— 14  inches,  $2  extra;  specified  lengths,  $2  extra. 


. 

Drop  siding  and  rustic. 

No.  2 
clear  and 
better. 

No.  3 
clear. 

1  by  6fg  foot  drop  si 

ding  and  rustic  

$31.00 

$28.50 

NOTE.— 6  to  9  feet,  $3  less,  4  and  5  feet,  $5  less.    Specified  lengths,  $2  extra.    Orders  for  drop  siding  pat- 
terns other  than  No.  106  must  include  the  other  grade  accumulated  in  working  at  grade  prices. 

FIR  FINISH  NO.  2  CLEAR  AND  BETTER,  6  TO  16  FEET  LONG. 


S2Sor 
S4S. 

Rough 
dry. 

Rough 
green. 

1  by  4 

$39  00 

$37  00 

$35  00 

Iby6  

40.00 

38.00 

36.00 

1  by  5,  8  inches  and  10  inches 

41  00 

39  00 

37  00 

Ibyl2  

43.00- 

41.00 

39.00 

11  and  Ik  by  4  and  6  inches 

42.00 

40.00 

38  00 

Hand  1J,  5,  8,  10,  and  12  inches  

44.00 

42.00 

40.00 

2  by  4... 

39.00 

37.00 

35.00 

2  by  6     .  . 

40  00 

38  00 

36  00 

2  by  8  and  2  by  10  

41.00 

39.00 

37.00 

2  by  12  

43.00 

41.00 

39  00 

2£,  3,  and  4  inches  (green  only)  

41.00 

NOTE.  —For  each  inch  in  width  over  12  inches  add  $1.  Specified  lengths  $2  extra.  For  selected  slash 
grain  add  $10.  For  vertical  grain  add  $7. 

Foregoing  prices  on  uppers  are  based  on  loading  not  less  than  85  per  cent  10  feet  and  longer;  balance 
shorter,  usual  lengths,  well  proportioned. 

FIR,  COMMON  BOARDS,  SIS  OR  SHIPLAP. 

1  by  2,  6  to  20  feet  mixed  lengths,  SIS $20. 00 

1  by  3,  6  to  20  feet  mixed  lengths,  SIS 20. 00 

Iby  4,  6  to  20  feet  mixed  lengths,  SIS 18.00 

1  by  6,  6  to  20 feet  mixed  lengths,  SIS  or  S.  L 18.50 

1  by  8,  6  to  20  feet  mixed  lengths,  SIS  or  S.  L 19. 50 

1  by  10,  6  to  20  feet  mixed  lengths,  SIS  or  S.  L 19. 50 

1  by  12,  6  to  20 feet  mixed  lengths,  SIS 20. 00 

For  selected  common,  add  $3;  for  D.  and  M.,  add  $1.50;  for  grooved  roofing,  add  $3.  Orders  for  16,  18, 
and  20  feet  only,  add  $2.  Other  orders  for  specified  lengths,  add  $1  to  above  prices.  No.  2  common  boards 
and  shiplap,  $3  less  when  in  stock. 


766 


HISTORY   OF   PRICES   DURING  THE   WAR. 

FIR,  COMMON  DIMENSION,  S1S1E. 


6  feet. 

8,  12,  and 
14  feet. 

16  feet. 

9,  10,  18, 
and  20 
feet. 

22  and  24 
feet. 

26  to  32 
feet. 

2  by  3  and  2  by  4  .     . 

$17  50 

$18  50 

$19  50 

$20  50 

$21  50 

$23  50 

2  by  6  and  2  by  8.  .  . 

17.50 

18.00 

19.00 

19  50 

20  50 

22  00 

2  by  10  

18.00 

19  00 

19  50 

20  00 

21  00 

23  00 

2  by  12 

18  50 

19  50 

20  00 

20  50 

21  50 

23  50 

2  by  14  

21  00 

21  00 

22  00 

23  00 

25  00 

2  by  16. 

22  00 

22  00 

23  00 

24  00 

26  00 

2  by  18 

24  00 

24  00 

25  go 

26  00 

90   no 

2  by  20...     . 

26  00 

26  00 

97  00 

28  00 

30  00 

Add  50  cents  for  every  2  feet  over  32  feet  long  up  to  40  feet.  For  select  comnrtm,  add  $3.  SlE  or  rough, 
same  mill  base  as  dressed.  For  2  by  4,  2  by  6,  or  2  by  8  D.  and  M.  or  shiplap,  add  to  S1S1E,  $1.50.  Hem- 
lock permitted  in  2  by  4  and  2  by  6. 

FIR  COMMON  PLANK  AND  SMALL  TIMBERS  S1S1E  OR  S4S. 


8,  12,  14, 
and  16 
feet. 

9,10,  18, 
and  20 
feet. 

22  and 
24  feet. 

26  to 
32  feet. 

2  by  3,  and  3  by  4  .  . 

$21  00 

S21  50 

$22  50 

S24  50 

3  by  6... 

22.00 

22.50 

23.50 

25.50 

3  by  8 

22  00 

22  50 

23  50 

25  50 

4  by  4  4  by  6.  4  by  8 

22  50 

23  50 

24  50 

26  50 

6  by  6  to  8  bv  8.. 

22  00 

23  00 

24  00 

26  00 

3  by  10  and  3  by  12  

23.50 

24.50 

25.50 

27.50 

24  00 

25  00 

26  00 

28  00 

3  by  16...                                            .*.. 

25.00 

26.00 

27.00 

29  00 

3  by  18 

27  00 

28  00 

29  00 

31  00 

3  by  20. 

29.00 

30.00 

31.00 

33.  00 

4  by  10  and  4  by  12  

23.50 

24.50 

25.50 

27.50 

4  by  14.                 ... 

24.50 

25.50 

26.50 

•     28.50 

4  by  16 

25  50 

26  50 

27  50 

29  50 

4  bv  18. 

27.00 

28.00 

29.00 

31.00 

4  by  20 

29  00 

30.00 

31  00 

33  00 

Add  50  cents  for  every  2  feet  over  32  feet  long  up  to  40  feet. 

For  selected  common  add  $3  SlE  or  rough  same  mill  base  as  dressed. 

FIR  TIMBERS  SINGLE  CARLOAD  LENGTHS. 


32  feet  and  under. 

34  to  40  feet. 

Rough. 

S1S1E 
or  S4S. 

Rough. 

S1S1E 
or  S4S. 

6  by  10  to  8  by  12.  . 

$25.00 
25.50 
27.00 
28.00 
29.50 
32.50 
36.00 
25.00 
25.50 
30.00 
32.00 
35.00 
2'i.  .50 
28.50 
29.50 
31.50 
35.00 

$26.00 
27.50 
29.  50 
31.00 
32.50 
36.00 
40.00 
26.00 
28.00 
33.  SO' 
35.75 
39.00 
30.00 
32.50 
34.00 
36.50 
40.50 

$27.00 
27.50 
29.00 
31.00 
32.50 
36.50 
42.00 
27.00 
27.50 
33.00 
3ii.  00 
39.50 
28.50 
30.50 
32.50 
35.50 
39.50 

$28.50 
30.00 
32.00 
34.50 
36.00 
40.50 
46.50 
29.50 
30.  ,50 
36.00 
40.25 
44.00 
32.50 
35.00 
36.50 
41.00 
45.50 

6  by  14  to  8  by  14  

6  by  16  to  10  by  16 

6  by  18  to  10  by  18 

6  by  20  to  8  by  20 

6by22to8by22  

6  by  24  to  8  by  24 

10  by  10  to  12  by  12... 

10  by  14  to  14  by  14  

10  by  20  to  12  by  20  .. 

10  by  22  to  12  by  22.  

10  by  24  to  12  by  24.  . 

12  by  16  to  16  by  16  

12  by  IS  to  18  by  18 

14  by  20  to  20  by  20  

14  by  22  to  22  by  22 

14  by  24  to  24  by  24 

GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 
FIR  TIMBERS  REQUIRING  TWO  OR  MORE  CARS. 


767 


42  to  44  feet. 

46  to  50  feet. 

52  to  54  feet, 

56  to  60  feet. 

Rough. 

S1S1E 
or  S4S. 

Rough. 

S1S1E 
or  S4S. 

Rough. 

S1S1E 
or  S4S. 

Rough. 

S1S1E 
orS4S. 

6  by  6  to  8  by  12 

829.  50 
30.00 
31.50 
34.00 
35.50 
39.50 
45.00 
29.50 
30.00 
36.00 
39.00 
42.50 
31.00 
33.50 
35.50 
38.50 
42.50 

$31.  25 
32.75 
34.75 
37.75 
39.25 
43.75 
49.75 
32.25 
33.25 
40.25 
43.50 
47.25 
35.25 
38.25 
40.75 
44.25 
48.75 

$31.75 
32.25 
33.75 
37.00 
38.50 
42.50 
48.00 
31.75 
32.25 
39.00 
42.00 
45.50 
33.25 
36.50 
38.50 
41.50 
45.  50 

$33.75 
35.25 
37.25 
41.00 
42.50 
47.00 
53.00 
34.75 
35.75 
43.50 
46.75 
50.50 
37.75 
41.50 
44.00 
47.50 
52.00 

$33.75 
34.25 
35.75 
40.00 
41.50 
45.50 

$36.00 
37.50 
39.50 
44.25 
45.75 
50.25 

$36.75 
37.  25 
38.75 
44.50 
46.00 
50.00 

$39.  25 
40.75 
42.75 
49.00 
50.50 
55.00 

6  by  14  to  8  by  14 

6  by  16  to  10  by  16          

6  by  18  to  10  by  18 

6  by  20  to  8  by  20 

6  by  22  to  8  by  22                

6  by  24  to  8  by  24 

10  by  10  to  12*by  12      

33.75 
34.25 
42.00 
45.00 
48.50 
35.25 
39.50 
41.50 
44.50 
48.50 

37.00 
38.00 
46.75 
50.00 
53.75 
40.00 
44.75 
47.25 
50.75 
55.25 

36.75 
37.25 
46.50 
49.50 
53.00 
38.25 
44.00 
46.00 
49.00 
53.00 

40.25 
41.25 
51.50 
54.75 
58.50 
43.25 
49.50 
52.00 
55.50 
60.00 

10  by  14  to  14  by  14 

10  by  20  to  12  by  20 

10  by  22  to  12  by  22  

10  by  24  to  12  by  24 

12  by  16  to  16  by  16      

12  by  18  to  18  by  18 

14  by  20  to  20  by  20      

14  by  22  to  22  by  22             . 

14  by  24  to  24  by  24  

For  odd  or  fractional  thicknesses  add  to  next  less  thickness  50  cents.  Odd  or  fractional  length  timbers 
ordered  shall  be  counted  as  of  next  longer  even  length.  For  odd  or  fractional  widths  add  to  next  less  width 
$1.  For  select  common  add  $3.  For  price  on  lengths  longer  than  60  feet  add  $11  per  thousand  to  f.  o.  b. 
mill  price  as  contained  in  west  coast  price  list  of  May  1, 1915. 

Inspection  at  mill.  Grades  in  accordance  with  West  Coast  Lumberman's  Association  grading  rules, 
rail  A  list  issued  January  1, 1917. 

GOVERNMENT  PRICE  LIST  F.  O.  B.  MILL,  COVERING  DOUGLAS  FIR  FOR  RAILROAD 
AND  GAR  MATERIAL,  AS  APPROVED  BY  DIRECTOR  OF  LUMBER,  OCTOBER  12, 1918. 


0) 

Cross- 
ties. 

(l) 

Bridge 
ties 
surfaced. 

6  by  8 

$19  00 

6  by  8 

$20  00 

7  by  8 

20  00 

7  by  8  and  8  by  8 

21  00 

7  br9 

21.00 

22  00 

For  switch  ties  add  $1.50  per  1,000  to  crosstie  prices. 


Bridge  stringers. 

Common 
rough. 

Surfaced. 

Select 
common. 

Select 
common, 
surfaced. 

6  by  16  to  10  by  16-32  and  under 

$27  00 

$2,9  50 

$30  00 

$32  50 

6  by  18  to  10  by  18  and  under     .                    ..        

28.00 

31.00 

31  00 

34  00 

6  by  20  to  8  by  20  and  under 

29  50 

32  50 

32  50 

35  50 

6  by  22  to  8  by  22  and  under  

32.50 

36.00 

35.50 

39  00 

6  by  24  to  8  by  24  and  under          .                                  .  . 

36.00 

40  00 

39  00 

43  00 

10  by  20  to  12  by  20  and  under  

30.00 

33.50 

33  00 

36  50 

10  by  22  to  12  by  22  and  under 

32.00 

35.75 

35  00 

38  75 

10  by  24  to  12  by  24  and  under 

35  00 

39  00 

38  00 

42  00 

Weight:  Rough,  3,300  pounds;  S1S1E  or  S4S,  3,000  pounds.  For  odd  or  fractional  thickness  add  to  next 
less  thickness  50  cents.  Odd  or  fractional  length  timbers  ordered  shall  be  counted  as  of  next  longer  even 
length.  For  odd  or  fractional  Avidths  add  to  next  less  width  $1 . 

NOTE.— Lengths  34  to  40,  add  regular  timber  list  spread. 


Car  sills. 

34-foot. 

35  to  40 
foot. 

41  to  45 
foot. 

Common  rough 

$29  00 

$31  00 

$36  00 

S4S                                       .  .                

31.00 

33.50 

38.50 

NOTE.— For  select  common  add  $3  per  1,000. 


768  HISTORY    OF   PRICES   DURING   THE   WAR. 

STANDARD  CAR  DECKING  AND  END  LINING  (SURFACED). 


Common. 

Select 
common. 

No.  2  clear 
and  better. 
F.G.K.D. 

No.  2  clear 
and  better, 
V.G.K.D. 

2  by  6  to  2  by  10  1 

$21  00 

§24  00 

$41  00 

$48  00 

23-inch  and  thicker  

44  00 

51  00 

. 50  less  for  rough  stock. 

STANDARD  CAR  FRAMING,  FACIA  AND   RUNNING   BOARD. 


Rough. 

Surfaced. 

Common. 

Select 
common. 

Common. 

Select 
common. 

2  by  12  and  smaller  }-inch  surfacing 

$24.  00 
26.00 

$27.  00 
29.00 

$26.00 
28.00 

'  $29.00 
31.00 

Larger  sizes,  i  inch  surfacing  

INSULATION. 

i  by  4  and  §  by  6,  4  to  20  feet,  No.  1  common,  $15.50  ;  select,  common,  $17.50. 
NOTE. — Surface  measurement  . 

STANDARD  CAR   SIDING. 

1  by  4,  No.  2  and  better,  V.  G.,  K.  D..  SIS,  S2S,  or  worked..                                    _   $44.  00 
1  by  4,  No.  2  and  better,  F.  G.,  SIS,  S2S,  or  worked 34.00 

1  by  6,  No.  2  and  better,  V.  G..  SIS,  S2S,  or  worked. _  46.  00 

1  by  6,  No.  2  and  better,  F.  G.,  SIS,  S2S,  or  worked 35.  50 

NOTE. — Fractional  lengths  shall  be  counted  as  the  next  longer  odd  or  even  foot  in 
length  ;  15  per  cent,  of  No.  3  grade  accumulated  in  manufacturing  $5  per  thousand  less; 
rough  green  stock  $4  less  ;  rough  dry  stock  $2  less. 

STANDARD  CAR  LINING  AND  ROOFING. 

1  by  4,  No.  2  and  better,  S.  G.  (SIS,  S2S,  or  worked),  random  lengths $34.00 

1  by  4,  No.  2  and  better,  S.  G.   (SIS,  S2S,  or  worked),  specified 36.00 

1  by  6,  No.  2  and  better,  S.  G.  (SIS,  S2S,  or  worked),  random  lengths 35.  50 

1  by  6,  No.  2  and  better   (SIS,  S2S,  or  worked),  specified 37.50 

14  and  1|  by  8,  No.  2  and  better,  S.  G.   (SIS,  S2S,  or  worked),  random  lengths—     43.00 
1J  and  1|  by  8,  No.  2  and  better,  S.  G.   (SIS,  S2S,  or  worked),  specified 45.00 

NOTE. — No.  3  grade  accumulated  in  manufacture  at  $5  per  thousand  less  ;  rough  green 
stock  $4  less  ;  rough  dry  stock  $2  less  ;  V.  G.  add  $9. 

HORIZONTAL  SHEATHING  (KILN-DRIED  WORKED). 

2  by  4,  No.  2  and  better,  S.  G _  $42.50 

2  by  6,  No.  2  and  better,  S.  G 43.  50 

NOTE. — V.  G.  add  $7  ;  rough  green  stock  $4  less  ;  rough  dry  stock  $2  less. 

Timbers,  boards,  dimensions,  shiplap,  and  other  miscellaneous  requirements  at  prices 
approved  for  Government  purchases.  All  grading  and  surfacing  to  be  in  accordance  with 
West  Coast  Lumbermen's  Association  standard  classification  grading  and  dressing  rules, 
January  1,  1917,  for  general  requirements.  August  1,  1917,  for  car  material. 

MAHOGANY  LUMBER. 

An  informal  agreement  as  to.  a  fair  and  reasonable  price  for  mahogany  lum- 
ber, propeller  quality,  was  entered  into  in  March,  1918,  between  mahogany 
producers  and  the  bureau  of  aircraft  production.  The  price  agreed  upon  was 
$350  per  thousand  feet.  It  remained  unchanged  throughout  the  period  of  the 
war. 

NEW  ENGLAND  SPRUCE. 

An  average  price  of  $33  per  thousand  was  reached  by  agreement  between 
the  manufacturers  of  New  England  spruce  and  the  lumber  committee  of  the 
Council  of  National  Defense  in  June,  1917. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


769 


A  new  schedule,  approved  by  the  price-fixing  committee  on  April  12,  1918, 
showed  an  increase  to  about  $40  per  thousand  board  feet.1 

The  Federal  Trade  Commission  investigated  costs  in  the  industry,  and  a  new 
price  list  was  issued  July  17,  1918.  This  applied  to  all  purchasers  of  spruce 
lumber  and  showed  another  increase  of  $8  per  thousand  board  feet  on  all  items. 

The  schedules  of  July,  1918,  were  effective  until  November  1,  1918,  and  were 
then  extended  to  December  1,  1918,  when  control  ceased. 

(Apr.  12,  1918,  to  July  1,  1918.) 

Prices  quoted  in  the  schedule  below  are  on  United  States  Government  orders 
for  merchantable  spruce  lumber  in  orders  of  substantial  size,  for  carload  lot 
shipments.  Prices  are  effective  from  April  12,  1918,  to  July  1,  1918.  For  further 
information  inquire  of  New  England  spruce  emergency  bureau,  131  State  Street, 
Boston,  Mass. 


Sizes. 

Lengths  (feet). 

Prices 
(per  M 
feet). 

Sizes. 

Lengths  (feet). 

Prices 
(perM 
feet). 

2by2  

8-20  feet. 

$40.00 
40.00 
40.00 
40.00 
40.00 
40.00 
40.00 
45.00 
50.00 
52.  00 
40.00 
40.00 
40.00 
40.00 
40.00 
45.00 
50.00 
52.00 
40.00 
40.00 
40.00 
40.00 
40.00 
45.00 
50.00 
52.00 
40.00 
40.00 
40.00 
40.00 
45.00 
50.00 
52.00 
40.00 
40.00 
40.00 
45.00 
50.00 
52.00 
40.00 
40.00 
45.00 
50.00 
52.00 
40.00 
45.00 
50.00 
52.00 

1  by  4.  . 

8-20  feet  .  . 
do 

'    $10.00 
40.00 
40.00 
40.00 
40.00 
45.00 
50.00 
55.00 
40.00 
40.00 
40.00 
40.00 
40.00 
45.00 
50.00 
55.00 
35.  00 
35.00 
35.00 
3S.OO 
40.00 

43.00 
45.00 
48.00 
40.00 
40.00 
40.00 
40.00 
40.00 
45.00 
45.00 
45.00 
50.00 
50.00 
50.00 
55.00 
55.00 
55.00 

40.00 
35.00 
38.00 
40.00 

2  by  3  planed.  1  edge 

do    . 

Iby  5 

2  by  4  planed  1  edge  
2by5  

do  

do.. 

1  by  6.  . 

do 

1  by  7 

do 

2  by  6.  . 

do 

1  by  8 

do 

2by7  

.     .do.. 

1  by  9 

do 

2by8... 

do. 

1  by  10 

do 

2by9  

...do... 

1  by  12 

do 

2bv  10  

do. 

1}  or  1J  by  4 

do 

2  by  12.  . 

do 

do 

3  by  4  planed  1  edge  
3  by  5  

do  

do. 

J  or  1J  by  6  

..     .do.. 

:  or  li  by  7 

do 

3  by  6.  . 

do 

do 

3  by  7  

do.. 

i  or  1  J  by  9 

do 

3by8.  . 

do 

or  1  J  by  10 

do 

3by9  

do... 

11  or  H  by  12 

do 

3  by  10  

do.  . 

2  by  2 

Random  lengths 
do 

3  by  12  

...do... 

2by3.  . 

4  by  4  

do... 

2  by  4 

do 

4  by  5.. 

do. 

3  by  4  or  4  by  4 

do 

4  by  6  

...do.'... 

All    other    8-inch  and 
under  sizes. 
2  by  9 

do 

4  by  7 

do 

do 

4  by  8.  . 

do 

4  by  9  

...do  

2  by  10 

do 

4  by  10  

do. 

2  by  12 

do 

4by  12  

...do... 

Iby4.. 

do 

5by5  

.   .do.. 

1  by  5. 

do 

5  by  6..   . 

do 

1  by  6 

do 

6  by  7 

do 

1  by  7 

do 

5by  8  

do.  . 

1  by  8 

do 

5  by  9 

do 

1  by  9 

do 

5  by  10  

...do.. 

li  by  9 

do 

5  by  12.  . 

do. 

if  by  Si  I] 

do 

6by  6.  . 

do 

1  by  10 

do 

6by7  

do. 

1J  by  10 

do 

6by8  

...do... 

li  by  10.  . 

do 

6  by  9 

do 

1  by  12 

do 

GbylO  

...do... 

11  by  12.  . 

do.  . 

f>  by  12.  . 

do 

IV  bv  12 

do 

7by7  

.do.. 

1  by  2  or  1  by  3  planed 
1  side. 
1  by  2  or  1  by  3  planed 
1  side. 
1  by  4  to  8  planed  1  side. 

1  by  4  to  8  planed  2  sides, 
planed  1  or  2  sides  and 
matched,  planed, 
matched  and  beaded, 
or  planed  4  sides. 

Any  quantity 
any  length. 
8-20  feet 

7  by  8.  . 

do 

7by  9.  . 

do 

7by  10  

do.. 

Random  lengths 

Random  widths 
and  lengths. 
Random  lengths 

7  by  12.  . 

do. 

8  by  8 

do 

8  by  9.  . 

.do.  . 

8  by  10.  . 

do 

8  by  12 

do 

Where  the  fractional 
part  of  a  foot  is  specified, 
the  stock  is  to  be  figured 
the  next  foot  in  length. 
For  every  2  feet  or 
fraction  over  20  feet  add 
$1  per  M. 

1  Trice  Fixing  Committee  Minute  Book  II,  Apr.  11-12,  1918. 


125547°— 2( 


770  HISTORY   OF   PRICES   DURING   THE   WAR. 

All  prices  in  the  rougji  unless  otherwise  specified  above. 

For  planing  1  side,  add $0.  50 

For  plan-ing  2  sides,  add 1.  00 

For  planing  1,  2  sides  and  matching  or  grooving  and  planing  4  sides,  add 1.  50 

For  beading,  add .  50 

The  above  prices  are  quoted  with  the  understanding  that  the  Government  will  endeavor 
to  give  a  fair  assortment  of  widths  and  lengths  on  their  orders  and  that  we  should  not  bo 
called  upon  to  furnish  all  8-inch,  and  wider  on  any  job  unless  we  furnish  the  narrow 
widths  and  short  lengths  needed  for  same  job. 

Any  order  submitted  not  in  accordance  with  our  interpretation  of  the  above  statement,, 
we  reserve  the  right  to  make  additional  charge,  according  to  manufacturing  and  market 
conditions  at  that  time,  for  furnishing  such  schedules.  If  such  charge  is  not  agreeable 
to  the  Government  cancellation  may  be  made  within  a  reasonable  length  of  time  aftor  noti- 
fication to  the  Government,  say,  10  days. 

These  prices  allow  the  present  rate  of  freight  to  Boston,  Mass.  Thoy  do  not  include 
the  3  per  cent  tax  on  freight  bills.  In  adjustment  of  freight  differentials,  the  Bangor  & 
Aroostock  Railroad  lumber  tariff  to  govern.  All  freight  rates  subject  to  change  in  accord- 
ance with  changes  of  present  railroad  rates. 

Terms  of  settlement :  One  per  cent  discount  for  cash  15  days  from  date  of  shipment, 
eastern  merchantable  inspection  to  govern. 

For  deliveries  other  than  Boston,  add  following  arbitraries  : 

Per  M.  feet. 

Albany,  via  Delaware  &  Hudson $0.  75 

Schenectady,  via  Delaware  &  Hudson .  75 

South  Boston 1.  00 

Philadelphia 

Wilmington 3.75 

Newark 3.  75 

Baltimore 

Bristol,    Pa 3.  75 

Troy,    N.    Y 

Albany  and  Schenectady,  via  New  York  Central 1.  25 

The  prices  quoted  to  remain  in  effect  until  July  1,  1918,  or  such  prior  time  as  the 
Federal  Trade  Commission  have  completed  an  investigation  of  cost  of  manufacturing 
lumber  in  the  New  England  district  and  is  prepared  to  submit  their  findings  to  the  price- 
fixing  committee  of  the  War  Industries  Board,  at  which  time  these  prices  may  be  sub- 
ject to  revision. 

(July  19,  1918.) 

After  considering  the  information  submitted  by  tlie  Federal  Trade  Commis- 
sion as  to  the  cost  of  manufacturing  New  England  spruce  lumber,  and  the  infor- 
mation submitted  by  the  representatives  of  the  manufacturers  thereof  at  the 
hearings  held  on  the  18th  of  July,  1918,  at  which  their  request  for  a  readjust- 
ment of  prices  on  their  products  was  heard,  the  price-fixing  committee  appointed 
by  the  President  has  determined,  by  agreement  with  the  said  representatives  of 
the  manufacturers  of  New  England  spruce  lumber,  upon  the  following  maximum 
prices  for  such  lumber.  These  maximum  prices  shall  not  be  exceeded  on  any 
sales  and  contracts  for  sale  (for  mill  shipment)  made  by  the  manufacturer, 
dealer,  or  other  person  during  a  period  beginning  midnight  July  19,  1918,  and 
ending  midnight  November  1,  1918,  to  the  Government,  to  the  Governments  of 
the  nations  associated  with  us  in  the  present  war,  to  the  railroads,  or  to 
such  others  as  customarily  purchase  lumber  for  mill  shipment,  whether  by  rail 
or  by  water. 

The  prices  of  all  New  England  spruce  lumber  in  the  States  of  Maine,  New 
Hampshire,  Vermont,  and  Massachusetts  shall  not  exceed  the  item  prices 
named  in  attached  list.  These  prices  are  for  New  England  spruce  lumber  deliv- 
ered (freight  allowed)  to  Boston,  Mass.  They  do  not  include  war  tax  on 
freight  bills.  For  shipments  to  other  destination  points,  freight  adjustments 
will  be  governed  by  differentials  shown  in  Bangor  &  Aroostook  Railway  lumber 
tariff  on  basis  of  3,000  pounds  weight  to  1,000  feet  of  lumber. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


771 


Prices  oil  items  not  covered  by  above  list  shall  be  priced  on  basis  of  nearest 
comparable  item. 

The  usual  trade  practices  shall  continue,  including  cash  discount  of  1  per  cent 
in  15  days  or  30  days  net. 

Contracts  for  the  sale  of  lumber  entered  into  in  good  faith  prior  to  midnight 
July  19,  1918,  and  enforcible  at  law,  will  be  performed  in  accordance  with  their 
terms,  subject,  of  course,  to  orders  received  from  the  Government  which  may 
require  priority. 

It  is  imperative  that  with  the  least  possible  disruption  of  the  industry  the 
vast  war  needs  of  the  Government,  both  direct  and  indirect,  for  New  England 
spruce  lumber  be  supplied  on  a  fair  basis,  that  an  adequate  supply  and  equitable 
distribution  thereof  be  assured  for  essential  commercial  needs,  that  the  move- 
ment thereof  be  facilitated,  and  that  injurious  speculation  therein  be  prevented. 
Therefore  the  procedure  outlined  below,  by  agreement  with  the  representatives 
of  the  manufacturers  of  New  England  spruce  lumber,  has  been  adopted  for  a 
period  beginning  midnight  July  19,  1918,  and  ending  midnight  November  1,  1918. 

The  procedure  is  that  each  manufacturer  of  New  England  spruce  lumber 
shall— 

(1)  Make  contracts  and  accept  orders  for  his  product  at  prices  not  in  excess 
of  the  applicable  maximum  prices,  always  subject  to  an  option  at  the  applica- 
ble maximum  prices  in  favor  of  the  United  States  or  the  nominee  of  the  War 
Industries  Board.     Under  this  option,,  which  will  cover  all  New  England  spruce 
lumber  down  to  time  of  actual  delivery  to  the  purchaser,  the  War  Industries 
Board  to  any  extent  required  will  allocate  either  to  the  Government  or  to  other 
essential  users.    Any  balance  not  so  allocated  will  be  released  for  sale  to  com- 
mercial buyers,  but  at  prices  no  greater  than  those  determined  upon  as  above 
set  forth. 

(2)  Comply  with  the  directions  of  the  War  Industries  Board,  as  issued  from 
time  to  time,  with  reference  to  filling  commercial  requirements  in  the  order  of 
their  public  importance  and  to  furnish  such  information  and  making  such  re- 
ports as  may  be  required. 

(3)  Keep  up  to  the  best  of  his  ability  the  production  of  spruce  lumber  so  as 
to  insure  an  adequate  supply  so  long  as  the  war  lasts. 

(4)  Neither  reduce  the  scale  of  wages  now  being  paid  nor  change  funda- 
mental labor  conditions  now  in  force. 

The  Government  will  apportion  the  car  supply  available  for  lumber  and  ar- 
range for  its  transportation,  subject  to  allocation  by  the  War  Industries  Board 
as  aforesaid,  to  the  end  that  injury  to  the  industry  due  to  abnormal  war-time 
conditions  be  neutralized  so  far  as  may  be. 

Foreign  trade,  except  to  the  governments  of  nations  associated  with  us  in 
the  present  war,  is  not  to  be  affected  by  this  ruling. 

(July  19,  1918.) 

Maximum  prices  on  New  England  merchantable  spruce  lumber  delivered 
(freight  allowed)  to  Boston,  Mass.  They  do  not  include  war  tax  on  freight 
bills.  For  shipments  to  other  destination  points  freight  adjustments  will  be 
governed  by  differentials  shown  in  Bangor  &  Aroostook  Railroad  lumber 
tariff  on  basis  of  3,000  pounds  weight  to  1,000  feet  of  lumber.  Effective  mid- 
night July  19,  1918,  to  and  including  November  1,  1918. 

DIMENSION. 
[Specified  lengths   20  feet  and  under.] 


Sizes. 

Prices. 

Sizes. 

Prices. 

1  bv  2  DlS  to 

$48  00 

Iby9                    .                          

S53.  00 

x  inch 

48  00 

1  by  10 

58  00 

1  by  4 

48  00 

Ibyl2      

60.00 

1  by  5 

48  00 

li  or  1J  by  4       

48.00 

1  by  6 

48.00 

1J  or  1J  by  5  

48.00 

1  by  7 

48.00 

11  er  1  \  by  6  

48.00 

Ibv8... 

48.00 

Hor  Hby7  

48.00 

772 


HISTORY   OF  PRICES   DURING   THE   WAR. 
DIMENSION— Continued. 


Sizes. 

Prices. 

Sizes. 

Prices. 

IJor  IJbyS  

$48  00 

4  by  8 

$48  00 

1J  or  if  by  9  

.53  00 

4  by  9 

53  00 

l|or  1|  bv  10  

58.00 

4  by  10 

58  00 

IJor  Hby  12  

60  00 

4  by  12 

60  00 

2by2  

48  00 

5  by  5 

48  00 

2  by  3,  DIE  to  2|  inches  

48  00 

5  by  6 

48  00 

2  by  4,  DIE  to  31  inches  

48.00 

5  by  7  

48  00 

2  bv  5 

48  00 

5  by  8 

48  00 

2  by  6.  .. 

48  00 

5  by  9 

53  00 

2by7  

48  00 

5  by  10 

58  00 

2  by  8 

48  00 

5  by  12 

fiO  (ifl 

2  by  9  

53  00 

6  by  6 

48  00 

2  by  10 

58  00 

6  by  7 

40  fin 

2  by  12  

60  00 

6  by  8 

48  00 

3  by  4,  DIE  to  3|-  inches  

48.00 

6  by  9 

53  00 

3  by  5 

48  00 

6  by  10 

3  by  6  .. 

48  00 

6  by  12 

60  00 

3  by  7  

48.00 

7  by  7 

48  00 

3  by  8.. 

48  00 

7  by  8 

48  00 

3  by  9 

53  00 

7  by  9 

KQ  on 

3bylO  

58  00 

7  by  10 

58  00 

3  by  12 

60  00 

7  by  12 

60  00 

4by4  

48  00 

8  by  8 

48  00 

4  by  5 

48  00 

8  by  9 

53  00 

4  by  6 

48  00 

8  by  10 

58  00 

4  by  7  .. 

48  00 

8  by  12 

60  00 

All  above  prices  are  for  rough  lumber  unless  otherwise  specified. 

Where  the  fractional  part  of  a  foot  is  specified,  the  stock  is  to  be  figured  the  next  foot  in  length. 

For  every  two  feet  or  fraction  over  20  feet  add  $1  per  thousand. 


RANDOM   LENGTHS. 


Sizes. 

Prices. 

Sizes. 

Prices. 

by  2, 

feS 

DlS  to  finch  

$38.00 
.   38.00 
42.00 
42.00 
45.00 
45.00 
45.00 
50.00 
55.00 
59.00 
45.00 
45.00 
45.00 
45.00 
45.00 
50.00 
55.00 
59.00 

2  by  2  

$36.  50 
36.50 
38.00 
38.00 
38.00 
38.00 
43.00 
45.00 
50.00 
55.00 
40.00 
45.00 
50.00 
55.00 
40.00 
45.00 
50.00 
55.00 

DlS  to  finch. 

2  by  3  DIE  to  2|  inches 

2  by  4  DIE  to  3|  inches 

by  5 

2  by  5* 

by  6 

2  by  6 

by  7 

2  by  7 

by  8 

2  by  8 

by  9 

2  by  9 

by  10 
by  12 
orli 

or  1^ 
orli 
or  1= 
orli 
or  li 
or  1^ 
or  l\ 

2  by  10 

2  by  12  

by  4 

3  by  4  DIE  to  3?  inches 

bv5... 

by  6 

3  by  10 

by  7 

3  by  12 

by8  

4  by  4 

by  9 

4  by  9 

by  10  

4  by  10 

by  12 

4  by  12 

All  8  inches  and  under  sizes,  random  lengths,  including  timber,  not  specified  above,  $43. 
All  above  prices  are  for  rough  lumber  unless  otherwise  specified. 

For  planing  1  side  add per  M . .  $0.  .50 

For  planing  2  sides  add do 1.  00 

For  planing  1  or  2  sides  and  matching  or  grooving  add do 1. 50 

For  beading,  extra do 50 

For  planing  4  sides  add do 1. 50 

1  by  4  to  8,  planed  1  side,  random  widths  and  lengths 41. 00 

1  by  5  and  up,  planed  and  matched,  random  widths  and  lengths 43. 50 

1  by  5  and  up,  planed  and  matched,  random  widths,  all  even  lengths,  10  to  18  feet 47. 00 

Shiplap  5,  6,  and  7  inches,  random  lengths 46. 00 

Shiplap  8  inches,  random  lengths 48.00 

Prices  on  items  not  covered  by  above  list  shall  be  priced  on  basis  of  nearest  com- 
parable item. 

Terms  of  settlement :  One  per  cent  discount  for  cash  within  15  days  or  SO  days  net 
from  date  of  shipment ;  eastern  merchantable  inspection  to  govern. 

All  freight  rates  subject  to  change  up  or  down  according  to  any  changes  by  railroads 
in  present  rates. 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES.  773 


Sizes. 

Lengths  (any  quantity  any  length). 

Prices 
(perM 
feet). 

1  by  2  or  1  by  3  

Planed  1  side,  8  to  20  feet 

(40 

Do  

Planed  random  lengths 

35 

1  by  4  to  8.  . 

Planed  random  widths  and  lengths 

38 

I  Planed  2  sides  

Bo  

•{  Planed  1  or  2  sides  and  matched,  planed,  matched  and  beaded 

[    or  planed  4  sides  random  lengths 

40 

Where  the  fractional  part  of  a  foot  is  specified  the  stock  is  to  be  figured  the  next  foot 
in  length. 

For  every  2  feet  or  fraction  over  20  feet  add  $1  per  thousand. 

The  above  prices  are  quoted  with  the  understanding  that  the  Government  will 
endeavor  to  give  a  fair  assortment  of  widths  and  lengths  on  their  orders  and  that  we 
should  not  be  called  upon  to  furnish  all  8-inch  and  wider  on  any  job  unless  we  furnish 
the  narrow  widths  and  short  lengths  needed  for  same  job. 

On  any  order  submitted  not  in  accordance  with  our  interpretation  of  the  above  state- 
ment we  reserve  the  right  to  make  additional  charge,  according  to  manufacturing  and 
market  conditions  at  that  time,  for  furnishing  such  schedules.  If  such  charge  is  not 
agreeable  to  the  Government,  cancellation  may  be  made  within  a  reasonable  length  of  time 
after  notification  to  the  Government,  say  10  days. 

These  prices  allow  the  present  rate  of  freight  to  Boston,  Mass.  They  do  not  include 
the  3  per  cent  tax  on  freight  bills.  In  adjustment  of  freight  differentials  the  Bangor  & 
Aroostook  Railroad  lumber  tariff  to  govern. 

Terms  of  settlement :  One  per  cent  discount  for  cash  15  days  from  date  of  shipment, 
eastern  merchantable  inspection  to  govern. 

For  deliveries  other  than  Boston  add  following  arbitraries  : 

Per  thousand 
feet. 

Albany  via  Delaware  &  Hudson $0.75 

Schenectady  via  Delaware  &  Hudson . .  75 

South    Boston 1  00 

Philadelphia   3. 75 

Wilmington 3.  75 

Newark * . 3.  75 

Baltimore >___ , 3.  75 

Bristol,    Pa 3.75 

Troy,  N.  Y .25 

Albany  and  Schenectady  via  New  York  Central 1.  25 

Add  25  cents  per  thousand  right  through  to  above  prices,  occasioned  by  advance  in 
freight  rate  of  1  cent  per  hundredweight,  Bangor  £  Aroostook  Railroad,  supplement 
No.  7  to  I.  C.  C.  No.  1133,  effective  April  20,  1918.  All  prices  in  the  rough  unless 
otherwise  specified  above. 

Per  thousand 
feet. 

For  planing  1  side,  add $0.  50 

For  planing  2  sides,  add 1.  00 

For  planing  1,  2  sides,  and  matching  or  grooving  and  planing  4  sides,  add 1.  50 

For  beading,  add _ .50 

NORTH  CAROLINA  PINE. 

The  first  price  schedules  for  North  Carolina  pine  were  those  made  by 
informal  agreement  with  the  North  Carolina  pine  emergency  bureau.  They 
were  prices  to  the  Government  only  and  were  effective  from  April  8,  1918,  to 
June  5,  1918. 

On  June  28,  1918,  the  price-fixing  committee  announced  a  slight  advance  in 
price,  showing  an  increase  of  $1  per  thousand  on  No.  4  flooring  and  $2  per 
thousand  on  No.  4  ceiling  and  partition,  the  basic  price  being  $29.50.  These 
prices  were  effective  until  September  30*  1918. 

On  October  1,  1918,  the  existing  schedules  were  extended  to  December  31, 
1918,  when  control  ended. 


774 


HISTORY   OF  PRICES   DURING   THE   WAR. 


(Apr.  8  to  June  5,  1918.) 
[All  prices  f.  o.  b.  Norfolk  or  Richmond  (Virginia  gates).] 


Width  and  lengths.1 


2  by  2, 
2  by  2, 
2  by  2, 
2  by  2, 
2  by  2, 
2  by  2, 
2  by  2, 
2  by  2, 
2  by  3, 
2  by  3, 
2  by  3, 
2  by  3, 
2  by  3, 
2  by  3, 
2  by  3, 
2  by  3, 
2  by  4, 
2  by  4, 
2  by  4, 
2  by  4, 
2  by  4, 
2  by  4, 
2  by  4, 
2  by  4, 
2  by  6, 
2  by  6, 
2  by  6. 
2  by  6, 
2  by  6 
2  by  6, 
2  by  6, 
2  by  6, 


10  feet . 
12  feet . 
14  feet. 
16  feet . 
18  feet. 
20  feet . 
22  feet. 
24  feet , 
10  feet . 
12  feet . 
14  feet . 
16  feet . 
18  feet . 
20  feet . 
22  feet. 
24  feet . 
10  feet . 
12  feet . 
14  feet. 
16  feet. 
18  feet. 
20  feet . 
22  feet . 
24  feet. 
10  feet . 
12  feet . 
14  feet. 
16  feet. 
18  feet . 
20  feet. 
22  feet . 
24  feet . 


Price. 


$30.00 
28.00 
28.00 
28.00 
30.00 
30.00 
31.50 
31.50 
27.50 
26.50 
26.50 
26.50 
27. 50 
27.50 
29.00 
29.00 
29.00 
27.00 
27.00 
27.00 
29.00 
29.00 
30.50 
30.50 
26. 50 
25.  50 
25.50 
25.50 
26.50 
26.50 
28.00 
28.00 


Width  and  lengths.1 


2  by  8, 10  feet 

2  by  8, 12  feet 

2  by  8, 14  feet 

2  by  8, 16  feet 

2  by  8, 18  feet 

2  by  8,  20  feet 

2  by  8,  22  feet 

2  by  8,  24  feet 

2  by  10, 10  feet 

2  by  10, 12  feet 

2  by  10, 14  feet 

2  by  10, 16  feet 

2  by  10, 18  feet 

2  by  10,  20  feet 

2  by  10, 22  feet 

2  by  10,  24  feet 

2  by  12, 10  feet 

2  by  12, 12  feet 

2  by  12, 14  feet 

2  by  12, 16  feet 

2  by  12, 18  feet 

2  by  12,  20  feet 

2  by  12,  22  feet 

2  by  12,  24  feet 

2  by  2  random,  8  to  16  feet.. 
2  by  3  random,  8  to  16  feet.. 
2  by  4  random ,  8  to  16  feet. . 
2  by  6  random,  8  to  16  feet.. 
2  by  8  random,  8  to  16  feet.. 
2  by  10  random,  8  to  16  feet. 
2  by  12  random,  8  to  16  feet. 


Price. 


S28.  50 
26.50 

.26.50 
26.50 
28.50 
28.50 
30.00 
30.00 
29.00 
27.00 
27.00 
27.00 
29.00 
29.00 
30.60 
30.50 
30.50 
29.00 
29.00 
29.00 
30.50 
30.50 
32.00 
32.00 
28.00 
26.50 
27.00 
25.  50 
26.50 
27.00 
29.00 


i  Dimensions  S1S1E. 

For  D.  &  M.  or  shiplap  add  $1  per  thousand  feet.     For  S4S  add  50  cents.     For  dimen- 
sions over  24  feet  add  $1  for  each  2  feet  up  to  and  including  32  feet. 

The  above  prices  are  for  simple  working,  BOW  standard  in  manufacture. 

All  above  items  50  cents  per  thousand  less  if  rough. 

1  by  3  random  lengths,  E.  G.  flooring  No.  2 $51.  50 

1  by  4  random  lengths,  B.  G.  flooring  No.  2 49.  50 

1  by  4  random  lengths,  flooring  No.  2 37.  50 

1  by  4  random  lengths,  flooring  No.  3 34.  50 

1  by  4  random  lengths,  flooring  No.  4 26.  50 

1  by  6  random  lengths,  flooring  No.  2 40.  00 

1  by  6  random  lengths,  flooring  No.  3 35.  00 

1  by  6  random  lengths,  flooring  No.  4 27.  50 

1  by  3  to  6  inches,  random  lengths,  flooring  No.  4 27.  00 

1  by  4  to  6  inches,  random  lengths,  flooring  No.  4 '. 27.  00 

i  by  4  random  lengths,  ceiling  No.  2 35.  50 

i  by  4  random  lengths,  ceiling  No.  3 32.  50 

i  by  4  random  lengths,  ceiling  No.  4 25.  50 

I  by  4  random  lengths,  ceiling  No.  2 38.  50 

1  by  4  random  lengths,  ceiling  No.  3 35.  00 

1  by  4  random  lengths,  ceiling  No.  4 26.  50 

1  by  6  random  lengths,  drop  siding  No.  2 38.  50 

1  by  6  random  lengths,  drop  siding  No.  3_ 34.  50 

1  bv  6  random  lengths',  drop  siding  No.  4 28.  50 

Width  and  length.                                                        Description.  Price. 

1  by  4,  random  lengths !  Finish,  No.  2 $39.   o 

1  by  6,  random  lengths do 40. 50 

1  by  8,  random  lengths I do 40. 50 

1  by  10,  random  lengths ! do 41. 50 

1  by  12,  random  lengths < do 42. 50 

1  by  4  to  12,  random  lengths do 40.50 

1  by  4,  random  lengths I  Finish,  "  C  "  or  No.  3 35. 50 

1  by  6  and  8,  random  lengths ' do 

1  by  1 0,  random  lengths i do 39. 00 

1  by  12,  random  lengths i . . .  .^do 39. 50 

1  by  4  to  12,  random  lengths [.'. .  .~7cto 37. 50 

For  specified  lengths- of  finish  add  SI  per  M  feet.    For  i 
S4S  add  50  cents;  if  rough  deduct  50  cents. 

1  by  2,  random  lengths SIS  or  S2S,  No.  3 

1  by  3,  random  lengths do 

1  by  4,  random  lengths I do 30.50 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


775 


Width  and  length. 

Description. 

Price. 

1  by  6,  random  lengths  

SIS  or  S2S,  No.  3  .. 

$31.50 
31.50 
31.50 
34.50 
26.50 
27.50 
25.50 
26.50 
27.50 
27.50 
29.50 
27.50 

45.50 
47.50 
45.50 
47.50 
22.50 
23.00 
23.50 
23.50 
24.00 
23.00 

1  by  8'  random  lengths 

.do. 

1  by  10  random  lengths 

do 

1  by  12,  random  lengths. 

...do  

1  by  2,  random  lengths 

SIS  or  S2S,  No.  4 

1  by  3'  random  lengths 

do 

do 

1  by  6,  random  lengths 

...do... 

1  by  8  randomlengths 

do  

do 

1  by  12  randomlengths 

do    ... 

do 

For  specified  lengths  of  1  inch.  No.  3  and  No.  4,  add 
50  cents,  except  16-foot  add  $1  ;  for  D.  &  M.and  shiplap 
add  50  cents;  if  S4S  add  50  cents. 
I1  by  4  to  10  inches  10  to  16  feet 

S2S  No.  2  

H  by  4  £Q  12irches  10  to  16  feet 

do 

I1  by  4  to  lOinches'lOto  16  feet 

do      

1-i  by  12  inches  10  to  16  feet 

.do  

l~by  4  randomlengths 

SIS  or  S2S,  culls,  R.Ht  

do 

1  by  8  randomlengths 

do  

do                            ... 

do 

1  by  4  to  12  inches  random  lengths 

do          

Add  50  cents  to  above  if  S4S,  D.  &  M.,  or  shiplap. 
All  above  items  50  cents  less  if  rough. 


Width  and  lengths. 

10  to  20 
feet. 

22  and 
24  feet. 

26  feet. 

28  feet. 

30  feet. 

32  feet. 

3  by  4  and  4  by  4 

$29  50 

$30.  50 

$31.50 

$32.50 

$33.50 

$34.50 

3  by  6  to  8  by  8  

28.50 

29.50 

30.50 

31.50 

32.50 

33.50 

3  by  10  and  4  by  10  . 

32.50 

33.50 

34.50 

35.50 

36.50 

37.50 

5  by  10  to  10  by  10  

31.50 

32.50 

33.  50 

34.50 

35.50 

36.50 

3  by  12  to  5  by  12   

34.50 

35.50 

36.50 

37.50 

38.50 

39.50 

6  by  12  to  12  by  12 

33  50 

34  50 

•35  50 

36  50 

37.50 

38.50 

2byl2to5byl4  

39.50 

40.50 

41.50 

42.50 

43.50 

44.50 

6  by  14  to  8  by  14.    . 

39.00 

40  00 

41.00 

42.00 

43.00 

44.00 

10  by  14  to  14  by  14  

38.50 

39.50 

40.50 

41.50 

42.50 

43.50 

The  above  prices  are  for  short-leaf  dimension. 

For  merchantable  add  $3  per  thousand  for  10  inches  and  under. 

For  merchantable  add  $2  per  thousand  for  12  inches  and  over. 

All  prices  are  based  on  furnishing-  rough. 

For  dressing  3-inch  plank  and  small  timbers  up  to  and  including  6  by  6,  add  50  cents 
per  thousand  feet.  For  S4S  add  $1  per  thousand. 

For  dressing  6  by  8  and  larger,  add  $1  per  thousand  feet. 

For  timbers  over  14  inches,  add  $3  for  each  2  inches  above  14  inches. 

For  timbers  over  32  feet,  add  $1  for  each  foot. 

For  tongue  and  grooved  or  shiplapping  timbers,  add  $2  per  thousand,  3  inches  and 
over. 

For  grooving  timbers  5  inches  thick  or  thicker  for  splines,  add  $5  per  thousand  to  the 
above  dressed  prices. 

For  grooving  timbers,  3  and  4  inches  thick,  for  splines,  add  $3  to  above  dressed  prices. 

For  beveling  and  outgauging,  add  $2  per  thousand  feet. 

All  prices  f.  o.  b.  Norfolk  or  Richmond  (Virginia  gates). 

War  tax  not  to  be  paid  by  shipper. 

NOTE. — Prices  on  all  orders  destined  to  points  south  of  Norfolk  are  to  be  based  on 
Norfolk  list,  with  freight  allowed  from  shipping  point  to  Norfolk. 

(June  28,  1918.) 

After  considering  the  information  submitted  by  the  Federal  Trade  Commis- 
sion as  to  the  cost  of  manufacturing  long  and  short  leaf  pine  lumber  produced 
in  the  States  of  Virginia  and  North  and  South  Carolina  and  the  information 
submitted  by  the  representatives  of  the  manufacturers  thereof  at  the  hearings 
held  on  this  date,  June  28,  1918,  at  which  their  request  for  readjustment  of 
prices  on  their  products  was  heard,  the  price-fixing  committee  appointed  by 
the  President  has  determined,  by  agreement  with  the  said  representatives  of 
the  manufacturers  of  long  and  short  leaf  pine  lumber  in  Virginia  and  North 
and  South  Carolina,  upon  the  following  maximum  prices  for  such  lumber. 


776  HISTORY   OF  PRICES   DURING  THE  WAR. 

These  maximum  prices  shall  not  be  exceeded  on  any  sales  and  contracts  for 
sale  (for  mill  shipment)  made  during  the  period  of  three  months  beginning 
midnight  June  28,  1918,  either  to  the  public,  to  the  Government,  to  Govern- 
ments of  the  nations  associated  with  us  in  the  present  war,  or  to  the  railroads, 
whether  by  rail  or  by  water  shipment. 

Prices  of  all  long  and  short  leaf  pine  lumber  in  the  States  of  Virginia  and 
North  and  South  Carolina  shall  not  exceed  the  item  prices  named  on  attached 
list.  These  prices  are  for  long  and  short  leaf  pine  lumber  delivered  (freight 
allowed)  to  Norfolk,  Richmond,  and  other  Virginia  gateways.  For  shipments 
to  destination  points  north  of  and  beyond  these  gateways  these  prices  are  for 
such  portion  of  freight  allowed  to  destination  points  as  will  equal  shipments 
originating  in  above  gateways.  For  shipments  to  destination  points  south  of 
these  gateways  the  f.  o.  b.  cars  mill  or  f.  o.  b.  vessel,  rail  mill  prices  shall  be 
$2.50  per  thousand  less  on  each  item  than  prices  named  on  attached  list. 

Prices  on  items  not  covered  by  above  list  shall  be  priced  on  basis  of  nearest 
comparable  item. 

The  usual  trade  practices  shall  continue,  including  cash  discounts  to  be 
applied  to  the  United  States  Government  purchases  as  well  as  all  others,  ex- 
cept that  in  commercial  transactions  where  purchasers  do  not  avail  themselves 
of  the  cash  discounts  the  accounts  may  be  converted  into  trade  acceptances 
which  do  not  bear  interest  before  maturity. 

The  custom  of  delivered  prices  of  lumber  to  purchasers'  destination  points 
shall  remain  unchanged. 

Contracts  for  the  sale  of  lumber  entered  into  in  good  faith  prior  to  midnight 
June  28,  1918,  and  enforcible  at  law,  will  be  performed  in  accordance  with 
their  terms,  subject,  of  course,  to  orders  received  from  the  Government  which 
may  require  priority. 

It  is  imperative  that,  with  the  least  possible  disruption  of  the  industry,  the 
vast  war  needs  of  the  Government,  both  direct  and  indirect,  for  long  and  short 
leaf  pine  lumber  from  Virginia  and  North  and  South  Carolina  be  supplied  on 
a  fair  basis,  that  an  adequate  supply  and  equitable  distribution  thereof  be 
assured  for  essential -commercial  needs,  that  the  movement  thereof  be  facili- 
tated, and  that  injurious  speculation  therein  be  prevented.  Therefore  the  pro- 
cedure outlined  below,  by  agreement  with  the  representatives  of  the  manufac- 
turers of  long  and  short  leaf  pine  lumber  from  above-mentioned  States,  has 
been  adopted  for  a  period  of  three  months  beginning  midnight  June  28,  1918. 

The  procedure  is  that  each  manufacturer  of  long  and  short  leaf  pine  lumber 
in  Virginia  and  North  and  South  Carolina  shall — 

(1)  Make  contracts  and  accept  orders  for  his  product  at  prices  not  in  excess 
of  the  applicable  maximum  prices,  always  subject  to  an  option  at  the  appli- 
cable maximum  prices  in  favor  of  the  United  States  or  the  nominee  of  the 
War  Industries  Board.     Under  this  option,  which  will  cover  all  long  and  short 
leaf  pine  lumber  from  above-mentioned  States  down  to  actual  delivery  to  the 
purchaser,  the  War  Industries  Board,  to  any  extent  required,   will  allocate 
either  to  the  Government  or  to   other  essential  users.     Any  balance  not  so 
allocated  will  be  released  for  sale  to  commercial  buyers,  but  at  prices  no  greater 
than  those  determined  upon  as  above  set  forth. 

(2)  Comply  with  the  directions  of  the  War  Industries  Board  as  issued  from 
time  to  time  with  reference  to  filling  commercial  requirements  in  the  order  of 
their  public  importance  and  to  furnishing  such  information  and  making  such 
reports  as  may  be  required. 

(3)  Keep  up  to  the  best  of  his  ability  the  production  of  long  and  short  leaf 
pine  lumber  in  Virginia  and  North  and  South  Carolina,  so  as  to  insure  an  ade- 
quate supply  so  long  as  the  war  lasts. 

(4)  Neither  reduce  the  scale  of  wages  now  being  paid  nor  change  funda- 
mental labor  conditions  now  in  force. 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES. 


777 


The  Government  will  appportion  the  car  supply  available  for  lumber  and 
arrange  for  its  transportation,  subject  to  allocation  by  the  War  Industries 
Board  as  aforesaid,  to  the  end  that  injury  to  the  industry  due  to  abnormal  war- 
time conditions  be  neutralized  so  far  as  may  be. 

Foreign  trade,  except  to  the  Government  of  nations  associated  with  us  in  the 
present  war,  is  not  to  be  affected  by  this  ruling. 

These  prices  are  for  long  and  short  leaf  pine  lumber  delivered  (freight 
allowed)  to  Norfolk,  Richmond,  and  other  Virginia  gateways.  For  shipments 
to  destination  points  north  of  and  beyond  these  gateways  these  prices  are  for 
such  portion  of  freight  allowed  to  destination  points  as  will  equal  shipments 
originating  in  above  gateways.  For  shipments  to  destination  points  south  of 
these  gateways  the  f.  o.  b.  cars  mill  or  f.  o.  b.  vessel  rail  mill  prices  shall  be 
$2.50  per  thousand  less  on  each  item  than  prices  named  on  attached  list. 
Effective  June  28  to  and  including  September  28,  1918. 


No.  1. 

No.  2. 

No.  3. 

No.  4. 

Cull. 

1  by  3  and  Z\  flooring  

$43.00 
42.00 

$41.  00 
40.00 

$36.50 
36.50 
37.00 
37.50 
36.00 
37.50 
37.50 
24.00 
25.50 
28.50 
30.00 

$32.00 
32.00 
33.50 
34.50 
32.00 
32.00 
32.00 
21.00 
22.50 
24.00 
26.00 

'  by  4  and  4  J  flooring  .... 

I  by  5  and  5|  flooring 

1  by  6  flooring  

I  by  2J  to  5-i  flooring    

$20.00 

1  J  by  1\  and  3  flooring 

47.00 
47.00 
27.50 
29.00 
31.50 
34.00 
43.00 
43.00 
44.00 
46.00 
45.00 
30.00 
32.00 

45.00 
45.00 
26.00 
27.50 
30.00 
32.50 
41.00 
41.00 
42.00 
44.00 
42.00 
28.00 
30.00 

IJ  by  3J  and  4  flooring  

|  by  2k  inch  to  3^-inch  ceiling 

v  by  2-V  inch  to  3J-inch  ceiling  

by  2*-  inch  to  3j-inch  ceiling 

and  |f-  inch,  2  J  to  3;j  inch  ceiling     

f  by  2;}  and  3  partition 

37.00 
37.50 
38.00 
37.50 
26.00 
28.00 

34.50 

-f  by  3J,  4,  and  4£  partition  

f  by  5  and  5i  partition  

by  6  inch  drop  or  O   G.  siding 

34.50 
22.00 
24.00 

Bevel  siding  from  1-inch  stock  

Bevel  siding  from  IJ-inch  stock 

Add  $1  per  thousand  feet  for  specified  lengths. 
Deduct  $1  per  thousand  for  air  dried  (Oct.  1,  1918). 

Boards. 

Iby3. 

Iby4. 

Iby6. 

Iby8. 

1  by  10. 

1  by  12. 

1  by  4  to 
12  inches. 

No.  3  SI  or  2S     . 

$36.  00 

$36.  00 

$37.00 

$37.  00 

$37  00 

$40  00 

$37  00 

No  4  SI  cr  2S                    . 

31.50 

31.50 

34.00 

34  00 

35  00 

36  50 

33  50 

Culls  and  red  hearts 

28  50 

28  50 

29  00 

26  00 

Dunnage     .                

20  50 

No.  land  2  bark  strips  and  mis- 
cuts,  SI  or  2S  

34  00 

No.  3  and  4  bark  strips  and  mis- 
cuts,  SI  or  2S... 

24.00 

For  1-inch  Nos.  3  and  4  in  specified  lengths  add  50  cents,  except  16-foot,  add  $1. 

Rough  50  cents  less  than  S2S  ;  S4S,  D.  and  M.,  or  shiplap  add  50  cents  to  S2S  prices. 
For  resawing  add  $1  per  thousand. 

Nos.  1  and  2  bark  strips,  when  worked  to  partition,  add  to  above  S2S  price  $2  per 
thousand  feet. 

Boards,  when  ordered  kiln  dried,  add  $1  per  thousand  feet. 

For  D.  and  M.  beaded,  8  inches  and  wider,  add  $2  to  S2S  price  (Oct.  1,  1918). 


Finish  S2S. 

No.  1. 

No.  2. 

No.  3. 

No.  4. 

1  by  4  to  12  random 

$43  50 

$41  50 

1  by  4  rand'om                                                          .        .        

43.50 

41.50 

1  by  6  random 

44  50 

42  50 

45  50 

43  50 

1  by  10  random 

46.00 

44.00 

1  by  12  random 

47  50 

45  50 

5/4  by  4  to  12,  random  

47.50 

45.50 

$39.00 

$34.50 

5/4  by  6  rand'om 

48.50 

46.50 

39.00 

35.00 

5/4  by  8  random 

49  50 

47  50 

39  00 

35  00 

5/4  by  10,  random                      

50.00 

48.00 

39.00 

36.00 

5/4  by  12  random                                                   ... 

51  50 

49.50 

42.00 

37.50 

6/4  by  4  to  12  random 

48  50 

46  50 

41  00 

35  00 

6/4  by  6,  random  .                

49.50 

47.50 

41.00 

35.50 

f/4  by  8  random 

50.50 

48.50 

41.00 

35.50 

6/4  by  10  random 

51  00 

49  00 

41  00 

36.50 

6/4  by  12,  random... 

54.50 

52.50 

44.00 

38.00 

778 


HISTORY   OF   PRICES   DURING   THE   WAR. 


Finish  S28. 

No.  1. 

No.  2. 

NO.  3. 

No.  4. 

8/4  by  4  to  12,  random.  . 

$49  50 

$47  50 

§41  00 

8/4  by  6,  random  .  .  . 

50  50 

48  50 

41  00 

8/4  by  8  random 

51  50 

49  50 

41  00 

8/4  by  10,  random  

52  00 

50  00 

41  00 



8/4  by  12  random 

53  50 

51  50 

44  00 

Molded  casing  and  base  from  1  by  4,  6  and  8  inch  stock  

50.00 

47.00 

Molded  casing  and  base  from  1  by  5  and  10  inch  stdck  

52.00 

49.00 

Jambs  from  4/4  stock  

50  00 

47  00 

Jambs  from  5/4,  6/4,  and  8/4  stock 

53  00' 

50  00 

The  above  prices  are  foi-  S2Sfinish  ;  for  S4S,  add  50  cents  per  thousand  feet. 

For  specified  lengths,  add  $1  per  thousand  feet ;  for  rough,  deduct  50  cents  per  thou- 
sand feet. 

Moldings,  Ig-inch  width  and  smaller,  52  per  cent  discount;  moldings,  lg  inches  and 
wider,  47  per  cent  discount. 

Laths,  No.  1,  4.75  ;  laths,  No.  2,  $3.75. 


Dimensions. 

10,  12,  14, 
and  16 
feet. 

18  and  20  22  and  24 
feet.           feet. 

Random. 

2  by  2  S1S1E 

$31  00 

S33  00         $34  50 

§30  50 

2  by  3  S1S1E 

29  50 

30  50           32  00 

29  00 

2  by  4  S1S1E 

30  00 

32  00           33  50 

29  50 

2  by  6  S1S1E 

28  50 

29  50           31  00 

28  00 

2  by  8  S1S1E 

29  50 

31  50           33  00 

29  00 

2  by  10  SlSlE 

30  00 

32  00           33  50 

29  50 

2  by  12  S1S1E. 

32  00 

33  50           35  00 

31  50 

Dimension  when  ordered  kiln  dried,  add  $2  per  thousand  feet. 

Dimension  D.  &  M.  or  shiplap,  add  $1  per  thousand  to  S1S1E  prices;  rough,  50  cents 
less  than   S1S1E  prices;    S4S,   add  50  cents  per  thousand  to   S1S1E.  prices. 
For  dimension  over  24  feet,  add  $1  for  each  2  feet  up  to  ?>2  feet. 
For  merchantable  longleaf  10  inches  and  under  wide,  add   $3  per  thousand  foot. 
For  merchantable  longleaf  12  inches  and  over  wide,  add  $2  per  thousand  feet.     (Oct.  1, 

NOTE. — All  lumber  not  over  2  inches  thick  when  ordered  in  odd  or  fractional  lengths  will  be  invoiced 
as  of  next  longer  length  in  multiples  of  2  feet. 


Timbers. 

10  to  20 
feet. 

22  and  24 
feet. 

26  feet. 

23  feet. 

30  feet. 

32  feet. 

3  by  4  and  4  by  4 

$33  00 

$34  00 

$35  00 

§36  00 

$37  00 

$38  00 

3  by  6  to  8  by  8  

32.00 

33.00 

34.00 

35.00 

36.00 

37.00 

3  by  10  to  4  by  10 

36.00 

37  00 

38  00 

39  00 

40  00 

41  00 

5  by  10  to  10  by  10  

35.00 

36.00 

37.00 

38.00 

39.00 

40.00 

3  by  12  to  5  by  12 

38  00 

39  00 

40  00 

41  00 

42  00 

43  oo 

6  by  12  to  12  by  12  

37.  00 

38.00 

39.00 

40.00 

41.00 

42.00 

3  by  14  to  5  by  14 

43  00 

44  00 

45  00 

46  00 

47  00 

48  00 

6  by  14  to  8  by  14  

42.50 

43.50 

44.50 

45.50 

46.50 

47.50 

10  by  14  to  14  by  14 

42  00 

43  00 

44  00 

45  00 

46  00 

47  00 

Add  for  timbers  over  14  inches  $3  for  each  2  inches  over  14  inches. 

Add  for  timbers  over  32  feet  $1  for  each  foot  over  32  feet. 

Prices  above  are  for  short-leaf  dimensions  rough  ;  for  better  qualities  and  various 
working  apply  the  following  differentials  : 

For  long  leaf  No.  1  common  add  $2  per  thousand  feet. 

For  merchantable  10  inches  and  smaller  add  $3  per  thousand  to  No.  1  long-leaf  price. 

For  merchantable  12  inches  and  larger  add  $2  per  thousand  to  No.   1  long-leaf  price. 

For  prime  rule  of  1905  add  $5  to  No.  1  long-leaf  price. 

Add  for  dressing  $1  per  thousand  feet. 

Add  for  T.  &  G.  or  shiplap  $2  per  thousand  feet. 

Add  for  grooving  $3  per  thousand  to  dressed  price  stock  3  and  4  inches  thick. 

'Add  for  grooving  $5  per  thousand  to  dressed  price  stock  5  inches  and  thicker. 

Add  for  bevelling  and  outgauging  $2  per  thousand  feet  to  dressed  prices. 

NOTB. — AH  timber  when  ordered  in  odd  or  fractional  lengths  will  invoice  as  of  next 
longer  length  a  multiple  of  2  feet. 

PENNSYLVANIA  HEMLOCK, 

The  original  price  schedules  for  Pennsylvania  hemlock  were  announced  by 
the  emergency  bureau  on  April  6,  1918,  and  were  approved  by  the  price-fixing 
committee  on  May  8,  1918.  The  base  price  was  $27  per  thousand  board  feet. 
This  base  price  was  increased  on  August  15,  1918,  to  $29  per  thousand,  and  the 
price  lists  rearranged  accordingly. 

On  October  16  revision  was  postponed  and  existing  prices  were  continued  until 
December  20,  1918,  when  all  restrictions  were  removed. 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES. 


779 


(May  8,   1918,  to  Aug.  8,  1918.) 

The  price-fixing  committee  of  the  War  Industries  Board  passed  the  following 
ruling  on  May  8,  1918,  covering  the  maximum  prices  for  mill  shipment  of 
Pennsylvania  hemlock  lumber : 

"  The  price  of  $31  per  thousand  feet  f.  o.  b.  cars  Philadelphia  which  has  been 
in  force  since  April  6,  1918,  shall  be  continued  in  effect  as  the  basic  maximum 
price  of  Pennsylvania  hemlock  lumber  to  all  departments  of  the  Government 
until  August  8,  1918." 

At  the  same  time  the  following  rules  with  reference  to  the  prices  of  No.  1  and 
No.  2  grades  of  Pennsylvania  hemlock  were  promulgated : 

1.  That  the  system  of  delivered  prices  be  discontinued;  and  that  there  be 
substituted  as  basic  maximum  the  price  of  $27  per  thousand  feet  f.  o.  b.  mill, 
with  variations  according  to  the  appended  schedule. 

2.  That  the  entire  stock  and  production  of  Pennsylvania  hemlock,  grades  Nos. 
1  and  2,  will  be  held  available  for  the  direct  and  indirect  needs  of  the  Govern- 
ment in  the  war,  and  will  be  distributed  and  dealt  in  subject  to  the  control 
of  the  War  Industries  Board. 

3.  That  such  of  the  lumber  as,  in  the  judgment  of  the  chief  of  the  lumber  sec- 
tion of  said  board,  can  without  detriment  to   governmental   requirements  bo 
released  for  urgent  commercial  or  other  needs,  may  be  sold  to  car-lot  pur- 
chasers (with  his  consent)  at  prices  which,  per  item,  shall  not  exceed  the  prices 
as  established  by  the  appended  schedule. 

4.  This  arrangement  shall  continue  effective  until  August  8,  1918. 

SCHEDULE  OP  VARIATION  FROM  BASE  OF  $27  PER  M  FEET,  BOARD  MEASURE 

IN  CARLOAD  LOTS. 


NO.    1   SIZES. 

2  by  3: 

10   feet    (ripped   from   2   by  6), 
add $1.  00 

12  and  14  feet,  add 1.  00 

16  feet,  add 3.  00 

18  and  20  feet,  add 5.  50 

2  by  4: 

8  feet,  L.  R.,  deduct 2.  00 

9  feet,  L.  R.,  when  in  stock,  add_     2.  00 

10  feet 

12  feet 

14  feet 

16  feet,  add 3.  00 

18  and  20  feet,  add 4.  50 

22  and  24  feet,  add 5.  50 

2-inch  sizes,  No.  2,  $2  per  M  less 

than  same  size  in  No.  1. 

2  by  G  to  2  by  12  : 

10  feet,  when  in  stock,  add 

12  and  14  feet 

16  feet,  add 1.  50 

18  and  20  feet,  add 3.  50 

22  and  24  feet,  add 5.  50 

26  and  28  feet,  add 6.  50 

30  and  32  feet,  add 7.  50 

34  and  36  feet,  add 9.  50 

38  and  40  feet,  add 11.  50 

3  by  4  to  12  by  12  :  add  50  cents  per  M 

feet  to  price  of  2  by  6  to  2  by  12,   same 

lengths. 


NO.  i  BOARDS. 

1  by  6  : 

10,  12,  and  14  feet 

16  feet,  add 

18  and  20  feet,  add 

1  by  8: 

10,  12,  and  14  feet 

16  feet,  add 

18  aud  20  feet,  add 

1  by  10 : 

10,  12,  and  14  fer-t,  add 

16  feet,  add 

15  aud  20  feet,  add 

1  by  12 : 

12  feet,  add 

10  and  14  feet,  add 

16  feet,  add 

18  and  20  feet,  add 

5/4   and   6/4,   add   $2   to  price  of 
same  width. 


$5.  00 
4.  00 


2.00 
3.  50 

1.  50 
5.  00 
5.  00 

4.50 

2.  00 

6.00 

0.  00 

boards 


NO.   2   BOARDS. 


1  by  6,  8  to  18,  rough  or  SIS,  deduct.  $1.  00 

1  by  8,  8  to  18,  rough  or  SIS 

1  by  10,  8  to  18,  rough  or  SIS,  add-  .  50 
1  by  12,  8  to  18,  rough  or  SIS,  add-  .  5~0 

NO.  3  BOARDS. 

1  by  6  to  12  : 

8  to  18,  rough  or  SIS,  deduct—  $4.  00 

LOG  RUN  BOARDS. 

1  by  4,  8  to  16,  rough  or  SIS,  deduct-  $4.  00 
1  by  6  to  12,  8,  rough  or  SIS,  deduct  _  3  00 
1  by  6  to  12,  10,  SIS,  deduct 

DRESSED  AND    MATCHED  BOARDS. 

1  by  4,  8  to  16  feet,  No.  1    (25  per 

cent  10  feet),  add $1.00 

1  by  6,  10  feet,  No.  1 

1  by  6,  8  to  18  feet,  No.  2 

1  by  8,  8  to  18  feet,  No.  2 

1  by  6,  10  to  16  feet,  No.  1   (25  per 

cent  10  feet),  add 3.  00 

ROOFING    LATH. 

1  by  2,  1  by  21,  and  1  by  3,  10  to  16 

feet,    add . $5.00 

SPECIAL   SIZES. 

For  each  inch  over  12  inches  in  width 
in  timber  and  plank  add  50  cents  per  M.  ; 
5  inches,  7  inches,  9  inches,  and  11  inches 
sawed  to  order,  .$1  per  M.  extra. 

PRICES    FOR    WORKING    LUMBER. 
\ 

Saw  sized  or  SlSlE__per  M $1.  75 

Dressing  1  or  2  sides    (except  L.  R. 

No.  2  and  3  boards) per  M 1.50 

Ship    lap    or    matching     (except    as 

specified  under  D  and  M.  boards- _ 

per  M__     2.  00 
Joicts  worked  to  flooring,  or  grooved 

2  edges,  or  dressed  4  sides_per  M 2.  00 


780 


HISTORY   OF   PRICES   DURING  THE   WAR. 


(Aug.  15,  1918.) 

The  price-fixing  committee  of  the  War  Industries  Board  announces  a  base 
price  of  $29,  an  increase  of  $2  over,  the  former  price  of  Pennsylvania  hemlock 
lumber.  The  entire  output  of  No.  1  and  No.  2  grades  will  probably  be  required 
by  the  Government,  and  the  stock  will  be  distributed  subject  to  the  control  of 
the  War  Industries  Board.  Following  is  the  official  announcement : 

"After  considering  the  information  submitted  by  the  Federal  Trade  Commis- 
sion as  to  the  cost  of  hemlock-lumber  production  in  the  State  of  Pennsylvania, 
and  the  information  submitted  by  the  representatives  of  the  manufacturers  of 
such  lumber  at  a  hearing  granted  them  on  Wednesday,  August  14,  1918,  the 
price-fixing  committee  of  the  War  Industries  Board,  by  agreement  with  the 
producers,  passed  a  ruling  fixing  a  maximum  base  price  for  mill  shipments  of 
Pennsylvania  hemlock  lumber  at  $29  per  thousand  feet,  f.  o.  b.  cars  shipping 
point,  sucli  price  to  become  effective  midnight  August  15,  1918,  and  to  remain 
in  effect  to  and  including  October  20,  1918. . 

"  The  following  companies,  producing  the  greater  part  of  Pennsylvania  hem- 
lock lumber,  were  present  at  the  hearing :  Goodyear  Lumber  Co.,  Norwich,  Pa. ; 
Wheeler  &  Dusenbury,  Endeavor,  Pa. ;  Pennsylvania  Lumber  Co.,  Killettsville, 
Pa. ;  Central  Pennsylvania  Lumber  Co.,  Williamsport,  Pa. 

"  By  reason  of  the  construction  program  of  the  various  governmental  depart- 
ments, it  is  apparent  that  the  Government  will  require  substantially  the  entire 
output  of  No.  1  and  No.  2  grades  of  Pennsylvania  hemlock.  It  was,  therefore, 
agreed  at  the  hearing  by  all  of  the  above  manufacturers: 

"(1)  That  their  entire  stock  and  production  of  Pennsylvania  hemlock, 
grades  Nos.  1  and  2,  will  be  held  available  for  the  direct  and  indirect  needs 
of  the  Government  in  the  war,  and  will  be  distributed  and  dealt  in  subject  to 
the  control  of  the  War  Industries  Board. 

"(2)  That  such  of  the  foregoing  lumber  as,  in  the  judgment}  of  the  chief  of 
the  lumber  section  of  said  board,  can,  without  detriment  to  governmental 
requirements,  be  released  for  urgent  commercial  or  other  needs  may  be  sold 
to  car-lot  purchasers  (with  his  consent)  at  prices  which,  per  item,  shall  not 
exceed  the  prices  as  established  by  the  attached  list." 

The  "  attached  "  list  referred  to  above  contains  the  item  prices,  which  are 
unchanged  from  the  old  list,  except  that  they  apply  to  the  new  $29  base. 


2  by  3  : 


NO.    1    SIZES. 


10  feet  (ripped  from  2  by  6)__  $30.  00 

32  and  14  feet__  30.  00 

16  feet 32.  00 

18  and  20  feet 34.  50 

2  by  4: 

8  feet,  L.  R 27.  00 

9  feet,  L.  R.   (when  in  stock).  31.  00 

10  feet 29.  00 

12  feet 29.  00 

14  feet 29.  00 

16  feet__                              32.  00 

18  and  20  feet 33.  50 

22  and  24  feet 34.  50 

2  by  6  to  12  by  12  : 

10  feet   (when  in  stock) 29.00 

12  and  14  feet 29.  00 

16  feet__  30.  50 

18  and  20  feet 32.  50 

22  and  24  feet__  34.  50 

26  and  28  feet 35.  50 

30  and  32  feet 36.  50 

34  and  36  feet 38.  50 

38  and  40  feet 40.  50 

3  by   4  to   12  by  12,   add   50   cents  per 

M  feet  to  price  of  2  by  6  to  2  by  12,  same 

lengths. 

2-inch   sizes,   No.    2,   $2   per  M   feet   less 

than  same  size  in  No.   1. 


NO.  i  BOARDS. 

1  by  6  : 

10,  12,  and  14  feet $29.  00 

16  feet 34.  00 

18  and  20  feet 33.  00 

1  by  8: 

10,  12,  and  14  feet___  29.  00 

16  feet 31.  00 

18  and  20  feet 32.  50 

1  by  10 : 

10,  12,  and  14  feet 30.  50 

16  feet 34.  00 

18  and  20  feet 34.  00 

1  by  12  : 

12  feet 33.  50 

10  and  14  feet 31.00 

16  feet 35.  00 

18  and  20  feet 35.  00 

5/4  and  6/4,  add   $2  to  price  of  boards 

same  width. 

NO.  2  BOARDS. 

1  by  6,  8  to  18,  rough  or  SIS $28.  00 

1  by  8,  8  to  18,  rough  or  SIS 29.  00 

1  by  10,  8  to  18,  rough  or  SIS 29.  50 

1  by  12,  8  to  18,  rough  or  SIS 29.  50 

NO.  3  BOARDS. 

1  bv  6  to  12,  8  to  18  feet,  rough  or 

S1S_.             $25.00 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


781 


LOG    RUN   BOARDS. 

1  by  4,  8  to  16,  rough  or  S1S__      _   $25.  00 
1  by  6  to  12,  8,  rough  or  S1S__.  26.  00 

1  by  6  to  12,  10,  rough  or  SIS 29.  00 

DRESSED  AND  MATCHED  BOARDS. 

1  by  4,  8  to  16  feet   (25  per  cent, 

10  feet),  No.  1 $30.00 

1  by  6,  10  feet,  No.  1 29.  00 

1  by  6,  10  to  16  feet  (25  per  cent, 

10  feet),  No.  1 32.00 

1  by  6,  8  to  18  feet,  No.  2__  29.  00 

1  by  8,  8  to  18  feet,  No.  2 29.  00 

ROOFING   LATH. 

1  by  2,  1  bv  21,  and  1  by  3,  10  to 

16    foot_l__: $34.00 


PP.ICES  FOR  WORKING  LUMBER. 

(Per  M  feet.) 

Paw  sizes  or  S1S1E__.  $1.75 

Dressing  1  or  2  sides  (except  L.  R. 

and  Nos.  2  and  3  boards) 1.50 

Ship-lap  or  matching  (except  as 

specified  under  D.  and  M.  boards)-  2.  00 
Joists  worked  to  flooring,  or  grooved 

2  edges,  or  dressed  4  sides 2.  00 

SPECIAL   SIZES. 

For  each  inch  over  12  inches  in  width 
in  timber  and  plank  add  50  cents  per  M; 
5  inches,  7  inches,  9  inches,  and  11  inches, 
sawed  to  order,  $1  per  M  extra. 


SOUTHERN  OR  YELLOW  PINE. 

Informal  arrangements. — The  lumber  committee  of  the  Council  of  National 
Defense  made  an  informal  agreement  with  the  Southern  Pine  Association  on 
June  13,  1917.  This  agreement  covered  items  of  lumber  necessary  for  the  build- 
ing of  cantonments.  The  average  price  for  the  grades  required  was  $20  per 
thousand  board  feet. 

On  September  11,  1917,  a  voluntary  reduction  of  $1  per  thousand  was  made 
on  1-inch  boards  and  50  cents  per  thousand  on  2- inch  dimensions.  Another 
reduction  of  approximately  50  cents  per  thousand  became  effective  October  10, 
1917. 

A  third  reduction  in  November  made  a  total  average  reduction  of  $1.65  per 
thousand  board  feet. 

On  November  21,  1917,  the  War  Industries  Board,  upon  the  recommendation 
of  the  lumber  committee,1  approved  lumber  prices  for  a  period  up  to  December 
10,  1917.  The  price  then  in  effect  was  equivalent  to  $23.20  per  thousand  feet 
mill  run.  These  prices  were  published  on  January  28,  1918,  by  the  southern 
emergency  bureau  and  by  the  Alabama  and  Mississippi  emergency  bureau. 

No  action  was  then  taken  by  any  Government  agency  until  March  21,  1918, 
when  the  price-fixing  committee  decided  not  to  grant  an  advance  in  price.  Dur- 
ing the  period  of  agreement  the  prices  were  fixed  to  the  Government  only. 

In  June,  1918,  the  industry  asked  for  another  advance  in  prices  with  permis- 
sion to  apply  the  fixed  price  to  Government  purchases  only.  Mr.  Baruch  on 
this  occasion  stated  that  "  the  President  was  emphatic  upon  the  point  that  the 
prices  fixed  should  apply  both  to  the  Government  and  to  the  public,  even  if  the 
Government  had  to  suffer  thereby."2 

The  price-fixing  committee  then  fixed  the  price  of  yellow  pine,  effective  June 
15,  1918,  at  $28  per  thousand  board  feet  to  both  civilian  and  Government  pur- 
chasers. The  ne\v  schedules  on  this  basis  represented  an  advance  of  approxi- 
mately $4.80  per  thousand  over  the  former  price  lists. 

Except  for  minor  modifications,  these  schedules  were  reviewed  again  in 
September,  1918,  and  remained  in  force  until  December  23,  1918,  when  control 
ceased.  At  that  time  the  following  notice  was  sent  by  the  lumber  division  of 
the  War  Industries  Board  to  the  southern  lumber  administrator : 

Regarding  status  of  unshipped  orders  entered  since  June  14,  1918,  at  the 
expiration  of  the  present  leases,  December  23,  1918,  Government  orders  will  be 
subject  to  rate  negotiation  as  to  prices.  Commercial  orders  entered  during  the 
above  period  at  agreed-upon  item  prices  will  not  be  affected.3 

1  Minutes  of  the  War  Industries  Board,  Nov.  21,  1917. 

2  Minute  Book  V  of  the  price-fixing  committee,  meeting  of  June  13,  1918. 

3  Federal  Trade  Information  Service,  Dec.  23,  1918. 


782 


HISTORY   OF   PRICES   DURING   THE   AVAR. 


(Nov.   11,  1917,   to  June  15,   1918.) 

Government  yellow  pine  or  southern  pine  maximum  prices  covering  States  of  Missouri, 
Arkansas,  Texas,  Oklahoma,  Louisiana,  Mississippi,  Tennessee,  and  Alabama,  and  that 
part  of  Florida  tying  west  of  the  east  line  of  Alabama  if  continued  to  the  Gulf: 


B  and 
better 
rift. 

B  and 
better. 

No.  1 
common. 

No.  2 
common. 

1  by  3  flooring      

$44  00 

$32.00 

$29  00 

$19  00 

1  by  4  floorin^ 

42  00 

30  00 

27  00 

19  00 

1  by  G  flooring 

32.  50 

27.50 

20  00 

1  by  3  to  G  inches  flooring 

19  50 

1  by  4  and  6  inciies  flooring. 

19.50 

§  by  4  ceiling 

2S  00 

25  00 

IS  00 

|  by  4  ceiling  

31.00 

27.50 

19.00 

1  by  6  drop  sidin'1' 

31.00 

27.00 

21.00 

B  and 
better. 

"C." 

No.  1 
common. 

1  bv  4  random  lengths 

$31  50 

$28  00 

1  by  6  a>nd  8  inches^  random  lengths            

33  00 

30.00 

1  by  10  random  lengths 

31  00 

31  50 

1  by  12,  random  lengths                          

35.00 

32.00 

1  by  4  to  12  random  lengths 

33  00 

30  00 

1^  by  4  to  8  inches,  random,  lengths      ,.... 

38.00 

$31.00 

I1  by  10  and  12jnches  random  lengths 

40.00 

33  00 

l|  by  4  to  8  inciies,  random  len^hs      

38.00 

31.00 

ll  by  10  and  12  inches  random  lengths 

40.00 

33  00 

2*by"4  to  8  inches,  random  lengths               

38.  00 

2  by  10  and  12  inches  random  lengths 

40  00 

The  above  prices  are  for  S2S  finish ;  for  S4S  add  50  cents  per  thousand  feet ;  for 
specified  lengths  add  $1  per  thousand  feet ;  for  rough  deduct  50  cents  per  thousand 
feet. 


Boards. 

Iby2. 

Iby3. 

Iby4. 

Iby  6. 

I  by  8. 

1  by  10. 

1  by  12. 

1  bv  4  to 
12. 

No.  1  SI  or  2S  . 

$24.00 

$25.  00 

$23.00 

$24.00 

$24.00 

$24.00 

$27.00 

No  2  81  or  23 

19  00 

20.00 

18.00 

19.00 

20.00 

20.00 

22  00 

$20  00 

No.  3  SI  or  23  . 

15.00 

15.50 

16.00 

16.00 

1G.50 

15.50 

For  1  inch  No.  1  and  No.  2  in  specified  lengths  add  50  cents,  except  16  feet  and  $1  : 
rough  50  cents  less  than  S2S  ;  S4S,  D.  &  M.  or  shiplap  add  50  cents  to  S2S  prices.  For 
resawing  add  $1  per  thousand  feet. 


Dimension. 

10,  18, 
and  20 
feet. 

12,  14, 
and  16 
feet. 

22  and 
24  leet. 

Random. 

2  by  2  No  1  common  S1S1E 

$22  50 

S20  50 

£24  00 

$20  50 

2  by  3  No.  1  common,  S1S1E          ..                 

20.09 

19.00 

21.50 

19.00 

2  by  4  No  1  common  S1S1E 

21  50 

19  50 

23  00 

19  50 

2  by  6  No.  1  common,  S1S1E  

19.00 

18.00 

20  50 

18.00 

2  by  8  No  1  common,  S1S1E 

21.00 

19  00 

22  50 

19  GO 

2  by  10  No.  1  common,  S1S1E  

21.50 

19.50 

23.00 

19.50 

2  by  12  No.  1  common,  SIS  IE 

23.00 

21.50 

24  50 

21  50 

2  by  2  No.  2  common,  S1S1E  

21.00 

19.00 

22.50 

19.00 

2  by  3  No.  2  common,  S1S1E                                  .   . 

18  50 

17  50 

20  00 

17.50 

2  by  4  No  2  common,  S1S1E 

20  00 

18  00 

21  50 

18  00 

2  by  6  No.  2  common,  S1S1E                         

17.50 

16  50 

19  00 

16.50 

2  by  8  No  2  common,  S1S1E 

19  50 

17  50 

21  00 

17  50 

2  by  10  No.  2  common,  S1S1E  .                              .     . 

20.00 

18.00 

21.50 

18.00 

2  by  12  No.  2  common,  S1S1E 

21  50 

20  GO 

23  00 

20  00 

No.  3  common,  S1S1E,  8  to  20  feet:  2  by  4  and  8  inches,  $13  ;  2  by  6,  $12.50;  2  by  10, 
$13.50  ;  2  by  12,  $14. 

For  D.  &  M.  or  shiplap  add  $1  per  thousand  to  S1S1E  prices  ;  rough  50  cents  less  than 
S1S1E  prices;  for  S4S  dimension  add  50  cents  per  thousand  to  S1S1E  prices;  for  No.  1 
dimension  over  24  feet  add  $1  for  each  2  feet  tip  to  32  feet. 


GOVERNMENT   REGULATIONS  RELATING  TO  PRICES. 


783 


3  by  4  and  4  by  4. . 
3  by  6  to  8  by  8.... 
3  by  10  to  4  by  10. . 
5  by  10  to  10  by  10. 


The  above  prices  on  short  and  on  long 
leaf  rough  No.  1. 


3  by  12  to  5  by  12 

6  by  12  to  12  by  12.. 

2  by  14  to  5  by  14 

6  by  14  to  8 by  14..... 
10  bv  14  to  14*by  14... 


10  to  20 
20  feet. 


£20.00 
19.00 
23.00 
22.00 


25.00 
24.00 
30.00 
29.50 
29.00 


22  and 
24  feet. 


26  feet. 


321. 00 

20.00 
24.00 
23.00 


20.  00 
25.00 
31.00 
30.50 
30.00 


822.  00 
21.00 
25.00 
24.00 


27.00 
26.00 
32.00 
31.50 
31.  00 


28  feet. 


$23. 00 
22.00 
26.00 
25.00 


28.00 
27.00 
33.00 
32.50 
32.00 


30  feet. 


§24.  00 
23.00 
27.00 
26.00 


29.00 
28.00 
34.00 
33.50 
33.00 


32  feet. 


S25.  00 
24.00 
28.00 
27.00 


30.00 
29.00 
35.00 
34.50 
34.00 


The  above  prices  are  for  short-leaf  No.  1  common  ;  for  long-leaf  timbers  No.  1  common 
12-inch  and  14-Luch  face  add  $2  per  thousand  to  prices  shown  above. 

For  merchantable  add  $3  per  thousand  for  10  inches  and  under. 

For  merchantable  add  $2  per  thousand  for  12  inches  and  over. 

All  prices  on  the  above  are  based  on  furnishing  rough. 

For  dressing  3-inch  plank  4  inches  and  wider  and  small  timbers  up  to  and  including 
(5  by  6  add  50  cents  per  thousand. 

For  dressing  6  by  8  and  larger  add  $1  per  thousand. 

For  timbers  over  14  inches,  add  $3  for  each  2  inches  above  14  inches  ;  for  timbers  over 
32  feet,  add  $1  for  each  foot ;  for  tongue  and  grooved  or  shiplapping  timbers,  add  $2  per 
thousand  for  3  inches  and  over;  for  grooving  timbers  5  inches  thick  or  thicker  for  splines, 
add  $5  per  thousand  to  above  dressed  prices  ;  for  grooving  timbers  3  and  4  inches  thick 
for  splines,  add  $3  to  above  dressed  prices ;  for  beveling  and  outgaging,  add  $2  per 
thousand  feet. 

EXPORT  PRICES. 

[Grading  as  per  Gulf  coast  specifications  of  1910.] 

PRIME. 

1-inch  random  widths  and  lengths $43.00 

IJ-inch  random  widths  and  lengths 48.  00 

li-inch  random  widths  and  lengths 48.  00 

2-inch  random  widths  and  lengths 48.  00 

GENOA   OK   KIO   PRIME   DEALS. 

3  to  5  inches  thick,  4  to  8  inches  wide,  16  feet  and  up  to  average  24  feet 27.  00 

3  to  5  inches  thick,  9  and  10  inches  wide,  16  feet  and  up  to  average  24  feet 31.  00 

3  to  5  inches  thick,  11  and  12  inches  wide,  16  feet  and  up  to  average  24  feet 35.  00 

MERCHANTABLE     SAWN     TIMBERS. 

Regular  cubic  average  : 

30  cubic $31.00 

321  cubic 32.  50 

35  cubic 34.  00 

37J  cubic 35.  00 

40  cubic 37.  50 

M.    C.    B.    CAK    SIDING    PATTERN. 

1  by  4  and  6  inches,  B.  and  better  : 

5  feet $30.  00 

8  or  16  feet 32.00 

9  or  18  feet 36.  00 

10  or  20  feet 35.00 

M.    C.    B.    CAR    LINING    AND    ROOFING    PATTERN. 

1  by  4  and  6  inches,  B.  and  better,  5  feet  or  multiples $33.  00 

1  by  4,  random  lengths,  No.  1 27.00 

1  by  6,  random  lengths,  No.  1 27.  50 

STANDARD  CAR    DECKING. 

2  by  6  and  8  inches,  9,  10,  18,  and  20  feet,  dressed  to  11 - $25.  00 

2J  by  6  and  8  inches-,  9,  10,  18,  and  20  feet,  dressed  to  2J 26.  00 

NO.  1  COMMON  DIMENSION   WORKED  TO  CAR   DECKING. 

2  by  6,  9,  10,  18,  and  20  feet,  dressed  to  13 $21.00 

2  by  8,  9,  10,  18,  and  20  feet,  dressed  to  if 23.  00 

For  heart-face  decking,  add  $3  per  thousand. 

CAR   FRAMING. 

Long  leaf  merchantable  grade  S4S  to  J-inch  scant  and  cut  to  length — 

TTp  to  8  inches,  20  feet  and  under $20.  00 

10  inches,  20  feet  and  under 28.  00 

12  inches,  20  feet  and  under 33.  00 

14  inches,  20  feet  and  under 36.  00 


784  HISTORY  OF  PRICES  DURING  THE  WAR. 

CAR   SILLS. 

For  price  on  car  sills,  use  timber  list ;  for  price  of  construction  timbers  and  caps,  use 
timber  list ;  for  85  to  90  per  cent  cubical  contents  heart,  add  .$4  per  thousand  feet,  No.  1 
common  long-leaf  price ;  for  standard  heart  with  special  sap  location,  add  $5  per  thousand 
feet  to  No.  1  common  Ions-leaf  price ;  for  prices  for  States  of  Georgia  and  that  part  of 
Florida  lying  east  of  Alabama  east  line  if  continued  to  the  Gulf,  add  $1  per  thousand  to 
all  prices  shown  above. 

(June  14,  1918.) 

After  considering  the  information  submitted  by  the  Federal  Trade  Commis- 
sion as  to  the  cost  of  manufacturing  southern  or  yellow  pine  lumber  and  the 
information  submitted  by  the  representatives  of  the  manufacturers  thereof  at 
the  hearings  held  on  the  12th,  13th,  and  14th  of  June,  1918,  at  which  their 
request  for  a  readjustment  of  prices  on  xtheir  products  was  heard,  the  price- 
fixing  committee  appointed  by  the  President  has  determined,  by  agreement 
with  the  said  representatives  of  the  manufacturers  of  southern  or  yellow  pine 
lumber,  upon  the  following  maximum  prices  for  such  lumber.  These  maximum 
prices  shall  not  be  exceeded  on  any  sales  and  contracts  for  sale  (for  mill  ship- 
ment) made  during  a  period  of  three  months  beginning  midnight  June  14, 
1918,  either  to  the  public,  to  the  Government,  to  governments  of  the  nations 
associated  with  us  in  the  present  war,  or  the  railroads,  whether  by  rail  or  by 
water  shipment. 

The  prices  of  all  southern  or  yellow  pine  lumber  in  the  States  of  Missouri, 
Arkansas,  Oklahoma,  Texas,  Louisiana,  Mississippi,  Tennessee,  Alabama, 
Georgia,  and  Florida  shall  not  exceed  the  item  prices  named  in  attached  list, 
except  that  in  the  first  three  States  named  above  an  additional  price  of  $3  per 
thousand  will  be  allowed  on  all  items  of  short  leaf  soft  pine  C  and  better  finish, 
casing,  base,  and  jambs. 

Prices  on  items  not  covered  by  above  list  shall  be  priced  on  basis  of  nearest 
comparable  item. 

The  usual  trade  practices  shall  continue,  including  cash  discounts  to  be 
applied  to  the  United  States  Government  purchases  as  well  as  all  others,  except 
that  in  commercial  transactions  where  purchasers  do  not  avail  themselves  of 
the  cash  discounts  the  accounts  may  be  converted  into  trade  acceptances  which 
do  not  bear  interest  before  maturity. 

The  custom  of  delivered  prices  of  lumber  to  purchasers'  destination  points 
shall  remain  unchanged,  including  the  equalization  of  freight  rates. 

Contracts  for  the  sale  of  lumber  entered  into  in  good  faith  prior  to  midnight 
June  14.  1918,  and  enforcible  at  law,  will  be  performed  in  accordance  with  their 
terms,  subject,  of  course,  to  orders  received  from  the  Government  which  may 
require  priority. 

It  is  imperative  that,  with  the  least  possible  disruption  of  the  industry,  the 
vast  war  needs  of  the  Government,  both  direct  and  indirect,  for  southern  or 
yellow  pine  lumber  be  supplied  on  a  fair  basis;  that  an  adequate  supply  and 
equitable  distribution  thereof  be  assured  for  essential  commercial  needs;  that 
the  movement  thereof  be  facilitated,  and  that  injurious  speculation  therein  be 
prevented.  Therefore  the  procedure  outlined  below,  by  agreement  with  the 
representatives  of  the  manufacturers  of  southern  or  yellow  pine  lumber,  has 
been  adopted  for  a  period  of  three  months  beginning  midnight  June  14,  1918. 

The  procedure  is  that  each  manufacturer  of  southern  or  yellow  pine  lumber 
shall— 

(1)  Make  contracts  and  accept  orders  for  his  product  at  prices  not  in  excess 
of  the  applicable  maximum  prices,  always  subject  to  an  option  at  the  appli- 
cable maximum  prices  in  favor  of  the  United  States  or  the  nominee  of  the 
War  Industries  Board.  Under  this  option,  which  will  cover  all  southern  or 
yellow  pine  lumber  down  to  time  of  actual  delivery  to  the  purchaser,  the  War 
Industries  Board,  to  any  extent  required,  will  allocate  either  .to  the  Govern- 


GOVERNMENT  REGULATIONS  RELATING   TO   PRICES. 


785 


ment  or  to  other  essential  users.  Any  balance  not  so  allocated  will  be  released 
for  sale  to  commercial  buyers,  but  at  prices  no  greater  than  those  determined 
upon  as  above  set  forth. 

(2)  Comply  with  the  directions  of  the  War  Industries  Board  as  issued  from 
time  to  time  with  reference  to  filling  commercial  requirements  in  the  order  of 
their  public  importance  and  to  furnishing  such  information  and  making  such 
reports  as  may  be  required. 

(3)  Keep  up  to  the  best  of  his  ability  the  production  of  southern  or  yellow 
pine  lumber,  so  as  to  insure  an  adequate  supply  so  long  as  the  war  lasts. 

(4)  Neither  reduce  the  scale  of  wages  now  being  paid  nor  change  funda- 
mental labor  conditions  now  in  force. 

The  Government  will  apportion  the  car  supply  available  for  lumber  and 
arrange  for  its  transportation,  subject  to  allocation  by  the  War  Industries 
Board  as  aforesaid,  to  the  end  that  injury  to  the  industry  due  to  abnormal 
war-time  conditions  be  neutralized  so  far  as  may  be. 

Foreign  trade,  except  to  the  governments  of*  nations  associated  with  us  in 
the  present  war,  is  not  to  be  affected  by  this  ruling. 

GOVERNMENT  MAXIMUM  PRICE   LIST. 

Government  yellow  pine"  or  southern  pine  maximum  prices,  effective  midnight  June  14 
to  and  including  September  14,  1918,  covering  States  of  Missouri,  Arkansas,  Texas,  Okla- 
homa, Louisiana,  Mississippi,  Tennessee,  Georgia,  Florida,  and  Alabama  : 


B  and 
better 
heart 
rift. 

B  and 
better 
rift. 

Band 
better. 

No.l 

common. 

No.  2 
common. 

1  by  3  flooring                                          

$54.00 
66.00 
52.00 
63.00 

$48.00 
60.00 
46.00 
57.00 

$36.00 
48.00 
34.00 
46.00 
36.50 

i$34.00 

$24.50 

1J  by  3  flooring       

1  by  4  flooring                             .           

132.00 

24.50 

l\  by  4  flooring  

1  by  6  flooring     .           

133.00 

25.50 
25.00 
25.00 
22.50 
23.50 
24.50 

1  by  3  to  6inch  flooring  

1  by  4  and6  inch  flooring  

by  4  3  ei  ling  

30.50 
32.00 
35.00 
37.00 
39.50 
35.00 
25.00 
27.50 

29.00 
30.50 
33.00 
34.00 
36.50 
32.5*0 
23.00 
25.50 

bv  4ceiling 

" 

by  436iling 

by  4  partition                   

by  6  partition 

by  6  drop  siding  ...                        

26.50 
19.00 
21.50 

Bevelsiding  from  1-inch  stock 

Bevelsiding  frojn  1  J-inch  stock  

1  Denotes  grade  as  per  rule  on  flooring.    Add  $1  per  thousand  feet  for  specified  lengths. 


Finish  S2S. 

Band 

better. 

c. 

No.  1 
common. 

1  by  4  random 

$35  50 

$32  00 

1  by  6  and  8  inch,  random  

37  00 

34  00 

1  by  10  random 

38  00 

35  50 

1  by  12  random  

39.00 

36.00 

1  by  4  to  12  inch  random 

37  00 

34  00 

IJby  4  to8-inch  random  

42.00 

36  50 

l|  by  10  and  12  inch  random  

44  00 

38  50 

l|  by  4  to  8  inch  random 

42  00 

36  50 

H  by  10  and  12  inch  random  

44.00 

38  50 

2  by  4  to  8  inch  random  

42.00 

2  by  10  and  12  inch  random  :  

44.00 

Molded  casing  and  base  from  1  by  4,  6  and  8  inch  stock.  . 

43  00 

Molded  casing  and  base  from  1  by  5  and  10  inch  stock  

45.00 

Jambs  from  4/4  stock  

43.00 

Jambs  from  5/4  and  6/4  stock  and  8/4  

48.00 

The  above  prices  are  for  S2S  finish;  for  S4S  add  50  cents  per  thousand  feet;  for  specified  lengths,  add  $1 
per  thousand  feet;  for  rough,  deduct  50  cents  per  thousand  feet. 

NOTE.— C  and  better  shortleaf  finish,  base,  casing,  and  jambs  manufactured  in  the  States  of  Missouri, 
Oklahoma,  and  Arkansas  may  be  sold  at  $3  per  thousand  higher  than  above  prices. 

Moldings:  1§  ineh  width  and  smaller,  55  per  cent  discount;  1|  inches  and  wider — 50 
per  cent  discount. 

125547°— 20 50 


786 


HISTORY   OF  PRICES   DURING  THE   WAR. 


Boards. 

1  by  2. 

IbyS. 

1  by  4. 

IbyG. 

IbyS. 

1  by  10. 

1  by  12. 

Ibv4 
to  12. 

No.  1  Si  or  2S 

$29.  50 

830.  50 

$28.  50 

$29.  50 

$29.50 

$29.50 

$32  50 

No  2  SI  or  2S 

24.50 

25.50 

23  50 

24  50 

25  50 

25.  50 

27  50 

$25  50 

No.  3,  SI  or  2S  

20.50 

21.00 

21.50 

21.50 

22.00 

21  00 

No.  4,  Si  or  2S      .... 

15  00 

For  1  inch  No.  1  and  No.  2  in  specified  lengths,  add  50  cents,  except  16  feet  add  $1 ; 
rough,  50  cents  less  than  S2S  ;  S4S,  P.  and  M.  or  shiplap,  add  50  cents  to  S2S  prices, 
or  resawing,  add  $1  per  thousand. 

Boards  when  ordered  kiln  dried,  add  Jjjl  per  thousand  feet. 


Dimensions. 

10,  18, 
and  20 
feet. 

12,14, 
and  16 

feet. 

22  and 

24  feet. 

Random. 

2  by  2,  No.  1  common,SlSlE..  

$26.  50 

$24.  50 

$28  00 

§24  50 

2  by  3,  No.  1  common  SlSlE 

24  00 

23  00 

25  50 

23  00 

2  by  4,  No.  1  common,  S1S1E  

25.50 

23.50 

27  00 

23  50 

2  by  6,  No.  1  common,  SlSlE 

23.00 

22  00 

24  ^0 

2?  00 

2  by  8,  No.  I  common,  SlSlE   

25.00 

23.00 

26.  50 

23  00 

2  by  10,  No.  1  common,  Si  SlE 

25.50 

23  50 

27  00 

23  50 

2by  12,  No.  Icommon,  S1S1E  

27.00 

25.  50 

28  50 

25  50 

2  by  2,  No.  2  common,  SlSlE 

25  00 

23  00 

26  50 

23  00 

2  by  3  No.'2  common  SlSlE 

22  50 

21  50 

24  00 

21  50 

2  by  4,  No.  2  common,  SlSlE 

24.00 

22  00 

25  50 

2*>  00 

2  by  6  No.  2common  SlSlE 

21  50 

20  50 

23  00 

20  50 

2  by  8,  No.  2  common,  Si  SlE 

23.50 

21  50 

25  00 

21  50 

2  by  10,  No.  2  common,  Si  SlE  

24.00 

22.00 

25.  50 

22  00 

2  by  12,  No.  2  common,  SlSlE 

25.50 

24.00 

27  00 

21  00 

2  by  4bv2by  8,  No.  3  common,  SlSlE  (8  to  20  feet)   

17.00 

2  by  6,  No.  3  common,  SlSlE  (8  to  20  feet) 

16  50 

2  by  10,  No.  3  common,  SlSlE  (8  .to  20  feet)  

17.  50 

2  bv  12,  No.  3  common,  SlSlE  (8  to  20  feet) 

18  00 

Dimension  when  ordered  sized  1-inch  scant  in  thickness  and/or/width,  add  $2  per 
thousand  feet. 

Dimension  when  ordered  kiln-dried,  add  $2  per  thousand  feet. 

Dimension  D.  and  M.  or  shiplap,  add  •$!  per  thousand  to  SlSlE  prices ;  rough,  50 
cents  less  than  SlSlE  prices  ;  S4S,  add  50  cents  per  thousand  to  SlSlE  prices. 

For  No.  1  common,  dimension  over  24  feet,  add  f  1  for  each  2  feet  up  to  32  feet. 

NOTE. — All  lumber  not  over  2  inches  thick,  when  ordered  odd  or  fractional  lengths,  will 
invoice  as  of  next  longer  length  in  multiple  of  2  feet. 


Timbers. 

10  to  20 

feet. 

22  and  24 
feet. 

26  feet. 

2S  feet. 

30  feet. 

32  feet. 

3  by  4  and  4  by  4 

$25.00 
24.00 
28.00 
27.00 
30.00 
29.00 
35.00 
34.50 
34.00 

$26.00 
25.00 
29.00 
28.00 
31.00 
30.00 
36.00 
35.  50 
35.00 

$27.00 
26.00 
30.00 
29.00 
32.00 
31.00 
37.00 
36.50 
36.00 

$28.00 
27.00 
31.00 
30.00 
33.00 
32.00 
38.00 
37.50 
37.00 

$29.  00 
28.  00 
32.00 
31.00 
34.00 
33.00 
39.00 
3S.50 
38.00 

$30.  00 
23.00 
33.00 
32.00 
35.00 
34.00 
40.  00 
39.  50 
39.00 

3  "by  6  to  8  by  8  

3  by  10  to  4  by  10 

5  by  10  to  10  by  10  

3  by  12  to  5  by  12 

6  by  12  to  12  by  12  

3  by  14  to  5  by  14 

6  bv  14  to  8  by  14  

10  by  14  to  14  by  14 

Add  for  plaJik  2  inches  thick,  -cut  full  size,  $1  per  thousand  to  list  of  3  inches  of  same 
width  or  over. 

Add  for  timbers  14  inches  $3  for  each  2  inches  over  14  inches. 

All  for  timbers  over  32  feet  $1  for  each  foot  over  32  feet. 

Prices  above  are  for  short-leaf  No.  1  common  rough  ;  for  better  qualities  and  various 
working  apply  the  following  differentials  : 

For  long  leaf  No.  1  common  add  $2  per  thousand  feet. 

For  merchantable  10  inches  and  smaller  add  $3  per  thousand  to  No.  1  long-leaf  price. 

For  merchantable  12  inches  and  larger  add  $2  per  thousand  to  No.  1  long-leaf  price. 

For  prime  rule  of  1905  add  $5  to  No.  1  long-leaf  price. 

For  85  to  90  per  cent  cubical  contents  heart,  12  inches  and  under,  -add  to  No.  1  common 
long  leaf  $3  per  thousand. 

For  85  to  90  per  cent  cubical  contents  heart,  14  inches  nud  under,  add  to  No.  1  common 
long  leaf  $3.50  per  thousand. 

For  85  to  90  per  cent  cubical  contents  heart,  16  inches  and  under,  add  to  No.  1  com- 
mon long  leaf  $4.50  per  thousand. 

For  85  to  90  per  cent  facial  area  heart,  12  inches  and  under,  add  to  No.  1  common 
long  leaf  $5  per  thousand. 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  787 

For  85  to  90  per  cent  facial  area  heart,  14  inches  and  under,  add  to  No.  1  common 
long  leaf  $5.50  per  thousand. 

For  85  to  90  per  cent  facial  area  heart,  16  inches  and  under,,  add  to  No  1  common 
long  leaf  $6.50  per  thousand. 

For  all  heart  timbers  12  inches  and  under  add  to  No.  1  common  long  leaf  $7  per 
thousand. 

For  all  heart  timbers  14  inches  and  under  add  to  No.  1  common  long  leaf  $8  per 
thousand. 

For  all  heart  timbers  16  inches  and  under  add  to  No.  1  common  long  leaf  $10  per 
thousand. 

For  standard  heart  timbers  12  inches  and  under  add  to  No.  1  common  long  leaf  $4  ner 
thousand. 

For  standard  heart  timbers  14  inches  and  under  add  to  No.  1  common  long  leaf  $5  50 
per  thousand. 

For  standard  heart  timbers  16  inches  and  under  add  to  No.  1  common  long  leaf  $6.50. 

For  heart  face,  one  face  only,  12  inches  and  under,  add  to  No.  1  common  long  leaf 
$4.50  per  thousand. 

For  heart  face,  one  face  only,  14  inches  and  under,  add  to  No.  1  common  long  leaf 
$5  per  thousand. 

For  heart  face,  one  face  only,  16  inches  and  under,  add  to  No.  1  common  long  leaf 
$6  per  thousand. 

Add  for  dressing  $1  per  thousand  feet. 

Add  for  tongue  and  groove  or  shiplap  $2  per  thousand  feet. 

Add  for  grooving  $3  per  thousand  to  dressed  price  stock  3  inches  and  4  inches  thick. 

Add  for  grooving  $5  per  thousand  to  dressed  price  stock  5  inches  and  thicker. 

Add  for  beveling  and  outgauging  $2  per  thousand  feet  to  dressed  prices. 

NOTE. — All  timber  when  ordered  in  odd  or  fractional  lengths,  will  invoice  as  of  next 
longer  length  a  multiple  of  2  feet. 

Add  $1  to  list  when  ordered  cut  on  fractional  sizes.  Prices  on  fractional  sizes  will 
be  determined  as  follows :  Sizes  containing  fractions  under  one-half  inch  shall  take 
price  of  next  smaller  size  listed.  Sizes  containing  fractions  half  inch  or  greater  shall 
take  price  of  next  larger  size  listed.  For  examples  : 

5J  by  81  inches  will  take  price  of  6  by  8  plus  $1. 
5i  by  81  inches  will  take  price  of  6  by  10  plus  $1. 

Ship  decking,  United  States  Navy  specifications  No.  39  P.  I.  B. : 

4i  by  44  and  smaller  when  not  more  than  1  inch  off  square $100.  00 

31    by    5i    and   smaller    when    difference   between    thickness    and    width    is 

over  1  inch 116.  00 

EXPORT    PRICES. 

[Grading'  as  per  Gulf  coast  specifications  of  1910.] 
PRIME. 

1-inch  random  widths  and  lengths $47.  00 

11-inch  random  widths  and  lengths 52.  00 

li-inch  random  widths  and  lengths 52.  00 

2-inch  random  widths  and  lengths 52.  00 

GENOA    Oil   RIO    PRIME    DEALS, 

3  to  5  inches  thick,  4  to  8  inches  wide,  16  feet  and  up,  to  average  24  feet $32.  00 

3  to  5  inches  thick,  9  to  10  inches  wide,  16  feet  and.  up.  to  average  24  feet 36.  00 

3  to  5  inches  thick,  11  and  12  inches  wide,  16  feet  and  up,  to  average  24  feet 40.  00 

MERCHANTABLE    SAWN    TIMBERS. 

Regular  cubic  average  : 

30    cubic $33.  50 

32|   cubic 35.  00 

35  cubic 36.  50 

37i   cubic 38.  00 

40  cubic 40.  00 

NOTE. — The  southern  yellow  pine  maximum  Government  price  list  for  the  period  from 
midnight  September  23  to  and  including  December  23,  1918,  was  the  same  as  the 
preceding  'price  list  except  in  the  following  particulars  : 

Under  No.  2  common:  1  by  3  flooring  is  changed  to  $26;  1  by  4  flooring,  $25;  1  by  6 
flooring,  $2£  ;  i  by  4  partition,  $26  ;  and  1  by  6  partition,  $27.  For  air-dried  flooring 
$1  per  thousand  feet  is  deducted. 

The  following  prices  for  No,  2  common  are  added  :  li  by  4  to  8  inches,  random,  $31 ; 

11  by  10  and  12  inches,  random,  $33;  li  by  4  to  8  inches,  random,  $31;  li  by  10  and 

12  inches,  random,  $33. 

Under  "  Boards  "  a  price  for  No.  2,  SI  or  2S,  is.  omitted. 

Under  "  Dimension  "  the  price  for  2  by  2,  No.  2  common,  S1S1E  is  increased  to  $26. 
For  merchantable  long  leaf  10  inches  and  under  wide  $3  per  thousand  feot  is  added, 
and  $2  per  thousand  feet  is  added  for  merchantable  long  leaf  12  inches  and  over  wide. 

The  note  under  "  Timbers "  in  the  preceding  list  reading  "Add  for  plank  2  inches 
thick,  cut  full  size,  $1  per  thousand,  to  list  at  3  inches  of  same  width  or  over,"  is 
omitted  from  this  later  list. 

A  price  is  added  of  $3.65  for  No,  1  standard  yellow  pine  lath,  and  $2.65  for  No.  2 
standard  yellow  pine  lath. 


788 


HISTORY   OF   PRICES   DURING   THE   WAR. 


RAILROAD  AND  CAR  MATERIAL. 

Government  yellow  pine  or  southern  yellow  pine  maximum  prices  are  effective  mid- 
night June  14  to  and  including  September  14,  1918,  covering  States  of  Missouri,  Arkansas, 
Texas,  Oklahoma,  Louisiana,  Mississippi,  Tennessee,  Georgia,  Florida,  and  Alabama  : 

FLOORING,  CEILING,  AND  DROP  SIDING,  WORKED  STANDARD  PATTERNS. 

Length  8  to  20  feet.1 


Band 
better, 
heart  rift. 

Band 
better, 
rift. 

B  and 
better. 

No.l. 

No.  2. 

1  by  3  flooring  

$54  00 

$48  00 

$36  00 

$34  00 

*24  50 

1J  by  4  flooring 

66  00 

60  00 

48  00 

1  by  4  flooring  

52  00 

46  00 

34  00 

32  00 

24  50 

1  \  by  4  flooring  

63.00 

57.00 

45.00 

1  by  6  flooring 

36  50 

33  00 

25  50 

1  by  3  to  6  inch  flooring  

25  00 

1  by  4  to  6  inch  flooring  . 

25  00 

f  by  4  ceiling 

32  00 

30  50 

23  50 

f  by  4  ceiling 

35  00 

33  00 

24  50 

fjby  4  ceiling  

40.00 

37  00 

27  50 

l|  by  4  ceiling  .... 

47  00 

43  00 

30  50 

f  by  4  partition 

37  00 

34  00 

I  by  6  partition                   .  . 

39  50 

36  50 

1  by  6  drop  siding 

35  00 

32  50 

26  50 

1  Add  $1  per  thousand  feet  for  specified  lengths. 
ROUGH  BOARDS  AND  FINISH  RANDOM  LENGTHS. 


B  and 
better.2 

"C."» 

No.l 

common.* 

No.  2 
common.  « 

No.  3 
common. 

No.  4 
common. 

by  2... 

$36  00 

$32  50 

$39  00 

$24  00 

by  3 

37  50 

34  50 

30  00 

25  00 

by  4  

35.00 

31.50 

28  00 

23  00 

$20  50 

$14  50 

by  6 

36  50 

33  50 

29  00 

24  00 

20  50 

14  50 

by  8              

36.50 

33.50 

29  00 

25  00 

21  00 

14  50 

by  10  

37.50 

35.00 

29.00 

25.00 

21.00 

14.50 

by  12                    

38.50 

35.50 

32.00 

27.00 

21.50 

14.50 

by  4  to  8  inches  
by  10  and  12  inches  . 

41.50 
43.50 

36.00 
38.00 

by  4  to  8  inches      

41.50 

36.00 

by  10  and  12  inches 

43.50 

38.00 

by  4  to  8  inches.  

41.50 

(5) 

(5) 

(6) 

(5) 

(5) 

by  10  and  12  inches  . 

43.50 

(5) 

(») 

(5) 

(5) 

(*) 

by  4  to  8  inches  

41.50 

(5) 

(5) 

5 

(5) 

(5) 

by  10  and  12  inches 

43.50 

(5) 

(5) 

(5) 

(5) 

(5) 

1  In  all  grades  for  widths  exceeding  12  inches,  including  16  inches,  add  $3  for  each  2  inches  or  fraction 
thereof. 

2  In  grades  B  and  better  and  "C"  for  specified  lengths  up  to  20  feet  add  $1. 

3  In  grades  B  and  better,  "C,"  Nos.  1  and  2  common  for  22  and  24  feet  add  $2. 

« In  grades  No.  1  and  No.  2  common  for  specified  lengths  up  to  20  feet,  except  16  feet,  add  50  cents  a  thou- 
sand; for  16  feet  add  $1. 
6  For  1-inch  common  stock  ordered  kiln  dried  add  $1. 

ROUGH  PLANK  AND  DIMENSION.! 


12,  14,  and 
16  feet. 

10,  18,  and 
20  feet. 

22  and  242 
feet. 

Random. 

2  by  2  No.  1  common     

$24.  00 
22.50 
23.00 
21.50 
22.50 
23.00 
25.00 
22.50 
21.00 
21.50 
20.00 
21.00 
21.50 
23.50 

$26.  00 
23.50 
25.00 
22.50 
24.50 
25.00 
26.50 
24.50 
22.00 
23.50 
21.00 
23.00 
23.50 
25.00 

$27.50 
25.00 
26.00 
24.00 
26.00 
26.50 
28.00 
26.00 
23.50 
25.00 
22.50 
24.50 
25.00 
26.50 

$24.00 
22.50 
23.00 
21.50 
22.50 
23.00 
25.00 
22.50 
21.00 
21.50 
20.00 
21.00 
21.50 
23.50 

2  by  3  No  1  common 

2  by  4  No.  1  common                        .          

2  by  6  No  1  common 

2  by  8^  No.  1  common           .             .         

2  by  10  No  1  common 

2  by  12,  No.  1  common  .               

2  by  2  No  2  common 

2  by  3,  No.  2  common  

2  by  4'  No  2  common 

2  by  8  No  2  common                                                              .  .  .  '.  . 

2  by  10,  No.  2  common  

2  by  12,  No,  2  common 

1  For  2-inch  stock  ordered  kiln  dried  add  $2. 

2  For  lengths  over  24  feet  add  $1  for  each  2  feet  up  to  and  including  32  feet. 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  789 

CAR  SIDING,  LINING  AND  ROOFING  WORKED  TO  M.  C.  B.  PATTERN.! 


- 

5  feet. 

8  feet. 

9  feet. 

10  feet. 

12  feet. 

Random 
lengths 
lining. 

1  by  4  B  and  better  

$36.00 

$35.00 

$39  00 

$38  00 

$37  00 

$34  00 

1  by  6  B  and  better  

36.00 

35.00 

39.00 

38.00 

37  00 

36  50 

1  by  4  ,  No.  1  common  

31.00 

30.00 

34.00 

33  00 

32  00 

32  50 

1  by  6,  No.  1  common  

31.00 

30.00 

34.00 

33  00 

32  00 

33  00 

1  by  4,  No.  2  common 

27.50 

27.50 

27  50 

27  50 

27  50 

24  50 

1  by  6,  No  2  common 

27  50 

27  50 

27  50 

27  50 

27  50 

oc  >;n 

1  In  car  lining  for  specified  lengths  add  $1  per  M  feet. 
STANDARD  GRADE  CAR  DECKING. 

2  by  6  and  8  inches,  9, 10, 18,  and  20  feet,  dressed  to  If  inches $29.00 

2\  by  6  and  8  inches,  9, 10, 18,  and  20  feet,  dressed  to2£  inches 30.00 

3  by  6  and  8  inches,  9, 10, 19,  and  20  feet,  dressed  to  2£  inches 30. 00 


NO. 


COMMON  CAR  DECKING,i  DRESSED  AND  MATCHED  OR  SHIPLAPPED  TO 
M.  C.  B.  PATTERN. 


f 

9  feet. 

9  feet 
6  inches. 

10  feet. 

2  by  6  and  8  inches  

$26  00 

$27  50 

$26  00 

2  by  10  inches       ..           

28  50 

30  00 

28  50 

2J  by  6  and  8  inches 

27  00 

28  50 

27  00 

2*  by  10  inches  

31  00 

32  50 

31  00 

3  by  6  and  8  inches  ... 

26  00 

27  50 

26  00 

3  by  10  inches  

30.00 

31  50 

30  00 

i  For  heart  faced  decking,  6  and  8  inches,  add  $3;  for  10  inches  add  $4. 

CAR  FRAMING,  LONGLEAF  SQUARE  AND  SOUND  GRADES  S4S  TO  i-INCH  SCANT  AND 

CUT  TO  LENGTH. 

Up  to  8  inches,  20  feet  and  under $29. 00 

10  inches ,  20  feet  and  under 32. 00 

12  in ches ,  20  feet  and  under 34. 00 

14  inches,  20  feet  and  under 39.00 

CAR  SILLS. 
For  price  on  car  sills  use  timber  list. 

ROUGH  PLANK  AND  TIMBERS,  NO.  1  COMMON,  CUT  TO  FULL  SIZE.i 


10  to  20 
feet. 

22  and  24 
feet. 

26  feet. 

28  feet. 

30  feet. 

32  feet. 

2  by  2 

$27  00 

$28  00 

$29  00 

$30  00 

$31  00 

$32  00 

2by3  

26.00 

27.00 

28.00 

29  00 

30.00 

31  00 

2  by  4      

26.00 

27.00 

28  00 

29  00 

30  00 

31  00 

2  by  6 

25  00 

26  00 

27  00 

28  00 

29  00 

30  00 

2  by  8  

25.00 

26.00 

27.00 

28.00 

29.00 

30  00 

2  by  10      

29  00 

30  00 

31  00 

32  00 

33  00 

34  oo 

2  by  12 

31  00 

32  00 

33  00 

34  00 

35  00 

36  00 

3  by  4  to  4  by  4  

25.00 

26.00 

27  00 

28  00 

29  00 

30  00 

3  by  6  to  8  by  8 

24.00 

25  00 

26  00 

27  00 

28  00 

29  00 

3  by  10  to  4  by  10 

28  00 

29  00 

30  00 

31  00 

32  00 

33  oo 

5  by  10  to  10  by  10  

27.00 

28.00 

29.00 

30.00 

31.00 

32  00 

3  by  12  to  5  by  12 

30.00 

31  00 

32  00 

33  00 

34  00 

35  00 

6  by  12  to  12  by  12 

29  00 

30  00 

31  00 

32  00 

33  00 

34  00 

3  by  12  to  5  by  14  2  

35.00 

36.00 

37.00 

38.00 

39.00 

40  00 

6  by  14  to  8  by  14  2 

34.50 

35.50 

36.50 

37.50 

38.50 

39  50 

10  by  14  to!4bv  14  2  

34.00 

35.00 

36.00 

37.00 

38.00 

39.00 

1  For  timbers  over  32  feet  add  $1  for  each  additional  foot  in  length  over  32  feet. 
J  For  timbers  over  14  inches  in  width,  add  $3  for  each  2  inches  or  fraction  thereoL 


790 


HISTOEY   OF  PEICES  DURING  THE  WAB. 


GENERAL  EXCEPTIONS. 

[Add  to  foregoing  prices  per  l.OOO  feet  b.  m.] 

Amount 

to  be  added. 

In  No.  1  common  plank  and  timbers  for  long  ieaf__ $2.  00 

Add  to  No.  1  common  long  leaf  for  following  grades  : 

For  sound  and  square  edge 1.00 

For  standard  interstate  rules,  1905,  same  as  No.  1  long  leaf. 

For  merchantable,  1905,  10  inches  and  under 3.  00 

For  merchantable,  1905,  12  inches  and  under 2.  00 

For  prime  interstate  rules,  1905 5.  00 

For  85  to  90  per  cent  cubical  contents  12  inches  and  under 3.  00 

For  85  to  DO  per  cent  cubical  contents  14  inches  and  under 3.  50 

For  85  to  90  per  cent  cubical  contents  16  Laches  and  under 4.  50 

For  heart  face,  1  face  only,  12  inches  and  under 4.  50 

For  heart  face,  1  face  only,  14  inches  and  under 5.00 

For  heart  face,  1  face  only,  16  inches  and  under 6.  00 

For  75  per  cent  heart-girth  measurement  12  inches  and  under 3.  5<> 

For  75  per  cent  heart-girth  measurement  14  inches  and  under 4.  50 

For  75  per  cent  heart-girth  measurement  16  inches  and  under 5.  50 

For  standard  heart  grade  12  inches  and  under 4.  00 

For  standard  heart  grade  14  inches  and  under 5,  50 

For  standard  heart  grade  16  inches  and  under 6.  50 

For  85  to  90  per  cent  facial-area  heart  12  inches  and  under 5.  00 

For  85  to  90  per  cent  facial-area  heart  14  inches  and  under 5.  50 

For  85  to  90  per  cent  facial-area  heart  16  inches  and  under 6.  50 

For  all  heart  12  inches  and  under 7.  00 

For  all  heart  14  inches  and  under 8.  00 

For  all  heart  16  inches  and  under _  10.  00 


For  surfacing  add— 

SIS  or  23. 

S1S1E. 

S4S. 

S2S  and 
T.  and  G. 

Grooved 
for 
splines. 

For  1  inch  or  less 

SO  50 

$0  50 

si  oo 

SI  00 

For  2  inches  or  less  

.50 

1.00 

1  50 

54  oo 

For  3  inches  or  less  

1  00 

1  00 

1  00 

2  00 

4  00 

For  4  inches  or  less  

1.00 

1.00 

1.00 

2  00 

4  00 

For  5  inches  or  less  

1  00 

1  00 

1  00 

2  00 

G  00 

For  6  inches  or  larger 

1  00 

1  00 

1  00 

G  00 

Invoices  shall  be  based  on  actual  board-foot  contents  of  the  rough  size  and  length 
ordered,  except  that  thickness  under  1  inch  shall  be  based  on  1  inch. 

When  stock  ordered  cut  to  odd  length  sufficient  amount  should  be  added  to  price  of 
next  longer  even  length  to  cover  waste  in  cutting  into  odd  lengths. 

Pieces  ordered  larger  at  one  end  than  at  the  other,  or  wider  on  one  side  than  the  other, 
shall  be  computed  as  of  the  larger  end  or  wider  side. 

All  sizes  which  include  fractions  under  one-half  inch  shall  take  the  same  price  as  the 
next  lower  inch  listed.  Sizes  which  include  fractions  one-half  inch  or  over  shall  take 
the  same  price  as  the  next  higher  inch  listed.  Example  :  5|  by  81  would  take  the  price 
of  5  by  10  inches.  Add  $1  to  list  when  ordered  to  cut  on  fractional  size. 

Lengths  which  include  odd  inches  shall  take  the  same  base  price  as  the  next  longer- 
length  listed,  with  allowance  for  odd  lengths  added  (see  general  exceptions).  Example: 
4i  by  8i,  28  feet  6  inches,  would  take  the  base  price  of  4  by  10,  30  feet,  to  which  would 
be  added  the  allowance  for  odd  lengths. 

WESTERN  SPRUCE. 

At  a  conference  of  spruce  manufacturers  of  Washington  and  Oregon  and 
representatives  of  the  Signal  Corps  of  the  United  States  Army,  Aircraft  Pro- 
duction Board,  the  British,  French,  and  Italian  commissions,  and  the  lumber 
committee  of  the  Council  of  National  Defense,  held  in  July,  1917,  the  spruce 
manufacturers  agreed  to  furnish  aircraft  spruce  of  specified  quality  and  size 
during  the  remainder  of  the  year  at  $105  per  thousand  board  feet. 

On  April  10.  1918,  the  spruce  production  division  of  the  Signal  Corps,  United 
States  Army,  issued  a  new  schedule  of  prices  for  western  spruce  and  Port 
Orford  cedar  airplane  material.  The  prices  for  "A"  wing  beam  stock  of 
western  spruce  and  Port  Orford  cedar  was  set  at  $175  per  thousand  board  feet 
f .  o.  b.  mill ;  "  B  "  loi\g  clears  at  $80  per  thousand  board  feet  f .  o.  b.  mill ;  and 
"  C  "  short  and  thin  clears  at  $45  per  thousand  board  feet  f.  o.  b.  mill.  The 
price  for  western  spruce  cants  for  aircraft  material,  grade  1,  was  set  at  $90 
per  thousand  board  feet  f.  o.  b.  mill;  grade  2,  $50  per  thousand  feet  f.  o.  b. 
mill.  These  prices  remained  in  effect  throughout  the  remainder  of  the  year. 


s 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES. 


791 


TREENAILS. 

The  first  control  of  the  price  of  treenails  was  exercised  by  the  Emergency 
Fleet  Corporation  in  the  adoption  of  the  schedule  of  prices  of  April  1,  1918.  This 
schedule  was  revised  on  July  11,  1918,  and  on  July  31,  1918.  The  first  revision 
allowed  an  increase  in  prices  of  30  per  cent  and  the  second  one  of  20  per  cent, 
to  be  retroactive  through  July  12,  1918.  On  November  22,  1918,  again,  the 
schedule  of  July  31,  1918,  was  indefinitely  extended  without  change.1 

[Prices  per  thousand  pieces  f.  o.  b.  shipping  points  fixed  for  black  or  yellow  locust  square  treenails,  pur- 
chased in  IJ-inch  squares  cut  ^  to  &  inch  full  for  use  in  Government  hulls,  inspections  at  cars.] 


APRIL  1,  1918. 


EFFECTIVE  JULY  12,  1918.2 


Lengths. 

Prices. 

Lengths. 

Prices. 

Inches. 

TncJies. 

10 

817.50 

32 

$67.75 

12 

21.25 

34 

74.50 

14 

25.00 

36 

81.  25 

16 

29.00 

38 

88.50 

18 

33.00 

40 

96.00 

20 

37.00 

42 

105.  75 

22 

41.50 

44 

116.25 

24 

46.25 

46 

127.00 

26 

51.  25 

48 

138.  25 

28 

56.25 

50 

150.00 

30 

61.50 

Lengths. 

Prices  li- 
inch 

Lengths. 

Prices  1  J 
inch 

squares. 

squares. 

Inches. 

Inches. 

10 

$20.  70 

32 

$105.  60 

12 

25.20 

34 

116.  40 

14 

29.70 

36 

127.  20  - 

16 

34.20 

38 

138.00 

18 

38.70 

40 

150.00 

20 

43.20 

42 

164.40 

22 

48.60 

44 

181.  20 

24 

72.00 

46 

198.00 

26 

80.40 

48 

216.00 

28 

87.60 

50 

234.00 

30 

96.00 

1  Memorandum  from  the  supply  and  sales  division  of  the  Emergency  Fleet  Corporation. 

2  This  schedule  was  adopted  on  July  31, 1918,  but  was  made  retroactive  to  July  12, 1918. 

NOTE.— Allowance  for  turning  is  $10  per  1.000  pieces  if  single  drift  or  $15  if  double  drift.  Price  for  l\ 
inch  squares  is  $6  per  thousand  pieces  less  than  those  shewn  above.  Intermediate  lengths  at  average  o 
next  highest  and  next  lowest. 


8.  BUILDING  MATERIALS. 


Price  control  was  exercised  over  the  following  building  materials,  other  than 
lumber:  Brick,  gypsum  wall  board,  gypsum  plaster  board,  hollow  building  tile, 
millwork,  Portland  cement,  sand,  gravel  and  crushed  stone.  The  prices  here 
scheduled  applied  only  to  Government  purchases.1 

BRICK. 

The  following  schedule  showing  the  prices  of  brick  fixed  by  the  price-fixing 
committee  was  issued  on  February  26,  1919: 


No. 

Districts. 

Hard- 
burned 
brick. 

Light- 
burned  or 
salmon 
brick. 

Period  covered. 

2 

Metropolitan  New  York 

Per  M. 
$11  50 

Per  M. 

$9  50 

July  1   1918  to  Oct  31   1918 

Do 

12.50 

10.50 

Nov.  1,1918,  to  Nov  30  1918 

4 

Philadelphia  Pa 

16  50 

14  50 

July  1,  1918  to  Oct  31   1918 

Do          

17.50 

15.50 

Nov.  1,  1918,  to  Jan.  31,  1919. 

5 

Washington  DC8 

14  00 

12  00 

July  1,1918,  to  Oct  31   1918 

Do          

15.00 

13.00 

Nov.  1,1918,  to  Jan.  31,  1919. 

5 

Baltimore,  Md      

15.00 

13.00 

July  1  ,  1918,  to  Oct.  31,  1918. 

Do                     

16.00 

14.00 

Nov.  1,1918,  to  Jan.  31,  1919. 

1 

New  England  States 

17.50 

15.50 

New  York  east  of  Mechanicsville  

12.50 

10.50 

S 

New  Jersey  north  of  Trenton  

16.50 

14.50 

Long  Island  NY                     

13.50 

11.50 

>> 

Virginia  3  

Covering  all  allocations  at  tenta- 

Part of  North  Carolina  3            

tive  prices  between  July  1.  1918, 
and  Feb.  27,  1919. 

6 

Southern  States  4 

8 
q 

Western  Pennsylvania  6  
Ohio  e  

16.00 
16.00 

""14."  66" 

10 

Illinois                                            

15.50 

13.50 

12 

Mansfield  Ark 

15.00 

13.00 

Cofleyville  Kans                       

12.00 

10.00 

14 

14.00 

12.00 

16 

St  Louis  Mo                        

16.50 

14.50 

18 

Chicago  111               

I      11.00 

9.00 

\    714.  50 

1  See  report  of  Mr.  Richard  L.  Humphrey,  director  of  the  building  materials  division  of  the  War  Iii- 

2  Price  fixed  on  face  common  brick,  $16,  July  1, 1918,  to  Oct.  31, 1918.    Price  fixed  on  face  common  brick 
$17,  Nov.  1, 1918,  to  Jan.  31, 1919. 

3  Brick  costs  in  group  No.  5  varied  so  greatly  that  it  was  necessary  to  fix  prices  on  individual  plants 
Prices  on  hard  brick  range  from  $11  to  $16;  prices  on  light-burned  or  salmon  brick  range  from  $9  to  $14. 

«  Brick  costs  in  group  No.  6  varied  so  greatly  that  it  was  necessary  to  fix  prices  on  individual  plants. 
Prices  on  hard  brick  range  from  $10.50  to  $18;  prices  on  light-burned  or  salmon  brick  range  from  $8.50  to  $13. 

&  Except  one  plant,  Johnsonburg,  Pa.,  $18.42  for  hard  brick. 

6  Except  one  plant,  Spring  Wells,  Mich.,  $14.50  for  hard  brick  and  $12.50  for  light-burned  or  salmon  brick. 
The  prices  are  all  per  M  brick,  f .  o.  b.  cars,  trucks,  or  barges  at  plants;  an  additional  of  $2  per  M  was  al- 
lowed where  brick  had  to  be  trucked  outside  of  the  plant  to  the  nearest  railroad  siding  or  where  delivered 
over  rail  at  dock.  They  are  based  on  not  less  than  75  per  cent  hard-burned  brick  nor  more  than  25  per 
cent  light-burned  or  salmon  brick. 

*  Sand  lime  brick. 

792 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  793 

GYPSUM  WALL  BOARD  AND  PLASTER  BOARD. 

Pending  the  establishment  of  fixed  prices,  all  orders  were  allocated  at  tenta- 
tive prices. 

On  February  27,  1919,  the  price-fixing  committee  established  the  following 
maximum  prices,  applicable  to  purchases  at  tentative  prices  made  by  Govern- 
ment agencies  during  the  year  1918. 

(GYPSUM   WALL  BOAKD. 

Prices  on  f-inch  thick,  32  and  48  inches  wide,  and  of  varying  lengths,  for  four 
firms,  among  whom  the  orders  were  allocated  at  $22  and  $23.1 

GYPSUM  PLASTER  BOARD. 

Prices  on  f-inch  thick,  32  and  36  inches  wide,  and  varying  lengths,  allocated  • 
among  10  firms  at  prices  ranging  from  $18  to  $28.* 

The  price  for  ik-inch  plaster  board  was  $1  per  thousand  square  feet  less  than 
for  the  f-inch. 

HOLLOW  BUILDING  TILE. 

Prices  of  hollow  building  tile  were  first  fixed  for  the  period  ending  July  1, 
1918,  and  were  advanced  slightly  for  the  period  from  July  1,  1918,  to  January  1, 
1919. 

JULY  25,  1918. 

At  a  meeting  of  the  price-fixing  committee  of  the  War  Industries  Board, 
Thursday,  July  25,  1918,  the  following  prices  for  hollow  building  tile  were 
fixed  for  Government  purchases  made  on  the  tentative  basis  prior  to  July  1, 
1918: 

Per  ton. 

Perth  Amboy,  N.  J $9.00 

St.  Marys,  Pa 7.20 

Canton,   Ohio 6.  75 

Terre  Haute,  Ind 6.75 

Louisville,   Ky 8. 10 

Birmingham,   Ala 8.  55 

Mason  City,  Iowa — i 7.  20 

Coffeyville,  Kans 7.  20 

The  following  tentative  prices  for  Government  purchases,  made  prior  to  July 
1,  1918,  are  to  be  subject  to  final  action  by  the  price-fixing  committee  upon 
presentation  of  additional  data  by  the  Federal  Trade  Commission : 

Per  ton. 

Elmendorf,  Tex $10. 00 

Athens,   Tex 10.  00 

Salt  Lake  City,  Utah 10.00 

Los  Angeles,  Calif 10.00 

Lincoln,    Calif 10.  00 

Seattle,  Wash 10.00 

1  Prices  were  per  thousand  square  feet  f.  o.  b.  cars  at  the  plants  of  the  companies 
named. 


794 


HISTORY   OF   PRICES   DURING   THE    WAR. 


DECKMI5EU    7,    ID  is. 

At  si  meeting  of  the  price-fixing  committee  of  tlie  War  Industries  Board, 
Saturday,  December  7,  1918,  the  following  prices  on  hollow  building  tile  were 
fixed  for  Government  purchases  made  during  the  period  from  July  1,  1918, 
to  January  1,  1919: 

Per  ton, 

Perth  Ainboy,  N.  J $9.  75 

St.  Marys,  Pa 7.95 

Canton,    Ohio 7.  50 

Terre  Haute,  Ind 8.00 

Louisville,   Ky 8. 10 

Birmingham,    Ala 8.  55 

Mason  City,  Iowa 7.  20 

Coffeyville,  Kans 7.  20 

Elmendorf,  Tex 11.00 

Athens,   Tex 11.  00 

Salt  Lake  City,  Utah 10.00 

Los  Angeles,  Calif 10.00 

Lincoln,  Calif 10.  00 

Seattle,  Wash 10.  00 

The  above  prices  are  based  upon  standard,  scored  commercial  kiln  run  tile, 
meeting  the  requirements  of  the  attached  specification.  If  smooth  or  face  tile 
is  required,  there  will  be  an  additional  allowance  of  $1  per  ton.  If  salt-glazed 
tile  is  required,  there  will  be  an  allowance  of  $1.50  per  ton.  If  janib  tile  is 
required,  there  will  be  an  additional  allowance  of  $2  per  ton  on  the  same 
weight  basis  as  the  same  full  size  ordinary  tile.  Fractional  portions  of  ordinary 
tile  shall  carry  the  same  ratio  of  price  of  such  tile  as  that  of  the  fraction 
represented. 

On  the  above  basis,  at  the  points  named  f.  o.  b.  cars  plant  with  present 
rates  of  freight  added,  destination  prices  will  be  figured  subject  to  increases  in 
accordance  with  any  increase  which  may  be  made  in  freight  rates.  Freight 
charges  are  to  be  paid  by  the  purchaser  and  shipments  must  be  consigned  to  a 
Government  officer,  or  if  consigned  to  other  than  a  Government  officer,  must  be 
accompanied  by  a  certificate  (Form  750)  signed  by  a  Government  officer  stating 
that  the  tile  is  for  Government  use  and  that  any  saving  will  accrue  to  the 
benefit  of  the  Government,  otherwise  the  purchaser  must  also  pay  the  war  tax 
on  the  freight  charges.  Shipments  are  to  be  made  freight  collect,  and  for 
convenience  in  billing  invoices  will  be  rendered  on  the  basis  of  the  above- 
named  prices  plus  the  current  freight  rate.  In  payment  of  the  account,  the 
freight  charges  paid  by  the  Government  departments  or  their  contractors  will 
be  deducted  from  the  total  amount  of  the  invoices.  When  shipments  are  re- 
quired freight  prepaid,  Form  750,  furnished  by  the  Commissioner  of  Internal 
Revenue,  must  be  signed  by  the  officer  in  charge  of  the  work  in  question,  and 
forwarded  to  the  shipping  company  with  the  order,  who  will  file  this  certificate 
with  the  railroad  company  at  the  time  the  first  shipment  is  made  on  the  order. 

PARTITION  TILE. 


Basing  weight  (pounds). 

Cells. 

Standard 
•weight. 

Minimum 
weight. 

16  (4  by  12  by  12) 

3 

16 

15 

22<6bv  12  by  12). 

3 

22 

21 

BACK  OF  TILE. 


14  (5  by  8  by  12)... 

16 

15 

8  (4  by  5  by  12) 

9 

8 

HEAVY-DUTY  TILE. 


28  (6  by  12  by  12)  . 

3 

28 

26 

36  (8  by  12  by  12) 

6 

36 

34 

54  (12  by  12  by  12)  

6 

48 

46 

GOVERNMENT   REGULATIONS   RELATING   TO   FRIGES.  795 

The  number  of  cells  and  weight  shown  represent  the  average  commercial 
practice  and  there  shall  be  no  objection  to  a  manufacturer  furnishing  a  larger 
number  of  cells  or  heavier  tile  to  meet  his  local  conditions.  The  standard 
weights,  as  shown,  represent  the  average  weight  of  the  tile  to  be  furnished  but 
tile  of  minimum  weight,  as  shown,  shall  be  accepted,  it  being  understood  that 
this  variation  is  necessary  due  to  wear  and  renewal  of  dies. 

The  basing  weights,  as  shown,  are  for  use  in  reaching  prices  per  thousand 
pieces  on  each  size,  as  shown,  in  connection  with  the  tentative  building  prices  ; 
also  final  prices  when  fixed.  Some  variations  have  been  made  from  actual  and 
average  weight  to  allow  differences  in  cost  of  manufacturing  the  various  sizes 
as  determined  by  the  custom  and  experience  of  the  trade. 

All  tile  to  he  furnished  under  these  specifications  shall  pass  the  following  test 
requirements  for  absorption  : 

Not  less  than  three  test  specimens  shall  be  dried  at  a  temperature  of  approxi- 
mately 212°  Fahrenheit  until  by  weighing  and  reweighing  the  weight  remains 
constant. 

They  shall  then  be  continuously  immersed  in  clear  water  for  a  period  of  48 
hours  with  only  the  upper  surface  of  the  tile  exposed  to  the  air. 

Upon  being  removed  from  the  water  they  shall  be  allowed  to  drain  for  a 
period  of  not  more  than  one  minute  and  the  superficial  water  removed  by  a 
towel  or  similar  means,  and  the  test  specimen  shall  then  be  weighed.  The  ab- 
sorption thus  obtained  shall  not  exceed  an  average  of  10  per  cent  of  the  weight 
of  the  tile  when  dried. 

The  tile  to  be  furnished  is  to  be  commercial  tile  ;  that  is,  it  includes  tile  which 
are  somewhat  cracked,  warped,  and  broken,  not  affecting  the  usefulness  of  flie 
tile.  Inspection  is  to  be  made  at  the  factory. 

MILLWORK. 

On   December   2,   1918,   the  price-fixing   committee   approved   prices   recom- 
mended by  the  director  of  the  building-materials  division  for  all  orders  placed 
during  the  month  of  December  and  expiring  December,  31,  1918.1 
The  schedules  follow: 

MILLWORK. 
December  1,  1918,  to  January  1,  1919. 

GLAZED   WINDOWS   AND   SASH. 

Wood  :  White  pine,  oil  primed,  or  yellow  pine. 

Glass:   S.  S.  B. 

Layout  :  Regular  western  openings. 

Windows  : 

9  by  12  by  iq  inches,  8  light,  Ck.  rail  __________________________________  $1.  67 

10  by  12  by  11  inches,  8  light,  Ck.  rail  ----------------------------------     1-  <39 

9  by  12  by  Ig  inches,  12  light,  Ck.  rail  ---------------------------------     2.10 

9  by  13  by  1|  inches,  12  light,  Ck.  rail  __________________________________     2.  34 

10  by  12  by  If  inches,  12  light,  Ck.  rail  ---------------------------------  2-  1£ 

10  by  14  by  1|  inches,  12  light,  Ck.  rail  ---------------------------------  2.  46 

10  by  15  by  1§  inches,  12  light,  Ck.  rail  ---------------------------------  2.  73 

10  by  16  by  li  inches,  12  light,  Ck.  rail  --------------------------------  £•  »t 

10  by  18  by  1|  inches,  12  light,  Ck.  rail  --------------------------------  S.  28 


10  by  12  by  li  inches,  4  light •  »a 

10  by  12  by  11  inches,  6  light 1-  22 

10  by  14  by  1|  inches,  4  light }•  g£ 

10  by  14  by  lg  inches,  6  light _ -r- J- 34 

10  by  15  by  IS  inches,  4  light 1-19 

10  by  15  by  1|  inches,  6  light 1-40 

10  by  16  by  li  inches,  6  light 1- 50 

10  by  12  by  11  inches,  12  light,  heavy  center  bar ^.  |« 

10  by  14  by  IS  inches,  12  light,  heavy  center  bar ^.  b4 

10  by  15  by  Ig  inches,  12  light,  heavy  center  bar ^.  »7 

10  by  16  by  1|  inches,  12  light,  beavy  center  bar S.rO3 

Cellar  sashj             ^           g             i/g  ^         g 

9  by  12  by  lg  inches,  2  light,  1/11  by  1/5 -62 

10  by  12  by  11  inches,  2  light,  2/1  by  1/5 .65 

8  byy!0  byli  inches,  3  lights,  2/4  by  1/3 .  67 


9  by  12  bv  1|  inches,  3  lights,  2/7  by  1/5 

10  by  12  'by  li  inches,  3  lights,  2/10  by  1/5 


1  Price-Fixing  Committee,  Minute  Book  XI,  Dec.  2,  1918. 


796 


HISTORY   OF  PRICES   DURING   THE   WAR. 


Transoms  : 

2/6  by  1/2  by  1|  inches,  1  light- 
2/8  by  1/2  by  Ig  inches,  1  light- 
2/10  by  1/2  by  11  inches,  1  light 
3/0  by  1/2  by  li  inches,  1  light. 
3/4  by  1/2  b 
2/4  by  1/10  by 
2/6  by  1/10  by  1 
2/8  by  1/10  by  1 
3/0  by  1/10  by  1 
3/4  by  1/10  by  1 


y  li  inches,  3  lights  wid< 
by  Ig   inches,  2  lights  wide. 


4/8  by  1/10  by  li 
5/0  by  1/10  by  1 


inches,  2  lights  wide, 

inches,  3  lights  wide, 

inches,  3  lights  wide, 

inches,  3  lights  wide- 


inches,  5  lights  wide- 
inches,  5  lights  wide. 


5/4  by  1/10  by  1§  inches,  5  lights  wide. 

6/0  by  1/10  by  1|  inches,  6  lights  wide_. 

6/8  by  1/10  by  Ig  inches,  6  lights  wide. 

2/8  by  2/0  by  li  inches,  3  lights  wide__ 

2/10  by  2/0  by  Ig  inches,  3  lights  wide.. 

3/0  by  2/0  by  1|  inches,  3  lights  wide— . 

3/4  by  2/0  by  1|  inches,  3  lights  wide__. 

inches,  5  lights  wide 

inches,  5  lights  wide_. 
inches,  5  lights  wide_. 
inches,  6  lights  -wide-- 
inches, 6  lights  wide__ 


4/8  by  2/0  by 
5/0  by  2/0  by  1 
5/4  by  2/0  by  1 
6/0  by  2/0  by  1 
6/8  by  2/0  by  1 


$0.67 
.72 
.73 
.76 

1.49 
.94 

1.05 

1.  10 
1.16 
1.49 
1.88 

2.  08 
2.  19 
2.  32 
2.99 

1.  16 
1.30 
1.38 
1.74 
2  04 
2.27 
2.28 

2.  75 
3.51 


NOTE; — Other  sizes  of  glazed  sash  not  specified,  will  take  same  basis  as  above,  which 
Is  63|  per  cent  discount  from  the  universal  list. 

EXTRAS. 

The  above  prices  apply  to  goods  in  full-stock  quantities  for  shipment  in  carload  lots. 

For  less  than  carload  shipments  add  10  per  cent  to  cover  extra  handling. 

When  goods  are  packed  for  protection  in  local  shipments!  packing  charges  as  follows 
will  apply : 

Net  per  bundle. 

Under  60  united  inches,  add $0.25 

Over  60  and  up  to  100,  inclusive,  add •  50 

Over  100  united  inches,  add 1*  00 

Skylight  sash,  6/7J   by  5/4J,  3J   inches  thick,  4  lights,  18  by  60,  open    (in  full  car- 
loads), $6.32. 

PANEL  DOORS. 

Wood  :  Pine. 

Layout :  May  be  4  panel,  5  regular  panel,  or  5  cross  panel. 

Sticking :  May  be  O.  G.,  B.  and  C.,  or  C.  and  B. 

Panels  :  Flat  or  beveled  raised. 

Grade  :  May  be  No.  1  and  No.  2  mixed,  about  80  per  cent  No.  1. 


White 
pine. 

Yellow 
pine. 

2/0  by  6/8  by  1|  inches                    

$2.09 

11.88 

2/2  by  6/8  by  If  inches                                                             

2.09 

1.88 

2/4  by  6/8  by  1  finches                                 

2.15 

1.94 

2/6  by  6/8  by  If  inches                                                                  

2.17 

1.96 

2/8  by  6/8  by  1|  inches                           

2.20 

1.98 

2/10  by  6/8  by  1|  inches                                                   

2.50 

2.26 

3/0  by  6/8  by  If  inches  .  .                          

2.66 

2.40 

3/4  by  6/8                                                                             

3.63 

3.27 

3/4  by  6/8  by  If  inches                                                                           

6.31 

4.79 

2/0  by  7/0  by  1|  inches                                                        

2.49 

2.24 

2/6  by  7/0  by  If  inches                                                                               

2.51 

2.27 

2/8  by  7/0  by  If  inches                                      

2.56 

2.31 

3/0  by  7/0  by  If  inches                                                                        

2.75 

2.48 

NOTE.— Doors  of  other  sizes  will  take  the  same  discount  if  standardized  and  ordered  in  quantities.    The 
base  discount  is:  White  pine  doors,  68f  per  cent  from  universal  list;  yellow  pine  doors,  10  per  cent  less. 

Wide  lock  rail  and  ct>t  for  Dutch  door,  add  75  cents  net. 
If  3  foot  4-inch  doors  are  ordered  in  lots  of  less  than  10,  add  20  per  cent. 
If  ordered  in  less  than  carload  orders,  10  per  cent  advance  on  all  items. 
Doors  with  six  panels,  basis  67J  per  cent  from  5X  panel  O.  G.  No.  1  list. 
Doors  made  with  slat  panels,  add  50  cents  net  per  panel. 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES. 


797 


SASH  DOORS. 

Layout :  3X  panel  and  2  lights  or  2  upright  panels  and  4  lights. 

Glazing  :   S.   S.  B. 

Sticking  :  O.  G.,  B.  and  C.,  or  C.  and  B. 

Panels  :  Flat  or  beveled  raised. 

Grade :   No.  1  and  No.  2  mixed,  about  80  per  cent  No.  1. 

Wood  :  Pine. 


White 
pine. 

Yellow 
pine. 

2/4  by  6/8  by  1| 
2/6  by  6/8  by  Ij 
2/8  by  6/8  by  Ij 
2/10  by  6/8  by  1 
3/0  by  6/S  by  l\ 
3/4  by  6/8  by  \\ 
3/4  by  6/8  by  1^ 
2/6  by  7/0  by  Ij 
2/3  by  7/0  by  Ij 
3/0  by  7/0  by  Ij 

inches                                         

$3.22 
3.22 
3.30 
3.63 
3.85 
4.79 
6.47 
3.63 
3.83 
4.24 

$3.01 
3.01 
3.08 
3.39 
3.59 
4.42 
5.91 
3.39 
3.53 
3.96 

inches    ...  

a  inches                                                                                   .  . 

inches                       .         .             

inches 

inches.  ..           ..      .             ,  

inches 

inches  .         ..                

Sash  doors  other  than  above  : 

2/8  by  6/6  by  1-3/8  inches,  2X  panel  or  2  upright  panels  and  6  lights,  SSB 

stops $3.  51 

2/8  by  6/6  by  1-3/8  inches,  2X  panel  or  2  upright  panels  and  9  lights,  SSB 

stops : 4.  51 

2/8  by  6/6  by  1-3/8  inches,  2X  panel  or  2  upright  panels  and  12  lights,  SSB 

stops / 4.  63 

2/8  by  6/6  by  1-3/8  inch  French  doors,  18  lights,  SSB  stops -r     5.  85 

2/8  by  6/6  by  1-3/8  inch  French  doors,  10  lights,  SSB  stops 4.  65 

The  above  prices  are  obtained  by  using  the  panel-door  basis  plus  cost  of  glass  and 
reasonable  profit. 

BATTEN  DOORS. 

Sizes  :  8/0  by  8/0  to  10/0  by  12/0. 
Construction  :  Standard  detail. 

Grade :  Sound  paint  quality,  mixed  woods  permitted. 

Price  :   Doors  with  no  glass,   per   square   foot,   $0.28 ;   glazing,   add  per  light 
10  by  15  or  less,  20  cents  ;  larger  sizes,  extra  price. 

W.  C.  DOORS. 
One  and  one-eighth  inches  thick,  4X  panel,  Nos.  1  and  2 ;  no  lugs  : 


White 
pine. 

Yel'ow 
pine. 

2/0  by  4/0                                                                          

$1.32 

81.19 

2/0  by  4  '6                                                                                                   

1.49 

1.34 

2/4  by  4  '6                                                                                                                  

1.54 

1.39 

2/4  by  4/8                                                                                 

1.82 

1.64 

NOTE.— All  foregoing  prices  apply  to  goods  ordered  in  full-stock  quantities  for  shipment 
in  carload  lots.  For  less  than  carload  shipments,  add  10  per  cent  to  cover  extra  handling. 

Packing  goods  for  protection  on  local  shipments  : 

Panel  doors,  3/0  by  7/0  and  smaller,  add  $0.35  net  per  bundle  ;  larger  than  3/0  by  7/0, 
add  $0.02  net  per  square  foot  S.  M. 

Sash  doors,  3/0  by  7/0  and  smaller,  add  $0.60  net  per  bundle  ;  larger  than  3/0  by  7/0, 
add  $0.03  net  per  square  foot  S.  M. 

HARDWOOD  DOORS. 

Birch  cross  panel,  If  inches,  641  per  cent  discount  from  the  cross  panel  B.  &  C.  uni- 
versal list,  making  a  2/8  by  6/8  door,  $2.57. 
For  two-panel  doors,  add  $0.20  net. 

DOOR  FRAMES. 

All  door  frames  up  to  and  including  2/10  by  6/10  : 

Frame,  detail  "A,"  preliminary  standard  drawings , ?£  ^0 

Frame,  detail  "  B,"   preliminary  standard  drawings 2.  42 

Frame,  detail   "  C,"   preliminary   standard  drawings , ^-  it 

Frame,  detail   "  B,"   preliminary   standard  drawings l.  2d 


798  HISTORY  OF   PRICES   DURING   THE   WAR. 

SILLS  AND   SLIDES. 

Cantonment  sills,  26  cents  net  per  piece. 
Cantonment  slides,  171  cents  net  per  piece. 

NOTE. — The  above  prices  apply  to  goods  in  full  stock  quantities  for  shipment  in  car- 
load lots.  For  less  than  carload  shipments,  add  10  per  cent  to  cover  extra  handling. 

Prices  all  apply  f.  o.  b.  mills  in  South  or  Middle  West.  Prices  f.  o.  b.  Pacific  coast 
mills  should  be  lower  than  this  basis,  except  possibly  on  glazed  windows,  but  proper 
differentials  have  not  been  worked  out  for  shipments  from  points  east  of  Chicago  or  west 
of  Mississippi  River.  Differentials  above  mill  prices  will  have  to  be  worked  out  based  on 
freight  costs. 

FRAMES. 

Box  window   frames   for   brick,  K.   D.  :   9   by   12,   12  lights,   2/7J.   by   4/6 — Basis  : 

$86  per  1,000  feet  b.  m.  exposed  parts  and  $75  for  unexposed _  $2  55 

Add  for  pulleys,  $0.24. 

Extra  :  15  cents  net  for  putting  boxes  together,  balance  K.  D. 

Casement  frames,  brick  wall:  2/OJ  by  3/5J 88 

D.  C.  window  frames,  type  "A"  :  2/7^  by  4/6 2  09 

Add  for  pulleys,  $0.24. 

D.  C.  window  frames,  type  "  B  "  :  2/7?.  by  4/6 1  QQ 

Add  for  pulleys,  $0.24.       . 

Cellar  frames  "  A  "  :  8  by  10,  6  lights,  opening  2/4*  by  2/1J .  91 

Casement  frames,  open  in  "B  "  :  8  by  10,  6  lights,  opening  2/4|  by  2/15 l' 44 

Casement  frames,  open  out  "  C  "  :  10  by  12,  6  lights,  opening  2/0}  by  3/5£ 1.  71 

Casement  frames,  open  out  "  D  "  :  Opening  2/OJ  by  3/5J 1.37 

Casement  frames,  for  brick,  "  E  "  :  Opening  2/OJ  by  3/5! 1.18 

Louvre  frames  :  Half  circle,  2/6  by  1/3  opening,  circle  0/S,  square  1/8 3.  07 

No  wire  screens  or  hinges. 

Rectangular  louvre  frames:  1/2  by   2/4 1.60 

Louvre  frames,  peaks  :  3/0  by  1/6 2.  43 

K.    D.    WINDOW  FRAMES. 

Special  prices  for  cantonment  construction  : 

Quality :   Sound  mixed  woods  for  paint. 

Construction  :  Pulley  stiles,  If  by  4  ;  blind  stops,  }$  by  If  ;  casing,  }f  by  32  ; 
sill.  Is  by  3H  ;  plain  drip  cap.  ||  by  li  ;  mullioni  5J.  No  pockets  or  pulleys 

10  by  12  to  10  by  15  and  10  by  16,  12  lights,  single $1.  50 

10  by  12  to  10  by  15  and  10  by  16,  12  lights,  double 3  10 

10  by  12  to  10  by  15  and  10  by  16,  12  lights,  triple 4'  70 

10  by  12  to  10  by  15  and  10  by  16,  12  lights,  quadruple Q.  30 

For  li  O.  8.  casing,  add  to  base  price  per  frame .  15 

For  pockets  and  pressed  steel  pulleys,  per  frame .  30 

For  Ig  sill,  per  frame .  10 

For  51  stud  wall,  per  frame .  20 

For  5|  jambs  for  plastered  wall,  per  frame .  10 

K.    D.    OUTSIDE    DOOR    FRAMES. 
Jambs,  li  by  41,  not  rabbeted;  stops,  5  by  1|  S4S  ;  casing,  {%  by  31  ;  no  sill. 

Sizes  2/4  by  6/8  to  3/0  by  7/0  K.  D _  $1.  50 

For  larger  sizes,  for  every  4  inches  in  width  or  height,  add .  l() 

For  soft-wood  sill,  add  to  base  price , .  no 

For  52  stud  wall 30 

For  transom  head  2/0  high  or  less,  add  to  base  price .'  75 

All  f.  o.  b.  factories  in  the  Middle  West.  Taking  rates  to  eastern  and  southern  points 
not  in  excess  of  the  rates  from  Oshkosh,  Wis.,  Minneapolis,  and  Dubuque,  Clinton,  and 
Muscatine,  Iowa. 

EXTRAS. 

The  above  prices  apply  to  goods  in  full  stock  quantities  for  shipment  in  carload  lots. 
For  less  than  carload  shipments,  add  10  per  cent  to  cover  extra  handling. 

STAIRS. 

Plain  box  stairs,  3/0  wide,  K.  D.  : 

Strings  stuck  to  match  room  base. 

Strings  house  g  inch  thick. 

Treads  li  inches  thick,  risers  If  inch  thick. 

No  rough  horses,  newels,  rails,  or  balusters,  $1.10  per  riser. 

If  winders  are  shown,  figure  same  as  an  extra  riser. 
Open  stairs,  3/6  wide,  K.D. : 

Wall  string  housed  1  inch  thick. 

Face  string  cut  and  mitered,  i  inch  thick. 

Treads  1J  inches  thick,  mitered  and  arranged  for  balusters. 

Nosings  fitted,   coves  loose. 

Risers  (i  inch  thick)  mitered,  $1.35  per  riser. 
If  winders  are  shown,  figure  same  as  an  extra  riser. 

Stair  rail  "A"  with  fill<»t__                                                                                        __:  $0  12i 

Stair   rail   "B"   with   fillet "II"__I_I_I"I  .11 

Wall  rail,  1|  inches  round  (no  brackets) per  linear  foot .  06 

Balusters   as   shown   detail    "C" net .OS 

Balusters  as  shown  detail  "  D  " do .  05 

Starting    newels,    type   "  F  " each__  1.50 

Starting  newels,    type   "G" do 1.00 


GOVERNMENT  REGULATIONS  RELATING  TO   PRICES.  799 

Plain  curb  string  same  as  for  open  stairs. 

Paneled  string  as  shown,  $1.65  per  riser. 

Well-hole  skirting,  figure  on  molding  basis. 

(Type  numbers  taken  from  preliminary  details.) 

Prices  above  will  cover  yellow  pine  or  white  pine  for  paint. 

MOLDINGS. 

Per  1,000 

Yellow  pine  or  soft  wood  for  exterior  based  on  finished  product :  b.  m. 

All  moldings  worked  from  1-inch  stock $79.  20 

All  moldings  worked  from  1J  or  li  inch  stock 85.  8<» 

All  moldings  worked  from  2-inch  stock 92.  40 

Hardwood  moldings: 

Gum  worked  from  1-inch  stock 93.  50 

Calico  ash,  worked  from  1-inch  stock 1 112.  20 

Plain  oak,  worked  from  1-inch  stock 126.  50 

Brown  ash,  worked  from  1-inch  stock 126.  50 

All  moldings  using  thicker  stock  will  "be  based  at  higher  prices,  according  to  market 
prices. 

Special  prices  for  cantonment  construction,  on  lattice  I  by  11  inches,  44  cents  per 
100  linear  feet. 

Porch  rails  :  On  molding  basis. 

Porch  brackets :  Sawn  to  shape,  $100  per  1,000  b.  m. 

Porch  panels,  20  cents  per  square  foot,  depending  upon  design. 

Interior  frames  :  Inside  jambs,  based  on  molding  prices  plus  2J  cents  net  each  for 
gaining  side  jambs  to  receive  head. 

Exterior  blinds :  1|  inches  thick,  stationary  slats,  28  cents  net  per  linear  foot  in 
height  with  a  minimum  price  of  $1  per  pair. 

Exterior  paneled  shutters  :  1J  inches  thick,  stock  construction,  35  cents  net  per  linear 
foot  in  height,  not  exceeding  2/10  i  in  width. 

Exterior  porch  columns  or  newells  :  Built  up,  square,  $120  per  1,000  feet  b.  m.  plus 
cap  and  base  on  molding  basis. 

Exterior  porch  newels  or  columns :  Solid  S4S,  $80  per  1,000  feet  b.  m. 

NOTE.— Above  prices  apply  to  goods  in  full  stock  quantities  for  shipment  in  carload 
lots.  For  less  than  carload  shipments,  add  10  per  cent  for  extra  handling. 

INTERIOR  TRIM. 

Special  prices  for  cantonment  construction  : 
Wood  :  Yellow  pine  and  white  pine. 
Manufactured :  Machine  run  out  of  rough  lengths. 
Casing  :  13/16  by  33,  S4S. 
Stool :  2  by  13. 
Apron:  13/16  by  31. 
Stops  :  i  by  |. 

Window  trim  : 

10  by  12  to  10  by  15,  12  lights  per  side $0.  55 

10  by  16  to  10  by  18,  12  lights  per  side .  66 

Sash  trim  : 

10  by  12  to  10  by  16,  4  and  6  lights  per  side .  30 

Door  trim  : 

2/0  by  6/8  to  3/0  by  7/0  per  side -  40 

IJ/4  by  6/8  to  5/0  by  7/0  per  side .  55 

For  transom  head  2/0  or  less,  add •  IS 

Inside  jambs:   Manufactured,   run   to  exact  widths  and  lengths   and  dadoed;   shipped 
K.  D. ;  stops  cut  to  rough  lengths ;  no  transom  heads : 
Wood :  Yellow  pine. 
Parts :  Jambs  13/16  by  44  ;  stops  £  by  Ig. 

2/8  by  6/8  to  3/0  by  7/0 $0.  77 

3/4  by  6/8  to  6/0  by  7/0 .  SS 

For  transom  head  2/0  or  less,  add •  K 

EXTRAS. 

Above  prices  apply  to  goods  in  full  stock  quantities  for  shipment  in  carload  lots. 
For  less  than  carload  shipments,  add  10  per  cent  for  extra  handling. 

All  f.  o.  b.  factories  in  the  Middle  West,  taking  rate  to  eastern  and  southern  points 
not  in  excess  of  the  rates  from  Oshkosh,  Wis.,  Minneapolis,  Dubuque,  Clinton,  and 
Muscatine,  Iowa. 

Medicine  cabinets : 

Stock  design,  arranged  to  fit  in  recess  or  hang  on  wall,  plain   (window  glass) 

mirror  14  by  18,  set  up,  no  hardware $3-  50 

As  per  standard  detail,  plain  plate  mirror o.  WJ 

Kitchen  dressers  :  No.  1,  sheet  58,  3/6  by  6/9  bottom  case  18  inches  deep,  top  case 

14  inches  deep,  K.  D.  ;  no  hardware 13.  70 

(June,  1918.) 

Prices  on  pine  lath,  f.  o.  b.  shipping  point  :  No.  1,  $3.65  ;  No.  2,  $2.65. 
Xpevial  millwork  — Prices  of  roofers  :   Beaded,   $2  per  thousand  feet,  overdressed  two 
sides ;  grooved,  $1  per  thousand  feet,  overdressed  two  sides. 


800 


HISTORY   OF   PRICES   DURING  THE  WAR. 


PORTLAND  CEMENT. 

The  cement  committee  of  the  Council  of  National  Defense  was  organized 
In  April,  1917.  In  July,  1917,  an  informal  price  agreement  was  made  for  the 
last  six  months  of  1917,  applying  principally  to  purchases  by  the  Army  and  the 
Navy. 

By  the  recommendation  of  the  War  Industries  Board,  these  prices  were  con- 
tinued for  Government  purchases  through  the  first  four  months  of  1918. 

On  May  4,  1918,  the  price-fixing  committee  issued  new  schedules  allowing 
increases  in  prices.1  These  prices  were  left  substantially  the  same  at  the 
revision  of  August  23,  1918,  until  December  31,  1918,  when  price  control  ended. 

NET  PRICES  ESTABLISHED  BY  PRICE-FIXING  COMMITTEE  FOR  PORTLAND  CEMENT 
PER  BARREL  F.  O.  B.  CARS  LOCATION  NAMED,  FOR  4-MONTH  PERIODS  ENDING  AS 
INDICATED. 


Location. 

4  months  ending- 

Dec.  31, 
1917- 
Apr.  30, 
1918.1 

Aug.  31, 
1918.1 

Dec.  31, 

1918.2 

Hudson,  N.Y  .          .                ... 

81.40 
1.30 
1.50 
1.40 
1.40 
1.40 
1.50 
1.50 
1.50 
1.50 

$1.85 
1.75 
1.75 
1.70 
1.65 
1.65 
1.80 
1.70 
1.60 
1.70 
1.70 
1.70 
1.70 
1.75 
1.70 
1.80 
1.95 
1.95 

$1.82 
1.72 
1.72 
.67 
.62 
.62 
.77 
.67 
.57 
.67 
.67 
.67 
.67 
.72 
.67 
.77 
.92 
.92 

Lehigh  Valley,  Pa  (Northampton) 

Pittsburgh.  Pa.  (Universal)  

Fordwick,  Va                ... 

Kingsport.  Tenn  . 

Richard  City,  Tenn  .    ... 

Bellevue,  Mich 

Mitchell,  Ind    

Buffington.  Ind 

Hannibal,  Mo  

LaSalle,lll  

Steelton,  Minn  

1.55 
1.55 
1.50 
1.30 
1.40 
1.90 

Mason  City,  Iowa 

lola,  Kans  

Harrys,  Tex 

Houston,  Tex  

El  Paso,  Tex 

San  Antonio,  Tex  

New  Orleans,  La  

1.78 

Trident,  Mont  

1.70 
1.70 

1.90 
1.75 
1.90 
1.90 
1.90 
1.95 
1.95 

.87 
.72 
.87 
.87 
.87 
.92 
.92 

Portland,  Colo 

Devils  Slide,  Utah  

Brigham,  Utah 

Salt  Lake  City,  Utah  

Irwin,  Wash       

1.70 

Concrete,  Wash  

Seattle,  Wash             .         .  . 

1.90 
1.70 
1.70 

Tacoma,  Wash  

Portland,  Oreg  :  

Oswego,  Oreg  

2.00 

1.97 

Stockton.  Calif        .  .  ,  

1.70 
1.70 
1.70 
1.70 
1.70 

Oakland,  Calif 

San  Francisco,  Calif 

Santa  Cruz,  Calif 

Santa  Barbara,  Calif  

Los  Angeles,  Calif  

1.70 

Cement,  Calif  

1.95 
1.95 
1.95 

1.92 
1.92 
1.92 

Davenport,  Calif                                                                                               '• 

Crestmore,  Calif  

1  Includes  3  cents  per  barrel  for  bin  inspection. 

2  Does  not  include  charge  for  bin  inspection. 

On  the  above  basis,  with  freight  added,  prices  were  to  be  named  f.  o.  b.  cars  at  desti- 
nation, based  upon  current  rates  of  freight,  subject  to  increase  in  destination  prices  in 
accordance  with  any  increase  which  might  be  made  in  freight  rates.  The  freight  charges 
were  to  be  paid  by  the  purchaser  and  shipments  to  be  consigned  to  a  Government  officer, 
or,  if  consigned  to  other  than  a  Government  officer,  to  be  accompanied  by  a  certificate 
(Form  750)  signed  by  a  Government  officer,  stating  that  the  cement  was  for  Government 
use,  and  that  any  saving  would  accrue  to  the  benefit  of  the  Government,  otherwise  the 
purchaser  must  also  pay  the  war  tax  on  the  freight  charges.  Shipments  were  to  be  made 


1  Price-fixing  committee,  Minute  Book  III,  May  4,  1918. 


GOVERNMENT   REGULATIONS   RELATING  TO   PRICES.  801 

freight  collect,  and,  for  convenience  in  billing,  invoices  were  to  be  rendered  on  the  basis 
of  the  above-named  prices,  plus  the  current  freight  rate.  In  payment  of  the  account  the 
freight  charges  paid  by  the  Government  departments  or  their  contractors  was  to  be 
deducted  from  the  total  amount  of  the  invoices.  When  shipments  were  required  freight 
prepaid,  Form  750,  furnished  hy  the  Commissioner  of  Internal  Revenue,  were  to  be  signed 
by  the  officer  in  charge  of  the  work  in  question  and  forwarded  to  the  shipping  company 
with  the  order,  who  would  file  this  certificate  with  the  railroad  company  at  the  time  the 
first  shipment  was  made  on  this  order. 

The  prices  in  the  above  table  did  not  include  any  charge  for  cotton  cloth  and  paper 
bags,  paper-lined  cloth  bags,  or  wooden  barrels.  The  charges  were  as  follows : 

For  the  last  six  months  of  1917  and  the  first  four  months  of  1918,  no  charge  was  made 
for  cloth  bags  at  the  time  of  shipment,  but  any  bags  not  returned  to  the  mill  in  good 
condition,  freight  prepaid,  were  charged  for  at  the  rate  of  15  cents  each ;  for  the  four 
months  beginning  May  1,  1918,  a  charge  of  10  cents  for  each  cloth  bag  was  made  at  the 
time  of  shipment,  which  amount  was  credited  upon  return  of  these  bags  in  good  condi- 
tion to  the  point  of  shipment,  freight  prepaid,  within  60  days  from  date  of  shipment ; 
for  the  four-month  period  beginning  September  1,  1918,  a  charge  of  25  cents  for  each 
cloth  bag  was  made  at  the  time  of  shipment  which  amount  was  credited  for  each  bag 
returned  to  the  point  of  shipment  in  good  condition,  freight  prepaid,  within  60  days  from 
the  date  of  shipment.  This  increase  in  the  charge  for  cloth  bags  was  due  to  the  increas- 
ing shortage  resulting  from  inability  to  obtain  new  bags  or  to  secure  the  return  of  bags 
at  the  lower  charges  of  10  and  15  cents  when  the  replacement  value  was  upwards  of  25 
cents  per  bag. 

The  charge  for  paper  pags  was  as  follows : 

The  last  six  months  of  1917  and  the  first  eight  months  of  1918,  2|  cents  per  bag ;  the 
last  four  months  of  1918,  7£  cents  per  bag. 

The  additional  charge  for  paper-lined  cloth  bags  for  the  last  six  months  of  1917  and 
the  first  four  months  of  1918  was  15  cents  per  bag  for  the  lining  and  15  cents  for  each 
cloth  bag1,  which  latter  amount  was  credited  upon  the  return  of  each  cloth  bag  in  good 
condition  to  the  point  of  shipment,  freight  prepaid,  within  60  days  from  the  date  of 
shipment. 

The  charge  for  wooden  barrels  for  the  last  six  months  of  1917  was  45  cents,  and  for 
the  first  four  months  of  1918  was  60  cents  per  barrel  for  eastern  mills,  and  for  both 
periods  75  eents  per  barrel  for  western  mills. 

The  prices  fixed  for  the  last  four  months  of  1918  contained  the  provision  that  the 
charge  for  paper-lined  cloth  bags  or  wooden  barrels  (based  on  the  cost)  would  be  deter- 
mined at  the  time  the  order  was  placed. 

Previous  to  September  1,  1918,  the  cost  of  bin  inspection  was  included  in  the  price 
of  cement.  Inasmuch  as  all  departments  did  not  require  bin  tests,  this  charge  was  de- 
ducted from  the  prices  fixed  for  the  second  four  months  of  1918,  making  the  net  prices 
established  for  the  last  four  months  3  cents  per  barrel  less  than  those  for  the  previous 
period.  A  charge,  howeyer,  of  3  cents  per  barrel  was  made  where  bin  inspection  was 
required,  which  requirement  was  usual  with  nearly  all  Government  purchases. 

Prices  for  the  four-months'  period  beginning  May  1,  1918,  were  15  cents  per  barrel 
less,  and  for  the  four-months'  period  beginning  September  1,  1918,  5  cents  per  barrel 
less,  where  the  cement  was  shipped  in  bulk. 

The  terms  were  net  cash  30  days ;  for  the  four-month  period  beginning  May  1,  1918,  a 
discount  of  5  cents  per  barrel  was  allowed  for  cash  payments  in  10  days.  This  provision 
did  not  prove  practicable  and  was  not  included  in  prices  for  subsequent  periods. 

SAND,  GRAVEL,  AND  CRUSHED  STONE. 

The  first  prices  were  fixed  for  the  New  York  district  by  the  price-fixing  com- 
mittee July  10,  1918,  effective  to  November  1,  1918.  Prices  for  other  districts 
followed  later,  and  all  expired  on  November  1,  1918. 

(July  10,  1918.) 

NEW    YORK    DISTRICT. 

After  considering  data  submitted  by  the  Federal  Trade  Commission  and  in 
agreement  with  the  representatives  of  the  industry,  the  price-fixing  committee 
has  fixed  the  following  prices  on  sand,  gravel,  and  crushed  stone : 

Per 
cubic  yard. 

Sand $0.  75 

Gravel    1. 60 

Crushed  stone 1.  85 

125547°— 20 51 


802  HISTOKY  OF  PEICES   DURING   THE   WAR. 

These  prices  are  for  full  scow-load  lots  delivered  f.  o.  b.  scow,  within  the  free 
lighterage  limits  of  the  port  of  New  York,  with  24-hour  unloading1  privilege, 
and  are  effective  for  the  period  ending  October  31,  1918.  For  deliveries  made 
outside  the  free  lighterage  limits  of  New  York  may  be  added  to  the  above 
prices  the  extra  cost  of  towage. 

(Aug.  28,  1918.) 

METROPOLITAN'    PHILADELPHIA    DISTRICT. 

At  a  meeting  of  the  price-fixing  committee,  held  on  Tuesday,  August  28,  the 
following  maximum  prices  were  fixed  upon  all  Government  sales  effective  for 
the  period  ending  December  31,  1918,  for  the  Metropolitan  Philadelphia  dis- 
trict; that  is,  for  the  States  of  New  Jersey,  Delaware,  and  Pennsylvania  east  of 
and  including  Harrisburg: 

For  deliveries  in  full  scow-load  lots,  f.  o.  b.  scow  alongside,  within  the 

second  towing  zone :  .  Per  ton- 

Sand $0.  60 

Gravel 1.00 

Crushed  gravel  f.  o.  b.  cars  wharf ^ 1.  25 

Unloading  sand  and  gravel  from  scow  to  cars .  25 

For  deliveries  f.  o.  b.  cars  plant : 

Sand .  55 

Gravel .95 

For   deliveries   in   full   scow-load    lots   between   Marcus   Hook   and   Port 
Penn  on  the  Delaware  River  f.  o.  b.  alongside : 

Sand 1.  00 

Gravel 1.15 

The  above  carried  a  24-hour  free  unloading  privilege,  with  a  flat  charge  of 
$15  per  scow  for  each  24  hours  thereafter. 

(Oct.  31,  1918.) 

NORFOLK    DISTRICT. 

At  a  meeting  of  the  price  fixing  committee  held  on  Thursday,  October  31,  the 
following  maximum  prices  were  fixed  to  cover  purchases,  whether  by  the  Gov- 
ernment or  otherwise,  and  to  be  effective  for  the  period  ending  February  28? 
1919,  for  the  Norfolk  district,  i.  e.,  the  State  of  Virginia  south  of  and  including 
Petersburg,  and  the  States  of  North  Carolina  and  South  Carolina  : 

For  deliveries  in  full  barge  lots,  f.  o.  b.  point  of  origin,  or  f.  o.  b.  cars  plant, 
per  ton  of  2,000  pounds  net : 

Sand__  $0.  50 

Gravel •  9E 

Crushed  stone 

Crushed  granite !•  15 

Not  including  railroad  ballast  or  screenings. 

(Nor.   7,   1918.) 
METROPOLITAN    PHILADELPHIA    DISTRICT. 

At  a  meeting  of  the  price  fixing  committee  held  on  Thursday,  November  7, 
a  maximum  price  of  $1.50  per  ton  (2,000  pounds)  f.  o.  b.  cars  plant  was  fixed 
for  all  Government  purchases  of  crushed  stone  (other  than  railroad  ballast  or 
screenings)  for  the  period  ending  December  31,  1918,  within  the  Metropolitan 
Philadelphia  district,  i.  e..  for  the  State  of  New  Jersey,  south  of  and  including 
Trenton;  the  State  of  Delaware  and  the  State  of  Pennsylvania,  east  of  and 
including  Harrisburg. 


9.  CHEMICALS. 


The  following  table  summarizes  the  essential  facts  concerning  the  public 
regulation  of  the  prices  of  chemicals  during  the  war.  The  more  detailed  regu- 
lations pertaining  to  the  great  groups  of  chemicals  are  shown  after  the  summary 

table. 


Commodities. 

Agency. 

Date  when  effec- 
tive. 

Date  of  expira- 
tion. 

Price. 

Acids 

P   F.C 

F.  o.  b.  works. 

$18  per  short  ton. 
$28  per  short  ton. 
$32  per  short  ton. 
$16  per  short  ton. 
$25  per  short  ton. 
$28  per  short  ton. 

8|  cents  per  pound. 

$6.90  per    hundred- 
weight, 
$13.10  per  hundred- 
weight. 

$0.0235  per  pound. 

$0.  15  per  pound. 
$0.17  per  pound. 

$0.145  per  pound. 
$0.165  per  pound. 
$3.50     per     hundred- 
weight f.  o.  b.  cars  at 
sellers  'plants. 
$0.075  per  pound. 
$1.57     per     hundred- 
weight f.  o.  b.  sellers' 
plants. 

$0.30  per  pound,  carload 
lots. 
$0.0825  per  pound,  car- 
load lots. 
$0.045  per  pound  f  .  o.  b. 
point  of  production. 
$0.09  per  pound,  carload 
lots  f.o.b.  plants. 
$3.50  per  bushel  of  46 
pounds. 
$4.50  per  bushel  of  46 
pounds. 
$3.50  per  bushel  of  46 
pounds  from  near-by 
countries;  $4.50  from 
other  countries. 
$4.50  from  all  sources. 

$0.244  per  pound. 
$0.224  ner  nound. 

Sulphuric  acid  

June  28,  1918.... 

Jan.  1,1919  

60°  Baum<5 

66°  Baume". 

20  per  cent  oleum  . 
60°  Baume"  

Sept.  30.  1918... 

66°  Baume* 

do 

20  per  cent  oleum. 
Nitric  acid— 
42°  Baume" 

do.    ... 

June  28,  1918.... 

Jan.  1,  1919  
do  

Mixed  acids- 
No.  1...  . 

No.  2  

Alkalis: 
Bleaching  powder  

Carbon  tetrachloride. 
Dry 

Board     of    ap- 
praisers. 
W.  I.  B.,  infor- 
mal. 

April,  1918  
do  . 

Nov.  25,  1918.... 

Fire  extinguisher  . 

Carbon  tetrachloride  . 
Dry 

Board    of    ap- 
praisers. 

August,  1918... 

December,  1918  . 

Fire  extinguisher  . 
Caustic  soda,  76  per 
cent. 

Chlorine  liquid 

W.  I.  B.,  infor- 

mal. 

do 

Spring,  1918.  .  .  . 
May  1918 

December,  1918  . 

Nov.  25,  1918.  .  . 
do  

Soda  ash,  58*per  cent 

do 

do  

Ammonia  ...          .  . 

Food    adminis- 
istrator. 

Nov.  19,  1917.. 

Anhydrous  .  .  . 

Aqua  

Ammonium  sulphate  
Arsenic 

War       Depart- 
ment. 
Food    adminis- 
trator. 

December,  1917.. 
Feb  28  1918 

Dec.  14,1918  

Castor  beans  

Fall,  1917  

December,  1918. 

Castor  oil 

October  1918 

W.  T.  B  

February,  1918.. 
October  1918 



Bureau  Aircraft 
Production. 

Fall  1918 

December,  1918.. 

Conforming  to  Speci- 
fication No.  3500-A 
of  Signal  Corps. 
Other  oil... 

803 


804 


HISTORY  OF   PRICES   DURING   THE   WAR. 


Commodities. 

Agency. 

Date  when  effec- 
tive. 

Date  of  expira- 
tion. 

Price. 

Glycerin  

Fo«d     adTn'fiis- 

July  30  1918 

F.  o   b   points  of  pro- 

istrator. 

August—  Septem- 

duction. 
$0.60  per  pound 

ber. 
o  p  toher—N  o  vein- 

$0.58  per  pound 

ber. 
December. 

$0.56  per  pound 

Nitrate  of  soda 

Nitrate  commis- 

sion. 

January—  J  une  , 

nitrate.        nitrate. 

Percwt.        Per  CLct. 

$4.22.5              $4.25 

1918. 
June,  1918  

4.05                4.10 

July  1918 

4.  10                4  20 

August,  1918.   .. 

4.32.',               4.45 

September  1918 

4.32^               4  50 

October-Novem- 

4.40               4.523; 

ber,  1918. 
December,  1918.. 

4.42£               4..~>n 

Quebracho 

W   T.  B 

May  6  1918 

July  10  1918 

$0  065  per  pound 

Smokeless  cannon  powder 

Congress  

Feb.  13,  1913... 

$0.53  per  pound. 

Sulphur 

W.  I.  B.  infor- 

June 7  1918 

Dec  31   1918 

$22  per  long  ton  f  o  )  ». 

Toluol  

mal. 
Ordnance     De- 

Feb. 1,  1918... 

mines. 
$1.50  per  gallon. 

partment. 
W.  I.  B.,  infor- 

June, 1918. 

Do. 

Wood  chemicals  

mal. 
W.  I.   B.   with 

Dec.  14,  1918.. 

F.  o.  b.  shipping  point. 

Acetate  of  lime  

War    Depart- 
ment. 

Dec.  24,  1917.  .  . 

$0.04  per  pound. 

Acetic  acid,  commer- 

Feb. 13,  1918  

$0.14f  per  pound. 

cial,  100  per  ent. 
Acetic  acid,  glacial 

do 

$0  19  per  pound. 

Acetic  anhydride,  85 

Dec.  24,  1917  

$0.85  per  pound. 

per  cent. 
Acetone 

do 

Alcohol,  methyl,  pure 

do 

$0  86  per  gallon. 

Alcohol.  wood- 
Crude  . 

do 

$0  50  per  gallon 

Denaturing  grade 

do. 

$0.79  per  gallon. 

Refined,   95  per 

.  ..do  

Do. 

cent. 
Refined,   97   per 

.do  

$0.82  per  gallon. 

cent. 
Ethyl  me  thy  Ike  tone  . 

do... 

$0.25£  per  pound. 

Formaldehyde  
Methyl  acetate 



Feb.  12,  1918.... 
Feb  20  1918 



$0.15|  per  pound. 
$0  21  naked  at  plant 

Meth  vl  acetone  

Dec.  24,  1917  

$0.86  per  gallon. 

Wool  grease  

P.  F.C  

Sept.  17,  1918.... 

Dec.  17,  19*18'.  .  .  . 

$0.16  per  pound  f.  o.  b. 
shipping  point. 

ACIDS. 

On  June  28,  1918,  the  price  fixing  committee  announced  the  following  maxi- 
mum prices  of  sulphuric  and  nitric  acids,  which  were  revised  on  September  30, 
1918.  Control  was  lifted  on  January  1, 1919. 

June  28,  1918. 

Sulphuric  acid:                                                                                      Per  ton  of  2,000  pounds. 
60°   B__  $18 

66°   B 28 

1*0  per  cent  oleum 32 

F.  o.  b.  at  manufacturers'  works  in  sellers'  tank  cars. 

In  carboys  in  carload  lots  one-half  cent  per  pound  extra. 

In  carboys  in  less  than  carloads  three-fourths  cent  per  pound  extra. 

In  drums,  any  quantity  ,one-fourth  cent  per  pound  extra. 

Nitric  acid,  42°  B.,  8J  cents  per  pound  f.  o.  b.  manufacturers'  works  in  carboys. 

A  schedule  of  maximum  prices  on  mixed  acids  was  prepared  and  published 
later.1 


1  Letter  to  Mr.  Brookings  from  Mr.  Brunker,  of  the  acids  and  heavy  chemicals  section, 
dated  July  19,  1918  :  "  After  a  somewhat  lengthy  discussion  it  was  decided  that  the  price 
for  mixed  acids  shall  be  determined  as  fixed  governmental  prices'  for  the  acidity  contents 
of  the  component  acids,  with  no  additional  charge  for  mixing." 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES.  805 

The  above  maximum  prices  were  agreed  upon  for  the  public  as  well  as  the 
Government.  It  was  understood  and  agreed  that  any  deliveries  made  after 
September  30  would  be  subject  to  any  revision  in  price  which  the  Government 
might  make  for  deliveries  after  that  date. 

ALKALIS. 

The  alkali  section  of  the  War  Industries  Board  was  organized  April  15,  1918. 
Previous  to  this  time  efforts  to  control  the  prices  of  alkalis  had  been  made 
by  the  alkali  section  of  the  chemical  committee  of  the  Council  of  National  De- 
fense in  cooperation  with  the  Chemical  Alliance  (Inc.). 

Bleaching  powder.— In  April,  1918,  a  tentative  Government  price  of  $0.0235 
per  pound  was  agreed  upon.  On  later  compulsory  orders  l  the  alkali  section 
and  the  procurement  division  of  the  Ordnance  Department  recommended  a  price 
of  $0.0235  per  pound  for  prime  bleach,  basis  35  per  cent  chlorine  f.  o.  b.  makers' 
plants.  This  was  reduced  to  $0.02  by  the  board  of  appraisers,  but  compulsory 
orders  for  November  deliveries  still  carried  the  price  of  $0.0235.  Fixed  prices 
were  canceled  on  November  25,  1918. 

Carbon  tetrachloride. — In  April,  1918,  the  alkali  section  recommended  a  price 
of  15  cents  per  pound  on  dry  carbon  tetrachloride  and  17  cents  per  pound  on 
fire  extinguisher  of  the  carbon  tetrachloride  type.  These  prices  were  reduced 
to  14£  cents  and  16£  cents  by  the  board  of  appraisers  and  the  latter  prices 
became  effective  from  August,  1918,  until  the  orders  were  canceled  at  the  end  of 
the  year.  During  this  time  the  entire  output  of  all  producers  was  commandeered 
by  the  Government. 

Caustic  soda. — A  price  of  $3.50  per  hundredweight  for  the  76  per  cent  caustic 
soda,  in  bags  f.  o.  b.  cars  at  sellers'  plants,  wras  set  in  the  spring  of  1918  to  apply 
to  the  Government  purchases  of  caustic  soda.  Prices  for  other  grades  were  in 
proportion  to  the  base  prices.  These  prices  continued  until  the  close  of  1918, 
when  all  restrictions  were  removed. 

Liquid  chlorine. — Beginning  May,  1918,  the  total  output  of  liquid  chlorine  was 
commandeered  by  the  Government  at  a  price  of  7£  cents  per  pound,  in  Govern- 
ment containers  f.  o.  b.  makers'  plants.  This  price  prevailed  throughout  the 
remainder  of  the  war  period.  Restrictions  were  removed  November  25,  1918. 

Soda  ash. — The  Government  fixed  the  price  of  soda  ash  early  in  1918  at  $1.57 
per  hundredweight  for  the  58  per  cent  soda  ash  in  bags  f.  o.  b.  sellers'  plant. 
These  prices  continued  in  effect  until  November  25, 1918. 

AMMONIA. 

The  first  agreement  affecting  the  price  of  ammonia  was  made  on  November  19, 
1917,  between  the  producers  of  ammonia  and  the  Food  Administration.  The 
terms  of  the  agreement  are  given  below.  . 

On  January  3,  1918,  the  President  issued  a  proclamation  licensing  the  output 
of  "  ammonia,  ammonical  liquors,  and  ammonium  sulphate  from  whatever  source 
produced."  Licenses  were  to  be  secured  on  or  before  January  21,  1918,  and  the 
Secretary  of  Agriculture  was  to  direct  the  carrying  out  of  the  provisions  of  the 
proclamation.  The  prime  products  of  ammonia  as  produced  in  by-product  coke- 
oven  plants,  coal  gas  plants,  and  nitrogen  fixation  plants  were  those  affected  by 
the  proclamation. 

The  prices  fixed  in  the  earlier  agreement  continued  in  force  through  1918,  but 
they  probably  were  inoperative  in  1919,  although  the  formal  agreement  was  to 
continue  in  operation  until  the  proclamation  of  peace. 

1The  information  in  regard  to  the  alkalis  was  obtained  from  the  report  of  the  alkali 
section  of  the  War  Industries  Board  to  Mr.  Baruch,  in  December,  1918  ;  from  the  second 
annual  report  of  the  Chemical  Alliance,  January,  1919  ;  and  from  the  1918  Yearbook  of 
the  Oil,  Paint  and  Drug  Reporter. 


806  HISTORY  OF  PRICES  DURING  THE  WAR. 

AGREEMENT   OF    NOVEMBER    19,    1917. 

At  a  meeting  on  November  19,  1917,  the  manufacturers  of  aqua  and  anhydrous 
ammonia  agreed  to  place  the  allocation  of  their  output  in  the  hands  of  the 
Food  Administration. 

They  also  agreed  not  to  sell  in  excess  of  the  following  basic  prices  f.  o.  b. 
plants : 

Anhydrous  ammonia,  30  cents  per  pound  carload  lots. 

Aqua  ammonia,  8£  cents  per  pound  carload  lots. 

Agreement  entered  into  between  Mr.  Hoover  and  manufacturers  of  ammonia 
November,  1917 : 

(1)  The  manufacturer  agrees  that  he  will  sell  his  output  of  anhydrous  am- 
monia to  such  persons  and  in  such  amounts  as  may  be  directed  by  the  United 
States  Food  Administration ;  that  he  will  direct  and  require  all  of  his  agents  to 
sell  his  product  to  such  persons  and  in  such  amounts  as  may  be  directed  by  the 
United  States  Food  Administrator.     It  is  understood  that  until  further  notice 
from  the  United  States  Food  Adminisrator  the  manufacturer  may  sell  or  use 
his  product  or  accept  orders  for  delivery  thereof  within  60  days  from  the  date 
of  such  orders,  without  direction,  limiting  as  far  as  possible  the  use  and  sale 
of  such  product  for  nonessential  purposes.    Contracts  for  deliveries  extending 
over  a  longer  period  may  be  made  only  with  special  permission  from  the  United 
States  Food  Administrator  or  his  representative. 

(2)  The  Food  Administrator  agrees  that  he  will  direct  the  distribution  of  the 
manufacturer's  output  in  as  economical  and  equitable  a  manner  as  possible, 
adhering  as  far  as  practicable  to  the  expressed  wishes  of  the  manufacturer. 

(3)  The  manufacturer  agrees  that  he  wrill  sell  all  anhydrous  ammonia  at 
prices  not  to  exceed  those  included  in  the  schedule  attached  hereto  marked  "A," 
which  is  hereby  incorporated  in  and  made  a  part  of  this  agreement.     In  case  the 
cost  of  materials  or  manufacture  or  transportation  increases  or  decreases  such 
maximum  prices  shall  be  revised  by  the  United  States  Food  Administrator,  on 
his  own  motion  or  on  application  of  the  manufacturer,  in  such  manner  that  the 
profit  of  the  manufacturer  shall  remain  substantially  the  same  as  at  the  prices 
in  said  schedule. 

(4)  The  aforesaid  prices  shall  include  all  commissions  paid  to  agents,  but 
shall  be  exclusive  of  the  prices  of  containers  for  which  payment  shall  be  required 
at  time  of  payment  for  the  contents,  the  actual  amount  so  paid  for  containers 
to  be  refunded  if  returned  in  good  order  and  in  a  reasonable  time.     In  case  of 
dispute  said  reasonable  time  shall  be  determined  by  the  United  States  Food 
Administrator  or  his  representative. 

(5)  In  the  event  that  the  supply  of  sulphate  of  ammonia  and  ammonia  liquor 
is  insufficient  to  meet  the  needs  of  the  manufacturers  entering  into  this  and 
similar  agreements,  it  is  agreed  that  the  Food  Administrator  may  allocate  the 
supply  of  such  materials  among  the  manufacturers  entering  into  this  and  similar 
agreements  with  the  said  Food  Administrator  on  such  fair  and  equitable  basis 
as  may  be  determined  by  said  administrator. 

(6)  The  manufacturer  agrees  that  in  order  to  carry  out  the  purposes  of  this 
agreement  he  will  furnish  such  reports  as  may  be  required  by  the  United  States 
Food  Administrator  or  his  representative  upon  request  and  upon  such  blanks  as 
the  United  States  Food  Administrator  may  designate,  giving  complete  informa- 
tion regarding  transactions  in  anhydrous  ammonia  imported,   manufactured, 
refined,  packed,  purchased,  contracted  for,  received,  sold,  stored,  shipped,  or 
otherwise  handled,  distributed,  or  dealt  with  by  the  manufacturer,  or  on  hand, 
in  the  possession  or  under  the  control  of  the  manufacturer,  and  any  other  infor- 
mation pertinent  thereto,  concerning  the  business  of  the  manufacturer  that  such 
representatives  may  require  from  time  to  time.     It  is  understood  and  agreed 
that  information  thus  furnished  by  the  manufacturer  shall  not  be  divulged  or 
made  known  in  any  manner  by  the  United  States  Food  Administrator  or  his 
representative,  except  in  so  far  as  necessary  to  carry  out  the  purposes  of  this 
agreement  or  in  so  far  as  directed  by  a  court  of  competent  jurisdiction. 

(7)  This  agreement  shall  remain  in  full  force  and  effect  from  its  date  until 
peace  shall  have  been  proclaimed  between  the  United  States  and  Germany. 


GOVERNMENT  REGULATIONS   RELATING  TO  PRICES.  807 

ANHYDROUS  AMMONIA   CONTAINING  NOT   LESS  THAN  99.9  PER  CENT   NH3. 


State. 

Cents 
per 
pound. 

Remarks. 

Alabama  

33 

If  from  Birmingham  stock,  33  cents  f.  o.  b.  that  point. 

Arizona 

40 

Arkansas 

34 

California  

35 

If  from  San  Francisco,  Los  Angeles,  San  Diego,  Sacramento  stocks, 

Colorado  

38 

35  cents  f.  o.  b.  these  respective  points. 

Connecticut  

31 

Delaware 

31 

District  of  Columbia  
Florida 

31 
34 

Jacksonville,  35  cents.    If  from  Jacksonville  stock,  33  cents  f.  o.  b. 

Georgia  ....           

33 

that  point. 
If  from  Atlanta  and  Savannah  stocks,  33  cents  f  .  o.  b.  that  point. 

Idaho.  . 
Illinois 

40 
31 

Chicago,  Cook  County,  East  St.  Louis,  30  cents. 

Indiana                   .  .  . 

31 

Aetna,  Calumet,  East  Chicago,  Gary,  Hammond,  Indiana  Harbor, 

Iowa 

32 

and  Whiting,  30  cents  f.  o.  b.  Chicago  if  shipped  from  that  point. 
If  from  Indianapolis  stock,  31  cents  f.  o.  b.  that  point. 
Davenport  and  Dubuque,  31  cents. 

Kansas  

33 

East  of  96°  longitude;  34  cents  west  of  96°  longitude. 

Kentucky..                

31 

Covington  and  Newport,  30  cents.    If  from  Louisville  stock,  31  cents 

Louisiana  

34 

f.  o.  b.  that  point. 
New  Orleans,  33  cents.    If  from  New  Orleans  stock,  33  cents  f.  o.  b. 

Maine 

31 

that  point. 

Maryland  

31 

If  from  Baltimore  stock,  31  cents  f.  o.  b.  that  point. 

Massachusetts 

31 

Michigan 

32 

Detroit  31  cents     If  from  Detroit  stock,  31  cents  f.  o.  b.  that  point. 

Minnesota  

33 

St.  Paul  and  Minneapolis,  32  cents.    If  from  St.  Paul  stock,  32  cents 

Mississippi... 

33 

f.  o.  b.  that  point. 

Missouri     .     .  • 

31 

East  of  93°  longitude;  33  cents  west  of  93°  longitude;  St.  Louis,  30 

Montana 

40 

cents;  Kansas  City,  32  cents.    If  from  Kansas  City  stock,  32  cents 
f.  o.  b.  that  point. 

Nebraska  

34 

Omaha,  33  cents.    If  from  Omaha  stock,  33  cents  f.  o.  b.  that  point. 

Nevada 

42 

New  Hampshire 

31 

New  Jersey  

31 

Camden,  Newark,  Paterson,  and  within  15  miles  of  New  York  City 

New  Mexico  

38 

Hall,  30  cents. 

New  York  

31 

Points  within  15  miles  of  New  York  City  Hall,  30  cents.    If  from 

North  Carolina 

33 

Buffalo  or  Rochester  stocks,  31  cents  f.  o.  b.  these  respective  points. 

North  Dakota  

35 

Ohio 

31 

Cincinnati   30  cents.    If  from  Cleveland  or  Toledo  stocks,  31  cents 

Oklahoma 

35 

f.  o.  b.  these  respective  points. 
If  from  Oklahoma  City  stock,  35  cents  f.  o.  b.  that  point. 

Oregon 

35 

If  from  Portland  stock,  35  cents  f.  o.  b.  that  point. 

Pennsylvania  

31 

Philadelphia,  30  cents.    If  from  Pittsburgh  stock,  31  cents  f.  o.  b. 

Rhode  Island  

31 

that  point. 
If  from  Providence  stock,  31  cents  f.  o.  b.  that  point. 

South  Carolina  

33 

South  Dakota  .  . 

35 

Tennessee 

33 

Bristol  and  Memphis,  32  cents     If  from  Memphis  stock    32  cents 

Texas    . 

35 

f.  o.  b.  that  point. 
East  of  101°  longitude;  37  cents  west  of  101°  longitude.    If  from 

Utah  

40 

Houston,  Fort  Worth,  Dallas,  or  San  Antonio  stocks,  35  cents  per 
pound  f.  o.  b.  these  respective  points.    If  from  El  Paso  stock,  37 
cents  f.  o.  b.  that  point. 
If  from  Salt  Lake  City  stock,  40  cents  f.  o.  b.  that  point. 

Vermont       

31 

Virginia 

32 

Hampton  Newport  News  Norfolk  Ocean  View  Old  Point  Comfort 

Washington      

35 

Phoebus,   Portsmouth,   Richmond,  and  Alexandria  County,  31 
cents.    If  from  Norfolk  or  Richmond  stocks,  31  cents  f.  o.  b.  these 
respective  points. 
If  from  Spokane  stock,  35  cents  f.  o.  b.  that  point. 

West  Virginia 

32 

Wisconsin  

32 

Milwaukee,  31  cents.    If  from  Milwaukee  stock,  31  cents  f.  o.  b.  that 

Wyoming 

40 

point. 

Terms,  30  days  net  for  both  cylinders  and  contents. 

Prices  named  above  are  freights  free  at  common-carrier  points  unless  otherwise  stated  ; 
freight  on  empty  cylinders  returned  for  credit  incumbent  on  seller  in  all-  cases. 

Above  prices  apply  to  contents  of  100  and  150  pound  capacity  cylinders.  Charge  3 
cents  per  pound  higher  for  "  small  "  or  50-pound  capacity  cylinders.  Charge  6  cents  per 
pound  higher  for  "  midget "  or  25-pound  capacity  cylinders. 


808  HISTORY   OF   PRICES   DURING   THE    WAR. 

AQUA  AMMONIA  TECHNICAL,  26°  B.,  29.4  per  cent— NH3. 

District  No.  1. — Connecticut,  Illinois,  Indiana,  Iowa,  Kentucky,  Maryland,  Massachusetts 
Michigan,  Minnesota,  Missouri,  New  Jersey,  New  York,  Ohio,  Pennsylvania,  Rhode  Island, 
and  Wisconsin  ;  C.  1.  in  drums,  8J  cents  per  pound,  26°  B.  ;  1.  c.  1.  in  drums,  8|  cents 
per  pound,  26°  B.  Freight  paid  by  shipper. 

District  No.  la. — New  Hampshire  and  Vermont :  C.  1.  in  drums,  8£  cents  per  pound, 
26°  B.  ;  1.  c.  1.  in  drums,  8|  cents  per  pound,  26°  B.  Freight  paid  by  shipper. 

District  No.  76. — Maine,  Virginia,  and  West  Virginia,  including  District  of  Columbia; 
C.  1.  in  drums,  8|  cents  per  pound,  26°  B.  ;  1.  c,  1.  in  drums,  9  cents  per  pound,  26°  B. 
Freight  paid  by  shipper. 

District  No.  2. — Alabama,  Arkansas,  Florida,  Georgia,  Louisiana,  Mississippi,  North  Caro- 
lina. South  Carolina,  and  Tennessee  :  C.  1.  in  drums,  9|  cents  per  pound,  26°  B. ;  1.  c.  1. 
in  drums,  9£  cents  per  pound,  26°  B.  Freight  paid  by  shipper. 

District  No.  3. — Arizona,  California,  Colorado,  Idaho,  Indian  Territory,  Kansas,  Montana, 
Nebraska,  Nevada,  New  Mexico,  North  Dakota,  Oklahoma,  Oregon,  South  Dakota,  Texas, 
Utah,  Washington,  and  Wyoming  :  C.  1.  in  drums,  84  cents  per  pound,  26°  B.  ;  1.  c.  1.  in 
drums,  8£  cents  per  pound,  26°  B.  Freight  to  Mississippi  River  points  allowed  by  shipper. 

Deduction  of  one-eighth  cent  per  pound  from  above  carload  drum  prices  to  be  made  when 
shipped  in  tank  cars. 

Aqua  ammonia  of  all  degrees,  in  carboys  1.  c.  1.,  2  cents  per  pound  advance,  and  in 
carboys  c.  1.,  1*  cents  per  pound  advance.  Freight  incumbent  upon  buyer. 

Deductions  from  any  of  above  prices  shall  be  made  on  the  following  degrees : 
1|  cents  per  pound,  20°  B. 
2  cents  per  pound,  18°  B. 
2$  cents  per  pound,  16°  B. 
2|  cents  per  pound,  14°  B. 

AMMONIUM  SULPHATE. 

In  the  latter  part  of  1917  the  War  Department  Issued  an  order  commandeer- 
ing the  output  of  ammonium  sulphate.  A  price  of  4£  cents  bulk  f.  o.  b.  point  of 
production  was  established  for  Government  purchases,  but  very  little  of  the 
output  was  actually  commandeered.  The  order  was  canceled  December  14, 
3918. 

The  distribution,  manufacture,  and  importation  of  ammonium  sulphate  were 
'controlled  through  the  license  system,  originating  in  the  President's  proclama- 
tion of  January  3,  1918. 

ARSENIC. 

A  presidential  proclamation  of  November  15,  1917,  provided  for  the  licensing 
of  dealers  in  white  arsenic  on  or  before  November  20,  1917,  and  for  the  licensing 
of  dealers  in  insecticides  containing  white  arsenic  on  or  before  December  10, 
1917.  The  administration  of  this  control  was  placed  with  the  Food  Admin- 
istration. 

On  February  28,  1918,  the  Food  Administration  announced  a  price  to  pro- 
ducers at  9  cents  per  pound  in  car  lots  f.  o.  b.  plants,  with  an  .ndditional 
quarter  cent  for  small  quantities,  the  price  to  apply  to  deliveries  anywhere  in 
the  United  States.  It  was  applicable  to  new  contracts  and  did  not  affect 
existing  contracts. 

With  the  establishment  of  an  increased  margin  to  dealers  on  April  4,  1918, 
the  market  price  rose  to  9i  cents.  The  margins  allowed  varied  from  one-fourth 
cent  per  pound  to  3  cents  per  pound,  depending  upon  size  of  sales. 

CASTOR  BEANS  AND  CASTOR  OIL. 

In  the  summer  of  1917  the  Council  of  National  Defense  took  the  first  steps 
in  the  control  of  the  castor-oil  industry. 

"All  available  supplies  have  been  purchased  and  will  be  -turned  over  to  the 
Government  at  the  price  paid  for  the  oil  and  without  compensation  to  the 
purchaser."  * 

About  this  time  arrangements  were  made  to  increase  the  acreage  of  castor 
beans  in  this  country.  The  growing  centers  were  organized  as  districts 


1  Oil,  Paint,  and  Drug  Reporter,  Nov.  12,  1917. 


GOVERNMENT  KEGULATIONS  KELAT1NG  TO  PRICES.  809 

and  contracts  were  made  with  growers  under  a  guarantee  of  $3  per  bushel'of 
46  pounds  on  contracts  directly  with  the  Government,  and  $3.50  per  bushel  for 
beans  grown  by  subcontractors.  Beans  were  to  be  delivered  hulled  and  sacked, 
in  carload  lots  f.  o.  b.  the  nearest  railroad  station.  The  Government  guaran- 
teed to  take  the  crop.  * 

When  the  crop  was  harvested  this  price  was  raised  to  $4.50  per  bushel  to 
the  actual  growers,  while  the  contractors  received  a  margin  over  and  above  this 
price. 

The  control  over  the  price  of  imported  castor  beans  and  castor  oil. — After 
the  President's  proclamation  of  February  14,  1918,  giving  power  to  the  War 
Trade  Board  to  restrict  imports,  effective  February  16,  1918,  all  importers  of 
castor  beans  and  castor  oil  were  required  to  give  the  United  States  Government 
a  10-day  option  to  purchase  all  imported  beans  from  Venezuela,  Colombia, 
Central  America,  Mexico,  and  the  West  Indies,  the  price  to  be  paid  for  such 
purchases  being  $3.50  per  bushel  of  46  pounds,  or  $0.076  per  pound,  duty  paid, 
duty  being  $0.003  per  pound.  The  option  on  beans  from  all  other  countries 
was  $0.098  per  pound,  duty  paid.  These  prices  were  to  apply  to  all  purchases 
at  home  and  abroad  after  February  22,  1918,  and  for  all  shipments  after  June 
10,  1918.  This  action  was  carried  out  by  the  Bureau  of  Imports  of  the  War 
Trade  Board  at  the  request  of  and  in  conjunction  with  the  Aircraft  Production 
Board. 

On  June  16  the  War  Trade  Board  announced  that  outstanding  licenses  for 
the  importation  of  castor  beans  and  castor  oil  from  the  West  Indies,  Mexico, 
Central  America,  Colombia,  and  Venezuela  were  revoked  as  to  ocean  shipments 
after  June  10,  1918.  Thereafter  no  licenses  from  those  countries  would  be 
issued,  except  when  the  United  States  Government  was  the  consignee  or  where 
the  importation  was  approved  by  the  Bureau  of  Aircraft  Production. 

On  June  23,  1918,  the  price  of  $0.098  per  pound,  stipulated  in  the  Govern- 
ment option,  was  lowered  to  $0.076  per  pound  for  all  near-by  countries.  How- 
ever, prices  on  beans  from  South  America  and  the  Orient  remained  at  $0.098 
because  of  the  high  freight  rates  from  those  countries. 

In  October,  1918,  the  War  Department  announced  an  increase  in  the  contract 
price  of  castor  beans,  making  the  price  to  growers  $0.098,  duty  paid,  at  all 
ports  of  entry,  on  beans  originating  in  the  West  Indies,  South  America,  Central 
America,  and  Mexico.  This  makes  the  price  the  same  for  all  beans,  domestic 
and  imported. 

Castor  oil  is  being  purchased  at  $0.244  per  pound  for  oil  conforming  to  speci- 
fication No.  3500-A  of  the  Signal  Corps,  other  oil  at  $0.224  per  pound. 

When  the  armistice  was  signed  the  Government  had  on  hand  large  quan- 
tities of  castor  oil.  The  Bureau  of  Aircraft  Production  negotiated  with  Ameri- 
can crushers  for  the  purchase  of  the  Government  stocks  of  domestic  beans 
and  oil.  Somewhat  earlier  the  War  Industries  Board  had  practically  com- 
pleted negotiations  for  the  sale  of  these  stocks  on  the  basis  of  25  cents  per 
pound  for  the  oil.  The  aircraft  bureau  officials,  however,  raised  this  price 
above  30  cents  a  pound. 

All  Government  activities  in  castor  beans  and  oil  ceased  in  December,  1918. 

1  1918  Year  Book.  Oil,  Paint,  and  Drug  Reporter. 
'Official   Bulletin,   Oct.   22,   1918. 


810  HISTORY  OF  PRICES  DURING  THE  WAR. 

GLYCERIN. 

On  July  30,  1918,  the  Food  Administration  made  the  following  announcement : 

Prices  at  which  dynamite  glycerin  is  to  be  furnished  to  the  allied  Government 
and  Domestic  consumers  during  the  remainder  of  1918  have  been  settled  by  joint 
agreement  between  the  Food  Administration  and  makers  of  soap  and  candles. 

Allied  requirements,  estimated  at  7,000  long  tons,  will  be  furnished  at  60 
cents  a  pound  in  August  and  September;  58  cents  in  October  and  November; 
and  56  cents  in  December,  f.  o.  b.  production  points  in  drums — drums  included 
in  price — deliveries  to  be  divided  into  quotas  of  approximately  one-third  for 
each  of  the  three  periods. 

The  same  price  was  to  be  maintained  as  a  minimum  price  for  chemically  pure 
glycerin,  except  that  chemically  pure  glycerin  could  be  sold  on  the  usual  terms 
of  1  per  cent  discount  for  cash  in  10  days,  or  net  30  days,  freight  prepaid,  drums 
extra  and  returnable  at  sellers'  expense. 

The  agreement  with  the  Allies  for  the  last  five  months  was  carried  out. 
About  1,000  tons  were  left  undelivered  at  the  time  of  the  armistice,  but  satis- 
factory arrangements  between  the  Allies  and  the  American  producers  were 
made.1 

NITRATE  OF  SODA. 

The  purchase  and  importation  of  nitrate  to  the  United  States  was  controlled 
by  the  United  States  Government  through  the  War  Industries  Board  in  coop- 
eration with  the  importers  formerly  handling  this  material.  The  Government 
received  their  nitrate  through  the  importers  at  cost,  and  the  profit  charged  by 
the  importers  to  private  users  was  controlled  by  the  Government  so  that  uniform 
cost  to  all  users  was  secured,  this  cost  being  based  on  the  average  monthly  cost 
in  Chile,  plus  the  freight  charge,  exchange,  and  other  elements  of  cost. 

A  committee  known  as  the  nitrate  committee  of  the  United  States  was  estab- 
lished with  offices  in  New  York,  and  a  New  York  representative  of  the  War 
Industries  Board  represented  that  board  in  the  offices  of  this  committee.3 

Uniform  monthly  prices  were  established,  based  upon  the  average  cost  in  Chile 
during  the  particular  month.  To  this  average  price  wras  added  a  fixed  charge 
of  2.5  per  cent  of  landed  costs  in  this  country  as  a  brokerage  charge.  Determina- 
tion of  the  uniform  price,  as  well  as  the  control  of  the  distribution  of  nitrate  of 
soda,  was  in  the  hands  of  the  nitrate  committee.  This  arrangement  was  in  force 
from  the  beginning  of  1918.  According  to  the  best  adVices  the  quotations  in  this 
country  up  to  the  month  of  June  were  $4.225  per  hundredweight  of  95  per  cent 
nitrate  and  $4.25  for  the  96  per  cent. 

At  the  time  of  the  armistice  the  Government  had  on  hand  surplus  stocks  of 
nitrate  of  soda.  The  War  Department  announced  on  March  10,  1919,  that  these 
stocks  would  be  disposed  of  at  the  prevailing  market  prices.3 

QUEBRACHO. 

An  agreement  between  importers  of  solid  quebracho  extract  and  the  War  Trade 
Board  granting  an  option  to  the  United  States  Government  on  all  shipments 
during  1918  became  effective  May  6,  1918. 

The  maximum  price  agreed  upon  in  the  event  of  the  exercise  of  such  option 
was  6£  cents  per  pound,  ex  dock  Atlantic  seaports  north  of  Cape  Hatteras,  basis 
65  per  cent  tannin,  net  landed  reweight,  net  cash  basis  $20  ocean  freight  per  ton 
of  2,240  pounds. 

1  Information  from  fats  and  oils  section  of  the  United  States  Food  Administration. 

2  Statement   of   Mr.    C.    H.    McDowell,   director   of   the  chemicals  division   of   the   War 
Industries  Board,  from  Federal  Trade  Information  Service,  Dec.  24,  1918. 

'Federal   Trade   Information    Service,    Mar.    10,    1919. 


GOVERNMENT  REGULATIONS  RELATING  TO  PRICES.  811 

On  June  30,  1918,  the  War  Trade  Board  announced  a  new  ruling,  placing  tan- 
ning materials  on  the  list  of  restricted  imports. 

Shipments  of  a  limited  quantity  only  of  solid  quebracho  extract  were  allowed 
after  July  10, 1918,  and  the  fixed  price  became  inactive  after  that  date. 

The  War  Trade  Board  lifted  its  ruling  of  June  30  on  December  5,  1918.1 

SMOKELESS  CANNON  POWDER. 

Beginning  with  February  13,  1913,  all  Army  and  Navy  appropriation  bills 
specify  that  "  no  part  of  any  money  appropriated  in  this  act  shall  be  expended 
for  the  purchase  of  powder,  other  than  small  arms,  at  a  price  in  excess  of  53 
cents." 

In  other  words,  Congress  controlled  the  price  of  cannon  powder,  but  not  of 
rifle  powder. 

SULPHUR. 

Sulphur  was  one  of  the  fertilizer  materials  included  in  the  President's  license 
proclamation  of  February  25,  1918. 

On  July  2,  1918,  the  President  gave  his  approval  to  a  resolution  passed  by  the 
War  Industries  Board  on  June  27,  1918,  in  which  the  board  assumed  control  of 
sulphur  materials,  controlling  production  and  distribution.  Commandeering 
orders  were  to  be  issued  where  necessary.2 

Early  in  the  fall  of  1917  the  fertilizer  committee  of  the  chemical  alliance,  act- 
ing with  the  consent  of  the  Council  of  National  Defense,  arranged  for  a  price 
of  sulphur  at  $22  per  long  ton  f.  o.  b.  mines.  This  policy  was  continued  until 
June  7,  1918,  when  the  War  Industries  Board  took  more  direct  control  of  the 
sulphur  situation.3  The  same  price,  however,  continued  effective  through  the  life 
of  the  sulphur  and  pyrites  section  of  the  War  Industries  Board.4 

TOLUOL. 

The  following  resolution  was  passed  by  the  committee  on  explosives  and  ap- 
proved by  the  War  Industries  Board  on  January  29,  1918 : 

It  is  requested  that  the  Ordnance  Department  of  the  Army,  with  the  consent 
of  the  Navy,  commandeer  the  entire  toluol  production  of  the  country,  and  that 
a  committee  on  toluol  be  appointed  composed  of  representatives  of  the  Army, 
the  Navy,  and  the  War  Industries  Board,  said  committee  to  be  charged  with 
the  duty  of  recommending  the  development  of  further  facilities  for  toluol  and 
a  distribution  of  all  toluol  produced.5 

The  price  paid  for  the  toluol  which  was  so  commandeered  was  $1.50  per 
gallon.  In  June,  1918,  this  price  was  extended  to  cover  all  toluol  released 
for  rionmilitary  purposes,  at  the  following  rates : 8 

Per  gallon. 

Car  lots  in  tank  cars 1 $1.  50 

Any  quantity  in  drums 1.55 

1  War  Trade  Board  Ruling  378. 

2  Minutes  of  War  Industries  Board,  June  27,  1918. 

3  Second  Annual  Report  of  the  Chemical  Alliance,  January,  1919. 

4  Letter  of  Apr.  8.  1919,  from  Mr.  W.  G.  Woolfolk,  head  of  the  sulphur,  pyrites,  and 
alcohol  section  of  the  War  Industries  Board. 

r>  Minutes  of  the  War  Industries  Board,  Jan.  30,  1918. 

"  The  toluol  section  of  the  chemical  division  of  th«  War  Industries  Board  sent  the  fol- 
lowing naemorandum  to  the  chief  of  the  chemical  section  on  Aug.  30,  1918  :  "  We  are 
advised  by  the  hoard  of  appraisers,  War  Department,  that  an  award  of  $1.50  per  gallon 
has  been  made  on  toluol  taken  under  existing  compulsory  order.  The  award  to  run  for 
duration  of  the  order." 


812  HISTORY   OF   PRICES   DURING   THE   WAR. 

No  release  for  shipment  was  granted  where  a  price  in  excess  of  above  is  asked, 
and  all  releases  other  than  for  military  purposes  were  stamped: 

Released  only  upon  condition  that  price  does  not  exceed  $1.50  per  gallon  in 
tank  cars;  $>1.55  in  drums.1 

WOOD  CHEMICALS. 

Under  a  commandeering  order  issued  December  24,  1917,  by  the  director  of 
purchases,  storage  and  traffic,  through  the  wood  chemicals  section  of  the  War 
Industries  Board  all  wood  chemicals  were  commandeered  for  a  period  of  six 
months.  The  prices  of  acetate  of  lime,  acetic  anhydride,  acetone,  wood  alcohol, 
ethyl  methyl  ketone,  and  methyl  acetone  were  fixed  at  the  same  time;  prices 
for  acetic  acid,  formaldehyde  and  methyl  acetate  were  announced  in  February, 
1918. 

On  July  1,  1918,  this  commandeering  order  was  reissued  to  continue  until 
January  1,  1919.  The  same  prices  were  awarded  by  the  board  of  appraisers. 

The  order  was  canceled  December  14,  1918. 

WOOL  GREASE. 

The  price-fixing  committee  has  approved  an  agreement  made  by  the  producers 
of  wool  grease  fixing  a  maximum  price  of  16  cents  per  pound  packed  in  barrels 
f.  o.  b.  shipping  point  this  price  to  take  effect  September  17,  1918,  expiring 
December  17,  1918,  both  dates  inclusive,  and  covering  all  sales  made  both  to  the 
Government  and  to  the  public.  This  price  applied  to  wool  grease  containing  a 
moisture  content  not  exceeding  3  per  cent  and  any  excess  of  moisture  above  3 
per  cent  called  for  a  proportionately  lower  price.  The  guarantee  of  ash  was 
limited  to  2  per  cent. 

It  was  further  agreed  by  the  producers  that  all  sales  should  be  made  subject 
to  allocation  by  the  "  Tanning  material  and  natural  dye  section  "  of  the  War 
Industries  Board. 

The  prices  were  discontinued  on  the  date  of  expiration. 

1  Metallurgical  and  Engineering  Chemistry,  June  1,  1918. 


10.  RUBBER, 


The  appended  circular  issued  by  the  War  Trade  Board  on  April  30,  1918,  indi- 
cates the  origin  and  nature  of  the  control  over  the  prices  of  rubber  and  rubber 
substitutes. 

On  Dec-ember  14  and  23,  1918,  the  War  Trade  Board  discontinued  the  Govern- 
ment option  price  and  removed  the  restrictions  on  imports.1 

CIRCULAR  ISSUED  BY  WAR  TRADE  BOARD  APRIL  30,  1918. 

The  importance  of  securing  every  possible  ship  for  trans-Atlantic  uses  in  con- 
nection with  carrying  on  the  war  has  now  become  paramount.  With  this  in 
view,  the  quantity  of  various  articles  of  commerce  heretofore  freely  imported 
will  be  substantially  limited  until  further  notice.  Among  these  commodities  is 
crude  rubber. 

To  the  end  that  such  limitation  of  imports  shall  not  invite  hoarding,  specula- 
tive dealing,  and  profiteering,  the  War  Trade  Board  has  arranged  that  those 
dealing  in  this  raw  material  and  the  manufacturers  thereof  will  be  governed  by 
rules  and  regulations  about  to  be  promulgated  by  the  War  Trade  Board  to  the 
entire  rubber  industry  through  the  Rubber  Association  of  America. 

You  are,  therefore,  hereby  instructed  on  and  after  May  1,  1918,  not  to  indorse 
any  bills  of  lading  for  crude  rubber  or  to  accept  any  transfers  or  to  release  any 
crude  rubber  without  securing  from  the  transferees  or  the  applicant  for  a 
release  an  option  and  a  guarantee  in  substantially  the  following  form : 

OPTION   AND  GUARANTY  CLAUSE  TO  BE  INSERTED  IN   PRESENT  RUBBER  GUARANTY. 

That  the  United  States  Government  shall  have,  and  it  is  hereby  granted,  an 
option  to  purchase  at  the  prices  and  on  the  terms  hereafter  set  forth  all  or  any 
part  of  the  crude  rubber  covered  by  this  guaranty  and  also  all  other  crude 
rubber  now  or  hereafter  owned  or  controlled  by  the  undersigned  until  sold  and 
delivered  to  a  manufacturer. 

In  the  event  of  the  exercise  of  such  option  price  to  be  paid  for  crude  rubber 
and  gums  is  fixed  in  accordance  with  the  appended  schedules. 

That  the  undersigned  will  not  sell,  transfer,  or  deliver  the  rubber  covered  by 
the  foregoing  option,  or  any  part  thereof,  to  or  for  the  benefit  of  any  person  at 
a  price  greater  than  the  prices  set  forth  in  the  foregoing  option,  except  such 
rubber  as  he  may  be  under  contractual  obligation  to  deliver  under  a  contract 
executed  and  in  force  prior  to  May  1,  1918. 

Copies  of  such  contracts,  sworn  to  as  being  correct,  must  be'  filed  with  the 
War  Trade  Board  within  five  days  from  this  date.  Any  deliveries  made  under 
such  contracts  to  manufacturers  subsequent  to  the  date  on  which  import  restric- 
tions and  a  plan  for  the  allocation  of  crude  rubber  shall  be  made  effective  shall 
constitute  a  portion  of  the  amount  allocated  to  such  manufacturers  under  such 
plan. 

PRICES  EFFECTIVE  MAY  1,  1918. 

Per  pound. 

Para,  upriver  fine $0.68 

Plantation  : 

First    latex    crgpe .63 

Smoked    sheets,    standard   quality .  62 

PRICES   EFFECTIVE   MAT   14,  1918. 

Plantation  qualities  : 

Off  standard  latex  crepe .  62 

Off  color  latex ,  61 

No.   1  amber   crepe .  60 

No.  2  amber  crgpe , .  60 

1  War  Trade  Board  Rulings  414,  456. 

813 


814  HISTORY  OF  PRICES  DURING  THE   WAR. 

Plantation  qualities— Continued.  Per  pound. 

No.  3  amber  crgpe  (medium  color)- $0.58 

No.  4  amber  cr§pe  (darkish  color) ~ .57 

Prime,  clean,  light-brown  cr6pe,  thick  and/or  thin .  GO 

Medium  color  brown,  clean  crfipe,  thick  and/or  thin .  58 

Good  dark-brown  crgpe,  thick  and/or  thin .54 

Specky  brown  crgpe,  thick  and/or  thin .  50 

Massed   or   rolled   crfipe .44 

Colombo  scrap  No.  1  quality .  46 

Colombo  scrap  No.  2  quality .  44 

Standard  quality  smooth  smoked  sheets i.60 

Standard  quality  unsmoked  sheets 2.61 

Mexican  guayule  : 

Guayule  crude,  with  20  per  cent  guaranty  of  shrinkage .  35 

Clean,  dry,  and  treated  guayule,  such  as  Duro,  Triangle,  Box,  Torreon,  and 

Alto    brands .  48 

Para  grades : 

Upriver    medium .  6.1 

Manaos  weak  fine .  5t> 

Upriver    coarse .  40 

Upper  Caucho   ball .  40 

Xingu    ball .  38 

Lower  Caucho   ball .  36 

Islands    fine .  59 

Islands    coarse .  27 

Cameta    .  28 

Central  American  grades  : 
Central  scrap — 

Esmeralda .  30 

Corinto    .  39 

Mexican    , .  30 

Bluefield    .  39 

Central  slab — 

Guatemala    .  32 

Colombian .  32 

Mexican,  and  others  of 'similar  nature .  32 

African  grades  : 

Red   Congo  ball 48 

Black  Congo — 

Kassai     .  50 

Lopori   .  50 

Equateur .  50 

Sangha  and  similar  grades .  50 

Benguellas,  32J  per  cent  shrinkage .29 

Benguellas,  28  per  cent  shrinkage .  33 

Niger  paste  and  flake .28 

Red  Kassai  nuggets,  cords,  and  similar  grades .42 

Massais : .  55 

Rio    Nunez .  r>r> 

Miscellaneous  : 

Mattogrosso   fine .  53 

Mattogrosso  coarse .  38 

Penang  (this  includes  Java) .37 

Caucho   tails .  35 

Gutta  Joolatong   (Pontianac)  : 

Palambang   .  16 

Banjermassiu   .  15 

Sarawak    .  14 

Pressed  Gutta  Joolatong,  having  approximately  40  per  cent  of  shrinkage  loss .  25 

Gutta    Siak , 3    28 

Balata  : 

Prime  suriname  amber  sheet .97 

Fair  average  sheet .95 

Venezuela    block .  71 

Colombian    block .  61 

Panama  block .  59 

Other  grades  of  Balata  at  their  relative  value. 

Gutta-percha  : 

Red    Macassan 3.  00 

Other  grades  at  their  relative  value. 

PRICES  EFFECTIVE   MAY  29,  1918. 

Manicoba  (on  the  basis  of  30  per  cent  loss  in  washing  and  drying) .  36J 

(Lower  qualities  to  be  priced  in  accordance,  so  that  they  shall   not  cost  the 
manufacturer  over  52  cents  per  pound  dry  weight.) 

Mollendo   fine .  60 

Tapajos .  61 

Xingu   fine .  63 

Peruvian  weak  fine '. .  55 

Lower  Amazon  weak  fine .  45 

PRICES  EFFECTIVE  JUNE  13,  1918. 

Knapsack   Madeira   fine   Para .  73 

Madeira  fine  Para .  69 

1  Revised  May  29  to  61  cents.  2  Revised  May  29  to  60  cents.  3  In  bond. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  815 

riiK'KS     KFKKCTIVK     JT'LY     2,    191*. 

Africans  :                                                                                                                                           Per  Pound. 

Accra  (Gold  Coast)  lumps $0.28 

Lagos  lumps , .  28 

Lump   flake .  28 

Conakry  niggers .  55 

Prime  Mozambique   ball .52 

Sierra   Leone   niggers .50 

Hatisa    hall .35 

Hausa    cake .  «f5 

Cameroon  ball  and  similar  grades .  35 

Gambia    niggers .  45 

Prime  Madagascar  qualities  (on  the  basis  of  35  per  cent  shrinkage)  _* .  35 

Madagascar  niggers  (on  the  basis  of  45  per  cent  shrinkage) .  29 

Assam  and  Rambong: 

Prime    crepes .  60 

Good  quality   crepes .  58 

Assam  onions .  54 

PRICKS    EFFECTIVE   .Tl'IA'    t\,   l!Hs. 

Para,  fine  : 

Peruvian .  67 

Cut    Angostura .64 

Para,  medium  : 

Peruvian    .62 

Cut     Angostura .58 

Coarse,   medium •      .  45 

Para,  coarse  : 

Peruvian    .  37 

Mollendo .  37 

Rio  Negro  coarse * .  38 

Rio  Negro  strings .35 

Nugget    coarse .  46 

Angostura    coarse .  37 

Tapa.ios  coarse .  38 

Xingu    coarse .  38 

Ceara  coarse  (Negroheads) .38 

Miscellaneous  : 

Ceara   scrap   1 .37 

Pernambuco  sheet .  35 

Mangabeira    sheet 1 .  35 

Upper  Caucho  slab . .  33 

All  of  the  above  prices  are  on  the  basis  of  c.  i.  f.  New  York. 


11.  NEWS-PRINT  PAPER. 


Pursuant  to  a  resolution  of  the  United  States  Senate,  dated  April  24,  1916, 
the  Federal  Trade  Commission  undertook  an  investigation  of  the  news-print 
paper  industry  of  the  United  States.  In  February,  1917,  certain  manufacturers 
requested  the  Federal  Trade  Commission  to  fix  "  a  fair  and  reasonable  price 
for  the  sale  of  such  paper  for  use  in  the  United  States  "  in  the  period  from 
March  1,  1917*,  to  September  1,  1917.  Such  a  price  was  fixed  by  the  commis- 
sion on  March  3,  1917.  After  this  agreement  was  adopted  a  Federal  grand 
jury  for  the  southern  district  of  New  York  found  indictments  against  four 
of  the  signatories  to  the  agreement  for  violations  of  the  Sherman  antitrust  law. 
The  agreement  soon  collapsed.  On  November  26,  1917,  a  new  agreement  was 
made  between  Thomas  W.  Gregory,  Attorney  General  of  the  United  States,  as 
trustee,  and  certain  persons  and  corporations  engaged  in  the  manufacture  and 
sale  of  news-print  paper. 

The  substance  of  this  agreement  and  the  subsequent  action  of  the  Federal 
Trade  Commission  are  given  in  the  statement  below  issued  by  the  commission 
on  June  18,  1918. 

The  prices  announced  upon  the  different  dates  of  agreement  are  here  arranged 
in  tabular  form. 


Commodity. 

Agency  fixing  price. 

Date  or  period. 

Price 
fixed 
(f.o.b. 
mill). 

Paper,  news-print. 
Roll  news  in  car  lots  

Per  cwt. 
S3  10 

Roll  news  in  less  than  car  lots  
Sheet  news  in  car  lots 

Federal    Trade    Commis- 
sion. 

{Apr.  1.  1918;  set  originally 
for  duration  of  the  war 

3.22£ 
3  50 

Sheet  news  in  less  than  car  lots.  .  . 

and  3  months  thereafter. 

3  62J 

Roll  news  in  car  lots. 

Arbitration    decision    on 

•. 

3  50 

Roll  news  in  less  than  car  lots  

Sept.  25t  1918,  by  United 

Apr.  1,  1918;  for  duration 

3  62i 

Sheet  news  in  car  lots  ..... 

States  circuit  court,  sec- 

>   of  the  war  and  3  months 

3  90 

Sheet  news  in  less  than  car  lots 

ond  circuit 

1    thereafter. 

4  02i 

Roll  news  in  car  lots. 

Revised    prices    allowing 

3  63J 

Roll  news  in  less  than  car  lots  

Federal   Trade   Commis- 
sion; prices  revised  Oct. 

for  wage  increase    be- 
came effective  May  1 

3.7$ 
4  03| 

Sheet  news  in  less  than  car  lots 

18,  1918. 

1918 

4  15s 

Roll  news  in  car  lots.  . 

Revised    prices    allowing 

3  75* 

Roll  news  in  less  than  car  lots  

.  .do  

for  freight  increase  be- 

2.87; 

Sheet  news  in  car  lots  
Sheet  news  in  less  than  car  lots  . 

came  effective  July  1. 
1918 

4.  15 
4.27J 

FINDINGS    OF   THE    FEDERAL    TRADE    COMMISSION    OF    PRICES    AND    TERMS    OF    CONTRACT 
AND  SALES  OF  NEWS-PRINT  PAPER  UNDER  AGREEMENT  DATED   NOVEMBER  26,   1917. 

The  Federal  Trade  Commission  has  had  before  it  as  a  reference  the  agree- 
ment made  on  November  26,  1917,  between  Thomas  W.  Gregory,  the  Attorney 
General  of  the  United  States,  as  trustee,  and  certain  persons  and  corporations 
engaged  in  the  manufacture  and  sale  of  news-print  paper. 

The  manufacturers,  parties  to  this  agreement,  comprise  three  United  States 
companies  and  seven  Canadian  companies,  as  follows:  United  States  com- 
panies— International  Paper  Co.,  Minnesota  &  Ontario  Power  Co.,  Gould  Paper 
Co.  Canadian  companies — Spanish  River  Pulp  &  Paper  Mills  (Ltd.),  Abitibi 
Power  &  Paper  Co.  (Ltd.),  Laurentide  Co.  (Ltd.),  Belgo-Canadian  Pulp  & 
Paper  Co.  (Ltd.),  Price  Bros.  &  Co.  (Ltd.),  Donnacona  Paper  Co.  (Ltd.),  Bromp- 
ton  Pulp  &  Paper  Co.  (Ltd.). 

Those  10  companies  produced  in  1917  about  950,000  tons  of  news-print  paper, 
or  nearly  50  per  cent  of  the  total  output  of  all  mills  on  the  North  American 
Continent.  The  bulk  of  this  tonnage  was  consumed  by  newspaper  publishers 
in  the  United  States. 

816 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  817 

The  agreement  provides,  briefly,  that  the  Federal  Trade  Commission  shall 
fix  the  maximum  prices  and  terms  of  sale  of  the  output  of  the  news-print 
paper  of  these  10  companies  sold  to  purchasers  in  the  United  States  for  the 
duration  of  the  war  and  three  months  thereafter.  In  the  case  of  the  Minne- 
sota &  Ontario  Power  Co.  and  its  subsidiary,  the  Fort  Frances  Pulp  &  Paper 
Co.  (Ltd.),  the  agreement  provides  that  the  prices  shall  be  fixed  as  of  January 
1,  1918.  The  commission  is  also  directed  to  determine  the  just  and  reasonable 
maximum  prices  and  terms  of  resale  of  all  paper  merchants,  sales  agents,  or 
other  middlemen  selling  the  product  of  these  10  companies  to  customers  in  the 
United  States. 

All  parties  at  interest  were  invited  to  lay  before  the  commission  any  perti- 
nent data,  and  counsel  were  diligent  and  helpful  to  the  commission  in  securing 
a  complete  knowledge  of  the  circumstances  surrounding  production  and  distri- 
bution. Extensive  hearings  were  held  and  a  mass  of  evidence  taken. 

Cost  figures  were  drawn  from  books  of  original  entry  and  the  vouchers  and 
accounts  of  the  several  manufacturers  were  scrutinized  by  expert  accountants. 
Complete  appraisals  of  various  plants  were  also  presented. 

Nei  PS  print  prices. — The  commission  has  heard  the  evidence  and  examined 
the  data  presented  to  it  and  finds  the  following  maximum  prices  as  of  April 
1,  1918,  to  be  fair  and  reasonable  for  each  of  the  10  signatory  companies  for 
sales  of  standard  newsprint  paper  to  customers  in  the  United  States : 

Roll  news  in  car  lots,  $3.10  per  100  pounds  f.  o.  b.  mill. 

Roll  news  in  less  than  car  lots,  $3.22£  per  100  pounds  f.  o.  b.  mill. 

Sheet  news  in  car  lots,  $3.50  per  100  pounds  f.  o.  b.  mill. 

Sheet  news  in  less  than  car  lots,  $3.62^  per  100  pounds  f.  o.  b.  mill. 

The  cost  of  the  Brompton  Pulp  &  Paper  Co.  (Ltd.),  which  is  an  incomplete 
mill  o,f  small  newsprint  tonnage  and  which  buys  its  sulphite,  was  not  allowed 
to  control  in  the  determination  of  the  above  prices. 

The  Minnesota  &  Ontario  Power  Co.  is  directed  to  adjust  its  settlements  for 
the  months  of  January,  February,  and  March,  1918,  on  a  basis  of  10  cents  per 
100  pounds  above  these  maximum  prices,  thereafter  the  said  maximum  prices 
shall  apply. 

Terms  of  sale. — The  commission  directs  that  the  so-called  standard  form  of 
contract  be  used  at  this  time,  with  changes  in  terms  that  shall  provide:  (a)  A 
definite  tonnage  specification  and  passage  of  full  and  unrestricted  title  to  the 
customer  upon  delivery,  and  (b)  that  the  signatory  manufacturers  shall  credit 
customers  for  overweight  above  the  32-pound  basis,  computed  by  taking  the 
annual  average  of  the  total  tonnage  delivered  on  contract,  provided  that  the 
customer  gives  such  prompt  notice  as  to  overweights  from  time  to  time  as  will 
enable  the  manufacturer,  if  he  desires,  to  verify  the  claims  currently  and  to 
make  correction  in  weights  of  subsequent  deliveries. 

Certain  other  changes  in  the  terms  of  contract  urged  by  the  publishers  con- 
tain merit,  but  this  does  not  appear  to  be  a  proper  time  for  introducing 
avoidable  changes. 

Jobbers'  prices  and  terms  of  resale. — The  maximum  commissions  for  jobbers 
or  other  middlemen  selling  newsprint  obtained  from  any  of  the  signatory 
manufacturers  to  customers  in  the  United  States  shall  be  15  cents  per  100 
pounds  on  carload  lots,  40  cents  per  100  pounds  on  less  than  car  lots,  and  60 
cents  per  100  pounds  on  less  than  ton  lots. 

The  commissions  shall  be  added  to  the  actual  cost  of  paper  at  the  mill  or  at 
the  warehouse.  The  cost  at  the  warehouse  will  be  the  net  mill  price  plus 
freight,  cartage,  and  other  reasonable  necessary  expenses  incurred  in  getting 
the  paper  to  the  warehouse.  In  billing  customers  these  items  and  the  commis- 
sion shall  be  stated  separately. 

SEPTEMBER    25,    1918. 

The  findings  and  award  of  the  Federal  Trade  Commission  concerning  prices 
and  terms  of  contract  and  sale  of  news-print  paper,  as  announced  June  18,  1918, 
were  appealed  for  review  to  the  United  States  circuit  court. 

The  decision  of  this  court,  as  issued  on  September  25,  1918,  is  given  in  the 
following  statement. 

125547°— 20 52 


818  HISTORY  OF  PRICES  DURING  THE  WAR. 

FINDINGS    AND   CONCLUSIONS   OF   THE   JUDGES   OF   THE   CIRCUIT   COURT  IN 

NEWS-PRINT  CASE. 

FINDINGS. 

1.  Our  jurisdiction  rests  solely  on  the  consent  of  the  signatory  parties;  we 
act  as  arbitrators  only. 

2.  The  principles  applied  by  courts  of  authority  in  regulating  rates  for  public 
utilities  should  be  followed  in  this  proceeding  as  nearly  as  possible. 

3.  In  valuing  the  capital  investment  used  in  producing  news  print,  prices 
before  the  present  European  War  should  be  adopted. 

4.  We  are  not  informed  as  to  the  investment  or  value  of  the  plant  of  the 
Gould  Paper  Co.    The  Brompton  Co.  produces  little  news  print,  and  that  under 
abnormal   conditions.      Therefore,   these   manufacturers  must  conform  to  the 
fair   maximum  price  fixed   for  the  other  eight  parties  and  based  upon   the 
evidence  concerning  said  eight  businesses. 

5.  In  ascertaining  capital   investment,  i.   e.,   the  present  value  of  property 
actually  used  in  paper  production,  we  exclude  timber  lands  whether  owned  or 
leased,  also  undeveloped  or  potential  water  power,  i.  e.,  water  rights;  but  in- 
clude mill  and  town  sites,  terminal  facilities,  and  improvements  on  or  develop- 
ment of  natural  water  powers,  together  with  any  investment  by  way  of  actual 
payment  for  power  rights.     The  foregoing  allowed  elements  of  capital  value  are 
the  "  tangibles." 

6.  Going    concern    value    and    working    capital    are    proper    additions    to 
"  tangibles." 

7.  In  ascertaining  manufacturing  cost,  no  allowance  for  stmnpage  in  respect ' 
of  wood  obtained  from  leased  Canadian  Crown  lands)  is  made,  such  stmnpage 
not  representing  any  actual  disbursement,  nor  the  partial  exhaustion  of  prop- 
erty for  which  payment  (on  stumpage  basis)  was  ever  made. 

In  respect,  however,  of  wood  cut  in  owned  lands,  such  stumpage  charge  is 
proper,  and  $2  per  cord  is  less  than  the  market  rate. 

8.  Owing  to  more   costly   wood   and   higher  expenses  for  labor,   taxes,    and 
freight  charges,  the  typical  mill  in  the  United  States  can  not,  with  equal  skill 
in  management,  produce  paper  as  cheaply  as  a  similar  mill  in  Canada;  such 
disadvantage   means   an   additional   cost   per   ton   of  paper  of   slightly   more 
than  $5. 

9.  The  Spanish  River  Co.  is  an  exception  to  the  Canadian  manufacturers 
solely  because  of  a  high  and  wholly  unexplained  wood  cost. 

10.  The  maximum  selling  price  fixed  for  all  the  signatories  should  be  based 
on  an  average  of  the  reasonable  capital  investments,  and  fair  manufacturing 
costs  of  the  signatory  parties,  other  than  the  Gould  &  Brompton  Cos. 

11.  It  is  not  advisable  to  make  any  special  rate  by  way  of  favor  for  manu- 
facturers  meeting  with   special  but   temporary  misfortune.     The  high  manu- 
facturing cost  of  The  Minnesota  &  Ontario  Co.,  due  to  drought,  and  the  serious 
loss  of  the  Abitibi  Co.,  ascribed  to  sabotage,  are  business  accidents  which  would 
not  relieve  them  from  the  competition  of  more  fortunate  rivals  in  ordinary 
times,  and  under  a  fixed  maximum  rate  they  must  still  meet  competition. 

12.  We  consider  ourselves  bound  by  agreement  of  parties  that  the  annual 
production  of  each  manufacturer  is  to  be  taken  as  the  proven  daily  capacity 
of  plant  multiplied  by  300  yearly  working  days.     Therefore,  we  disregard  the 
fact  also  proven   that  the  output  of  the  signatory  parties  for  1917  was  5.6 
per  cent  over  the  assumed  production. 

13.  The    fair    present   value,    as   depreciated    and    at   prewar   prices   of   an 
integrated  paper-mill  plant,  per  ton  of  daily  capacity,  is : 

Tangibles $25,  000 

Going  concern  value,  10  per  cent 2,  500 

Working   capital 12,  000 

Total 39,  500 

14.  A  fair  maximum   return  on  said  capital  in  a  business  of  the  hazards 
proven  is  15  per  cent  per  annum. 

15.  The   actual    cost   of  making  1   ton   of   news-print   paper   in   an   average 
Canadian  mill,  out  of  recently  gathered  wood  and  without  any  allowance  for 
stumpage  not  actually  paid,  was  not  less  than  $48,  on  or  about  April  1,  1918. 
There  is  no  evidence  or  suggestion  that  any  element  of  cost  has  since  then 


GOVERNMENT  REGULATIONS   RELATING   TO   PRICES.  819 

diminished.  The  same  ton  of  paper  would  have  cost,  if  made  in  the  United 
States,  about  $5  more;  and  the  average  cost  for  the  eight  manufacturers 
considered  is  more  than  $50  per  ton. 

CONCLUSION. 

Applying  the  foregoing  findings  to  a  plant  having  daily  capacity  of  100  tons : 

The  capital  invested  is  $39,500X100 $3,950,000 

The  fair  annual  return.  15  per  cent . 592.  500 


To  be  obtained  by  selling  all  of  an  annual  production  of  30,000  tons, 

or  a  profit  per  ton  of 19.75 

Add  to  this  average  cost  of  manufacture,  say 50.  25 


And 70.  00 

should  be  the  maximum  selling  price  of  1  ton  of  news  print  in  rolls  f.  o.  b.  mill, 
It  is  therefore  ordered  that  the  finding  or  award  of  the  Federal  Trade  Com- 
mission be  varied  so  as  to  read  as  follows: 

The  fair  and  reasonable  maximum  prices  for  each  of  the  10  signatory  com- 
panies for  sales  of  standard  news-print  paper  to  customers  in  the  United  States 
are: 

Per  cwt. 

Roll  news  in  car  lots $3.  50 

Roll  news  in  less  than  car  lots 3.  62* 

Sheet  news  in  car  lots 3.90 

Sheet  news  in  less  than  car  lots 4.  02$ 

All  prices  are  f.  o.  V».  mill. 

The  Minnesota  &  Ontario  Co.  is  directed  to  adjust  its  outstanding  settlements 
for  the  months  of  January,  February,  and  March,  1918,  at  not  over  the  maxi- 
mum hereby  fixed. 

In  no  other  respect  does  this  vary  from  the  award  of  the  Federal  Trade  Com- 
mission. 

OCTOBER    18.    1918. 

Following  the  announcement  of  the  decision  of  the  United  States  Circuit 
Court,  on  September  25,  1918,  in  regard  to  the  award  of  the  Federal  Trade 
Commission  concerning  prices  for  sales  of  standard  news-print  paper  in  the 
United  States,  the  commission  issued  supplemental  findings  on  October  18,  1918. 

Those  findings  and  the  subsequent  action  based  upon  them  are  given  below. 

% 

SUPPLEMENTAL  FINDINGS  OF  THE  FEDERAL  TRADE  COMMISSION. 

Subsequent  to  the  finding  and  award  of  the  members  of  the  Federal  Trade 
Commission  acting  as  arbitrators  in  the  above  proceedings,  which  finding  and 
award  was  made  June  18,  1918,  the  said  award  was  appealed  for  review  to  Hon. 
H.  G.  Ward,  Hon.  Henry  W.  Rogers,  Hon.  Charles  M.  Hough,  and  Hon.  Martin 
T.  M:;nton,  judges  of  the  United  States  Circuit  Court,  for  the  Second  Circuit, 
acting  as  reviewing  arbitrators. 

On  September  25,  1918,  the  reviewing  arbitrators  ordered  that  the  finding  or 
award  of  the  Federal  Trade  Commission  be  varied  so  as  to  read  as  follows : 

The  fair  and  reasonable  maximum  prices  for  each  of  the  10  signatory  com- 
panies for  sales  of  standard  news-print  paper  to  customers  in  the  United  States 

are: 

Per  cwt. 

Roll  news  in  car  lots - --  $3.50 

Roll  news  in  less  than  car  lots 3.  62^ 

Sheet  news  in  car  lots 3.  90 

Sheet  news  in  less  than  car  lots 4.02£ 

All  prices  are  f.  o.  b.  mill. 

Accordingly  the  Federal  Trade  Commission  hereby  directs  that  its  findings  be 
varied  as  above  set  forth,  to  be  effective  as  of  April  1  1918,  for  all  the  signatory 
companies,  and  in  the  case  of  the  Minnesota  &  Ontario  Power  Co.  to  be  effective 
as  of  January  1,  1918. 


820  HISTORY   OF   PRICES   DURING   THE   WAR. 

FINDINGS   AS   TO   COST  INCREASES. 

Subsequent  to  the  finding  and  award  of  the  members  of  the  Federal  Trade 
Commission  as  arbitrators,  dated  June  18,  1918,  there  were  submitted  to  the 
commissioners  by  one  of  the  parties  hereto  certain  claims  as  to  the  effect  of 
changes  in  rates  of  wages,  freight  rates,  and  wood  costs  since  April  1,  1918. 
These  changes  cover  the  period  from  April  1  up  to  and  including  the  date  of 
the  supplemental  hearing,  which  was  July  29  and  30,  1918. 

The  figures  presented  have  been  analyzed  and  checked  by  the  commission's 
accountants,  and  the  accountants'  report  has  been  put  in  evidence  by  stipula- 
tion of  parties. 

It  appears  from  this  stipulation  that  there  have  been  increases  in  the  cost 
of  production  of  news  print  chargeable  to  these  three  factors,  as  follows : 


• 

Per  ton. 

Per  hun- 
dredweight. 

(1)  Wood  cost  increase  (since  Apr.  1,  1918)  

$3  75 

jO  187 

(2)  Wage  increase  (since  May  1,  1918)  

2  65 

IQt 

(3)  Freight  increase  (since  July  1,  1918)  

2  41 

12 

WOOD   COST  INCREASES. 

As  noted  above,  the  accountants'  report  shows  an  increase  in  wood  cost  for 
the  International  Paper  Co.,  amounting  to  $3.75  per  ton  of  paper.  In  arriving 
at  the  base  price  of  $3.10  per  hundred  pounds,  effective  April  1,  1918,  the  com- 
mission took  into  account  an  increase  in  cost  of  $2.50  per  ton  of  paper  since 
the  International  Paper  Co.  and  the  Minnesota  &  Ontario  Power  Co.  were 
practically  on  a  new  wood  basis  after  April  1. 

In  calculating  the  base  price  of  $3.50  per  hundred  pounds,  the  reviewing 
arbitrators  also  apparently  took  into  consideration  the  factor  of  increased 
wood  cost.  They  say  in  paragraph  15 : 

"  The  actual  cost  of  making  1  ton  of  news-print  paper  in  an  average  Canadian 
mill,  out  of  recently  gathered  wood  and  without  any  allowance  for  stumpage 
not  actually  paid,  was  not  less  than  $48  on  or  about  April  1,  1918." 

No  wood  has  been  gathered  since  that  date,  wherefore  the  increased  wood 
cost  is  taken  to  be  included  in  the  reviewing  arbitrators'  calculations. 

The  commission,  therefore,  finds  that  no  increase  in  price  is  to  be  made  as  a 
result  of  claimed  increases  in  wood  costs. 

INCREASE   IN    WAGES. 

The  commission  finds  that,  since  May  1,  1918,  there  has  been  an  increased 
labor  cost  of  $2.65  per  ton,  or  13|  cents  per  hundred  pounds,  and  it  appears  to 
be  bound  to  add  this  amount  to  the  selling  prices  as  varied  by  order  of  the  re- 
viewing arbitrators. 

The  commission,  therefore,  finds  and  orders  that  adjustments  since  May  1, 
1918,  between  parties  hereto,  shall  be  made  on  the  following  basis : 

Per  cwt. 

Roll  news  in  car  lots $3.  631 

Roll  news  in  less  than  car  lots 3.  75f 

Sheet  news  in  car  lots 4.  03J 

Sheet  news  in  less  than  car  lots 4. 15f 

All  prices  are  f.  o.  b.  mill. 

INCREASE    IN    FREIGHT. 

The  commission  finds  that  an  increase  in  freight  rates  went  into  effect  June 
25,  1918,  that  said  increase  adds  $2.41  per  ton,  or  12  cents  per  hundred  pounds, 
and  that  such  increase  became  operative  as  to  the  signatory  companies  on 
July  1,  1918 ;  and  it  appears  to  be  also  bound  to  add  this  amount  to  the  selling 
prices  as  varied  by  order  of  the  reviewing  arbitrators. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES. 


821 


The  commission,  therefore,  finds  and  orders  that  adjustments  since  July  I, 
1918,  between  parties  hereto,  shall  be  made  on  the  following  basis : 

Per  hundredweight. 

Roll  news  in  car  lots $3.  75i 

Roll  news  in  less  than  car  lots 3.  87£ 

Sheet  news  in  car  lots 4. 15i 

Sheet  news  in  less  than  car  lots 4. 27f 

All  prices  are  f.  o.  b.  mill. 

PROFIT  BASIS  FOR  NEWSPRINT  PAPEE. 

In  ma  King  their  award  the  reviewing  arbitrators  calculated  a  net  average 
profit  of  $19.75  per  ton  as  a  fair  and  reasonable  profit. 

It  has  been  shown  (Federal  Trade  Commission  Report  on  the  News- 
print Paper  Industry,  June  13,  1917,  p.  105,  and  included  in  the  evidence  in. 
this  case)  that  the  prewar  average  profit  per  ton  for  the  manufacture  and  sale 
of  newsprint  paper  for  United  States  and  Canadian  mills  was  as  follows 
(figures  for  signatory  manufacturers  are  added  for  comparison)  : 


Year. 

United 

States 
mills. 

Inter- 
national 
Paper  Co. 
and  Minne- 
sota and 
Ontario  Co. 

Canadian 
mills. 

Six 
Canadian 
signatories. 

United 
States 
and 
Canadian 
combined. 

Eight 
signatory 
companies 
combined.1 

1913  .. 

$5  53 

$5  13 

$6  45 

$4  98 

$5  70 

15  09 

1914 

4  94 

5  55 

6  62 

5  71 

5  35 

6  61 

1915  

5  59 

6  37 

8  13 

6  82 

6  34 

6  55 

1916  (first  half) 

6  75 

6  99 

9  54 

8  15 

7  55 

7.46 

1  Brompton  and  Gould  not  included. 

It  is  fair  to  presume  that,  on  the  average,  capital  has  been  invested  in  the 
manufacture  of  newsprint  paper  on  an  expectation  of  a  net  average  profit  of 
not  more  than  $10  per  ton. 

The  increases  in  cost  of  wood,  freight,  and  labor  shown  above  are  found  to 
be  the  result  of  war  conditions  and  to  be  unavoidable  by  either  party. 

It  has  been  established  by  governmental  price-fixing  authorities  that  during 
the  war  in  case  of  unusual  cost  increase  caused  by  war  conditions  and  working 
a  hardship,  such  increase  should  be  equitably  distributed  and  not  passed  ou 
in  toto  to  the  purchaser. 

Were  the  commission  free  to  express  its  judgment  in  a  finding  at  this  time  it 
would  hold  that  the  net  average  profit  of  $19.75  was  ample  to  absorb  all  in- 
creases in  wood  costs,  labor  costs,  and  freight  charges  up  to  the  present  time,  in 
which  case  the  result  might  be  stated  thus : 


Per  ton. 

Per 
hundred- 
weight. 

Under  the  price  fixed  by  the  reviewing  arbitrators  there  is  a  net  average  profit 
per  ton  including  increased  wood  costs  of 

$19  75 

$0  987 

Increased  labor  cost  from  May  1,  1918  .  $2.  65 

Increased  freight  cost  from  July  1,  1918.  .  .                                                      2.  41 

K    f\C 

Average  net  profit  after  absorbing  increased  cost  

14.69 

.73 

Highest  average  8  signatory  companies  (first  half  1916)  . 

7.46 

.37 

7  23 

36 

Feeling  itself  bound,  however,  by  the  order  of  the  reviewing  arbitrators,  the 
commission  finds  selling  prices  for  the  three  periods,  April  1,  1918,  May  1,  1918, 
and  July  1,  1918,  as  above  set  forth  and  orders  that  adjustments  between  parties 
be  made,  as  of  such  dates,  accordingly. 

In  all  other  particulars  the  findings  of  the  commission  of  June  18,  1918,  are 
affirmed. 


BIBLIOGRAPHY. 

There  follows  a  brief  bibliography  of  selected  periodical  refer- 
ences to  Government  price  control  in  the  United  States  during  the 
war.  The  Official  Bulletin,  published  by  the  Government,  and  the 
Commercial  and  Financial  Chronicle  give  especially  comprehensive 
statements  of  the  formal  controls  as  they  were  adopted.  The  New 
York  Public  Library  and  the  Congressional  Library  at  Washington, 
at  the  request  of  those  interested  in  this  inquiry,  have  each  prepared 
for  distribution  a  much  fuller  bibliography  on  this  subject  than  can 
here  be  printed. 

AMERICAN  ECONOMIC  REVIEW. 

.Jones,  Eliot.     Report  on  anthracite  and  bituminous  coal.     Dec.,  1917,  v.  7: 
919-923. 

Duffres,  W.  M.  Government  control  of  the  wheat  trade  in  the  United  States. 
1918,  v.  8:  62-87. 

Value  and  price  theory  in  relation  to  price  fixing  and  war  finance.  Mar., 
1918,  v.  8,  sup.:  239-256. 

Report — Government  marketing  of  Australian  wheat.  Dec.,  1918,  v.  8: 
853-858. 

AMERICAN  REVIEW  OF  REVIEWS. 

Dillon,  John  J.  High  cost  of  food,  causes  and  remedies.  Feb.,  1917,  v.  5-~> : 
163-164. 

Seliginan,  E.  R.  A.    Government  price  regulation.     Sept.,  1917,  v.  56 :  289-292. 

ATLANTIC  MONTHLY. 

Lubin,  D.     Food  control  and  democracy.     1917,  v.  120:  260-269. 

CENTURY. 

Creel,  George.  Can  a  democratic  government  control  prices?  Interview  with 
Joseph  E.  Da  vies.  Feb.,  1917,  v.  93:  605-611. 

THE  COMMERCIAL  AND  FINANCIAL  CHRONICLE. 
GENERAL. 

War  and  socialism.     Feb.  17,  1917,  v.  104 :  597. 

Rushing  into  dictatorships.     Mar.  3,  1917,  v.  104 :  796-7. 

The  food  situation — Statutes  no  panacea.     Mar.  10,  1917,  v.  104:897. 

Fears  of  Government  regulation.     Editorial.     Apr.  14,  1917,   v.   104 : 1420. 

One  way  of  rendering  service  to  the  country — The  food  question.  Apr.  14, 
1917,  v.  104 : 1432. 

Secretary  of  the  Xavy  reduces  prices  of  torpedoes  from  E.  W.  Bliss  Co. 
Apr.  21,  1917,  v.  104:1554. 

Herbert  C.  Hoover  to  handle  Nation's  food  problems.     Apr.  21,  1917,  v.  104 : 
J1555. 

Danger  of  Government  control.     Editorial.     May  5,  1917,  v.  104 :  1730 

Patriotism  to  and  by  Government.     May  26,  1917,  v.  104:2051-2053. 
822 


GOVERNMENT  REGULATIONS   RELATING  TO   PRICES.  823 

E.  H.  Gary  on  principles  for  which  we  are  fighting.  May  26,  1917,  v.  104: 
2067. 

Regulating  prices — The  low  supply  and  demand.  June  16,  1917,  v.  104: 
2382-2385. 

Food  control— The  latest  dictatorship  bill.     June  16,  1917,  v.  104 :  2385. 

The  food  control  bill.     June  30,  1917,  v.  104 :  2592. 

President's  warning  against  high  prices.     July  14,  1917,  v.  105 : 135. 

The  resort  to  commissions  and  what  it  means.     July  21,  1917,  v.  105 :  218. 

The  food  control  bill  enacted.     Aug.  11,  1917,  v.  105 :  540. 

The  Food  Administration — Its  purposes  and  plans.     Aug.  18,  1917,  v.  105 :  664. 

Federal  control  of  wheat  and  flour.     Aug.  18,  1917,  v.  105 :  665. 

What  the  New  War  Industries  Board  may  accomplish.  Aug.  18.  1917,  v. 
105 :  667. 

Has  Congress  power  to  create  a  dictator?    Aug.  25,  1917,  v,  105:749-51. 

Fixing  prices  of  food  and  fuel.     Sept.  1,  1917,  v.  105:850-52. 

Labor  strikes,  price  fixing,  and  the  war.     Sept.  22,  1917,  v.  105 : 1140-42. 

The  retailer  and  Government  price  control.     Nov.  3,  1917,  v.  105 : 1745. 

Business  as  usual — What  does  it  mean?    Nov.  10,  1917,  v.  105:1834-36. 

L.  E.  Pierson  on  obligations  of  Government  and  business  in  the  war.  Nov. 
17,  1917,  v.  105 : 1941. 

United  States  Chamber  of  Commerce  on  progress  of  Government  price  con- 
trol. Dec.  1,  1917,  v.  105 :  2144. 

Foreign  trade  council  urges  coordination  of  price  fixing  and  taxation.  Dec. 
1,  1917,  v.  105:2147. 

Our  experiments  in  "  Government  control."     Jan.  19,  1918,  v.  106 :  218. 

Proposed  Government  control  of  security  issues.     Jan.  19,  1918,  v.  106 :  235. 

Congress,  the  President,  and  the  "  War  Council."     Jan.  26,  1918,  v.  106 :  325. 

Impending  price-fixing  bill.     Editorial.     Feb.  2,  1918,  v.  106 :  418. 

Executive  order  regulating  control  of  foreign  exchange  by  Federal  Reserve 
Board.  Feb.  2,  1918,  v.  106:438. 

Discussion   of  Government   control.     Editorial.     Feb.  9,    1918,   v.    106 : 524. 

No  general  price  fixing  on  agricultural  products.  Mar.  2,  1918,  v.  106 :  876. 
*  Senator  Lodge  in  criticism  of  Fuel  Administration  and  price  fixing  of  Gov- 
ornment.  Mar.  2,  1918,  v.  106 :  880. 

Committee  to  pass  on  prices  for  basic  raw  materials  for  Government.  Mar. 
23,  1918,  v.  106 : 1187. 

Retrospect  of  1917.     Mar.  30,  1918,  v.  106 : 1280-86. 

Is  there  a  legal  limit  to  price  control?    April  6,  1918,  v.  106:1394. 

Requirements  division  of  War  Industries  Board  to  carry  out  policies  of 
B.  M.  Baruch.  Apr.  13,  1918,  v.  106 : 1524. 

Charles  H.  Sabin  on  Government  price  regulation.     May  25,  1918,  v.  106 :  2169. 

Whalkis  profiteering  and  who  are  the  profiteers?     June  8,  1918,  v.  106:  2376. 

Retrospect  of  1917.     June  29,  1918,  v.  106 :  2693. 

How  business  runs  the  Government.     Aug.  17,  1918,  v.  107 :  635. 

Oar  apathetic  acceptance  of  control  and  operation.     Aug.  31,  1918,  v.  107:  837. 

Proposed  Government  control  of  retail  dry  goods.     Oct.  12.  1918,  v.  107:  1430. 

Judge  Gary's  view  as  to  readjustment  period.     Nov.  16,  1918,  v.  107: 1884. 

Reconstruction  and  resumption.  Release  from  Government  control.  Nov.  23, 
1918,  v.  107 : 1951. 

Fixed  prices  discontinued.    Dec.  7,  1918,  v.  107 :  2148. 

A  proposal  for  the  governmental  fixing  of  retail  prides.  Dec.  14,  1918,  v. 
107 :  2221. 

Ohas.  E.  Hughes  sees  greater  efficiency  in  private  than  Government  control. 
Dec,  14,  1918,  v.  107 :  2236. 


824  HISTOKY   OF   PRICES   DURING  THE   WAR. 

ACIDS. 
Sulphuric  and  nitric  acid  prices.    June  29,  1918,  v.  106 :  2712. 

ALCOHOL. 

Wood  alcohol  output  taken  by  Government.    Dec.  22,  1917,  v.  105 :  2411. 

ALUMINUM. 

Rejection  of  aluminum  price  recommended  by  Council  of  Defense.  July  7, 
1917,  v.  105 :  22. 

Aluminum  prices  approved  by  the  President.     Mar.  9,  1918,  v.  106 :  983. 
New  aluminum  prices  approved.    June  1,  1918,  v.  106 :  2294. 
Aluminum  prices  continued.    Aug.  24,  1918,  v.  107 :  759. 

ARSENIC. 

Fixing   of  arsenic  prices   by   United    States  Government.   June   1,    1918,   v. 

BINDER  TWINE. 

Control  of  binder  twine  output  by  Government.     Jan.  12,  1918,  v.  106 : 142. 
Scale  of  prices  announced  by  Food  Administration.    Mar.  2,  1918,  v.  106 :  879. 

CASTOR-OIL  BEANS. 
Price  of  $4.50  per  bushel  fixed.    Nov.  2,  1918,  v.  107 : 1714. 

CEMENT. 

Cement  price  fixing  by  the  Government.     May  25,  1918,  v.  106 :  2183. 

COPPER. 

Copper  producers'  offer  to  the  Government.    Mar.  24,  1917,  v.  104 :  1108. 

Government  order  for  copper  at  a  fixed  price.    June  30,  1917,  v.  104 :  2603. 

Government  lowers  price  of  copper.     July  14,  1917,  v.  105 :  133. 

Government  fixed  price.     Sept.  22,  1917,  v.  105 : 1165. 

Attitude  of  copper  trade  toward  Government's  price.  Sept.  29,  1917,  v. 
105 :  1264. 

Conference  of  copper  interests  with  Government  officials.  May  4,  1918,  v. 
\  106 : 1856. 

Government's  price  continuing.  Wall  Street  comment.  May  25,  1918,  v. 
106 :  2182. 

Increase  in  copper  price  by  War  Industries  Board.    July  6,  1918,  v.  107 :  35. 

Copper  to  remain  at  26  cents.    Comment.    Aug.  10,  1918,  v.  107 :  562. 

Copper  price  continued.    Comment.    Nov.  2,  1918,  v.  107 : 1715. 

Copper  price  continued.    Nov.  23,  1918,  v.  107 : 1967. 

COTTON. 

A  suggestion  that  the  Government  contract  ahead  for  the  growing  cotton 
crop.  June  30,  1917,  v.  104 :  2593. 

Denial  of  cotton  price-fixing  movement.    Feb.  9,  1918,  v.  106 :  553. 

War  Trade  Board's  announcement  concerning  cotton  shipments  to  Spain.  Apr. 
13,  1918,  v.  106:1524. 


GOVERNMENT   REGULATIONS   RELATING   TO   PRICES.  825 

Conference  looking  to  stabilization  of  cotton  industry.  Apr.  33,  1918,  v. 
306:  1528. 

Bill  fixing  price  of  raw  cotton  at  20  cents.    Apr.  20,  1918,  v.  106 :  1627. 

Cotton  manufacturers'  resolutions  on  price  fixing,  coal  priority,  etc.  May  11, 
3918,  v.  106:  1961. 

Tentative  plan  for  price  fixing  of  cotton  goods.    June  15,  1918,  v.  106 :  2506. 

Government  plans  concerning  cotton  price  fixing.    June  29,  1918,  v.  106 : 2708. 

Beverly  D.  Harris  on  stabilization  of  cotton  prices.    July  13,  1918,  v.  107 : 130. 

Proposed  fixing  of  cotton  price.     Sept.  7,  1918,  v.  107 :  949. 

Developments  growing  out  of  reports  of  cotton  price  fixing.  Sept.  21,  1918, 
v.  107 : 1150 ;  Sept.  28,  1918,  v.  107 : 1250 ;  Oct.  12,  1918,  v.  107 :  1438. 

Cotton  price  fixing  unnecessary.    Nov.  9,  1918,  v.  107. 1788. 

Cotton  goods  prices  continued.     Nov.  23,  1918,  v.  107 :  1964. 

Cotton  price  fixing  to  cease  Jan.  1.    Dec.  14,  1918,  v.  107 :  2238. 

COTTON  LINTKRS. 

Questionnaire  on  cotton  linters  issued  by  War  Industries  Board.  June  1, 
1918,  v.  106 :  2289. 

COTTONSEED. 

Regulations  to  prevent  hoarding  and  speculation  in  cottonseed.    Nov.  10,  1917, 
v.  105 : 1853. 
"Rules  for  cottonseed  buyers  and  sellers.    Aug.  10,  1918,  v.  107 :  562-3. 

Prevailing  price  of  cottonseed  held  to  be  too  low  by  Texas  commissioner. 
Aug.  24,  1918,  v.  107 :  755. 

Price  stabilization  of  cottonseed.     Sept.  21,  1918,  v.  107 : 1151. 

Speculation  in  cottonseed.    Nov.  10,  1917,  v.  105 : 1853. 

FERTILIZERS. 

Proclamation  licensing  fertilizer  industry.    Mar.  2,  1918,  v.  106 :  880. 

FOOD. 

GENERAL. 

The  food  riots  and  measures  of  relief.    Feb.  24,  1917,  v.  104 :  699. 

The  food  shortage — the  seat  of  the  disease.    Mar.  3,  1917,  v.  104 :  796-7. 

J.  Ogden  Armour  urges  Government  control  of  food.  Apr.  14,  1917,  v. 
104 : 1447-8. 

The  food  problem  and  the  farmer — normal  methods  best.  Apr.  21,  1917,  v. 
304:1536-7. 

Secretary  Houston  would  fix  food  prices.    Apr.  21,  1917,  v.  104 : 1556. 

Herbert  C.  Hoover  appointed  Food  Administrator.    May  26,  1917,  v.  104 :  2072. 

The  administration's  food-control  bills.    June  9,  1917,  v.  104 :  2298-9. 

Herbert  C.  Hoover  outlines  Food  Administration  program.  June  9,  1917,  v. 
104 : 2301-2. 

The  Administration's  food-control  bills.  June  30,  1917,  v.  104 :  2608^-9 ;  July 
14,  1917,  v.  105 : 138 ;  July  28,  1917,  v.  105 :  340-1 ;  Aug.  11,  1917,  v.  105 :  555-6. 

New  York  Legislature  in  session  to  consider  food  bill.  Aug.  4,  1917,  v. 
105 :  452-3. 

Text  of  food-control  bill.    Aug.  11,  1917,  v.  105 :  556-7-8. 

Text  of  food-survey  bill.    Aug.  11,  1917,  v.  105:  559. 

Food  control  launched.    Aug.  18,  1917,  v.  105 :  646-7. 


826  HISTORY   OF   PRICES   DURING   THE   WAR. 

Federal  control  of  food  to  begin  Nov.  1.    Oct.  13,  1917,  v.  105 : 1472. 
The  President  defines  fair  profit  for  foodstuffs  as  normal  average  obtained 
prior  to  July,  1914.    Dec.  8,  1917,  v.  105 :  2231. 

Review  of  course  of  food  prices  by  Mr.  Hoover.    Nov.  1C,  1918,  v.  107 : 1878-9. 

BAKING  INDUSTRY. 

Government  regulation  of  baking  industry.    Nov.  17,  1917,  v.  105 :   1944-46. 
^Food  Administration's  announcement  regarding  baking  rules  under  new  license 
regulations.     Feb.  9,  1918,  v.  106 :  549. 

CANNERS. 

Maximum  margins  allowed  canners.    Apr.  27,  1918,  v.  106 : 1747. 

COFFEE. 

Licensing  of  green-coffee  dealers  to  prevent  outside  speculation.  Feb.  9,  1918, 
\.  106 :  549. 

Speculation  in  green  coffee  prohibited.    Feb.  9,  1918,  v.  106:  550. 

New  York  Coffee  and  Sugar  Exchange's  resolution  banning  circulars  encour- 
aging speculation.  Feb.  23,  1918,  v.  106 :  771. 

New  division  in  Food  Administration  to  pass  on  coffee.  Mar.  2,  1918,  v. 
106 :  878. 

Regulations  for  green-coffee  dealers.    May  4,  1918,  v.  106 : 1852. 

Coffee  import  ruling.     Juno  1,  1918,  v.  106 :  2288. 

Coffee-trade  committee  to  cooperate  with  United  States  Food  Administration. 
June  15,  1918,  v.  106:2505. 

Modification  of  coffee  rules  urged.    June  22,  1918,  v.  106 :  2611 

Coffee  price  stabilization.    Oct.  19,  1918,  v.  107 : 1535. 

Coffee  futures  ordered  liquidated  at  fixed  maximum  prices.  Nov.  9,  1918,  y. 
107:1787. 

Coffee  Exchange  resumes  trading  in  futures.     Dec.  28,  1918,  v.  107 :  2427. 

Coffee  regulations.     Dec.  28,  1918,  v.  107 :  2428. 

EGGS    AND    DAIRY    PRODUCTS. 

Exchanges  agree  to  abolish  speculation  in  butter  and  eggs.  Nov.  17,  1917,  v. 
105 : 1948. 

Wholesale  prices  for  butter  for  New  York  and  Chicago  fixed  by  Food  Admin- 
istration. Feb.  2,  1918,  v.  106 :  446. 

Regulations  to  prevent  speculation  in  butter.    June  22.  1918,  v.  106 :  2610. 

Margin  of  profit  established  on  cheese.    June  22,  1918,  v.  106 :  2611. 

Regulations  governing  butter.     Aug.  3,  1918,  v.  107.  460. 

Cheese  put  under  regulation.     Aug.  10.  1918,  v.  107 :  559. 

GRAINS. 

Exchanges  fix  maximum  prices  for  wheat  futures.  May  19, 1917,  v.  104 : 1972. 
Corn  maximum  fixed  by  Chicago  Board  of  Trade.  June  9,  1917,  v.  104 : 2302. 
Government  control  of  wheat  trade  planned.  June  30,  1917,  v.  104 :  2604. 
Chicago  Board  of  Trade  stops  trading  in  July  corn.  July  7,  1917,  v.  105 :  25. 
Chicago  Board  of  Trade  takes  further  steps  to  control  grain  speculation. 
July  14,  1917,  v.  105 : 131. 

Wheat  prices  of  various  countries.     July  14,  1917;  v.  105 : 132. 


GOVERNMENT   REGULATIONS   RELATING  TO  PRICES.  827 

Chicago  Board  of  Trade  empowered  to  stop  trading  in  grain  futures  and  to 
fix  prices.  July  21,  1917,  v.  105 : 236. 

Chicago  Board  of  Trade  stops  trading  in  September  corn.  Aug.  4,  1917,  v. 
105 :  456. 

Chicago  Board  of  Trade  to  suspend  future  trading  iu  wheat.  Aug.  18,  1917, 
v.  105 :  669. 

Price  for  1917  wheat  fixed.     Sept.  1,  1917,  v.  105 : 864-66. 

Future  trading  in  wheat  ends  in  Chicago.     Sept.  1,  1917,  v.  105 :  867. 

Government  agency  assumes  control  of  wheat  markets.  Sept.  8,  1917,  v. 
105 : 959. 

Chicago  Board  of  Trade  and  Government  officials  agree  to  limit  speculation 
in  grain.  Nov.  24,  1917,  v.  105 : 2048. 

Chicago  Board  of  Trade  decides  to  retain  maximum  of  $1.28  on  corn  futures. 
Jan.  12,  1918,  v.  106 : 136. 

Discontinuance  of  January  trading  in  corn  by  Chicago  Board  of  Trade. 
Feb.  2,  1918,  v.  106 :  446. 

The  price  of  wheat— What  shall  it  be?    Feb.  23,  1918,  v.  106 :  746. 

Bill  increasing  minimum  price  of  wheat  to  $2.50  a  bushel  favorably  re- 
ported. Feb.  23,  1918,  v.  106 :  770. 

Maximum  price  for  oats  fixed  at  93  cents  by  Chicago  Board  of  Trade.  Mar. 
2,  1918,  v.  106 :  875. 

Gore  proposal  to  increase  minimum  price  of  wheat.  Mar.  23,  1918,  v. 
106 : 1189. 

Food  Administration's  new  wheat  restrictions.    Mar.  30,  1918,  v.  106 : 1296. 

Disagreement  of  congressional  conferees  on  wheat  price.  Aug.  13,  1918,  v. 
106 : 1523. 

Trading  in  corn  and  oats  on  Chicago  Board  of  Trade.  Apr.  13,  1918,  v. 
106 :  1523. 

House  rejects  higher  wheat  price,    Apr.  20,  1918,  v.  106 : 1626. 

Move  toward  commandeering  wheat.    May  11,  1918,  v.  106 : 1959. 

Government  price  regulation.    Charles  H.  Sabiu.    May  25,  1918,  v.  106:2169. 

United  States  Grain  Corporation  seeks  modification  of  grain  regulations. 
June  15,  1918,  v.  106 : 2705. 

President  Wilson  grants  United  States  Grain  Corporation  authority  to  pay 
higher  prices  for  wheat.  June  29,  1918,  v.  106 :  2705. 

Proposed  regulation  of  wheat  flour  milling  industry.    July  6,  1918,  v.  107 :  33. 

Higher  wheat  prices  announced  by  the  Food  Administration.  July  6,  1918,  v. 
107 : 33. 

The  farmer  and  the  price  of  wheat.    July  13,  1918,  v.  107 : 113. 

Senate  and  House  agree  on  $2.40  for  wheat  crop.    July  13,  1918,  v.  107 : 136. 

Excess  profits  of  millers  to  be  returned  to  Government  in  form  of  flour. 
July  13,  1918,  v.  107 : 136. 

Plans  of  Food  Administration  for  handling  1918  rice  crop.  Aug.  3,  191S,  v. 
107 : 458. 

New  flour  milling  control.    Aug.  10,  1918,  v.  107 :  558-9. 

Price  for  1919  wheat  fixed  by  the  President.    Sept.  7,  1918,  v.  107 : 945. 

Maximum  grain  prices  abolished  by  Chicago  Board  of  Trade.  Oct.  12,  1918,  v. 
107 : 1436. 

Movement  for  stabilization  of  corn  prices.    Oct.  26,  1918,  v.  107 : 1620. 

Wheat  price  guaranteed  to  American  farmers  as  compared  with  that  paid 
by  England.  Dec.  7,  1918,  v.  107 :  2145-6. 

ICE. 

Food  Administratir-i  to  prevent  profiteering  in  ice.     May  4,  1918,  v.  106:  1854. 


828  HISTORY   OF   PRICES   DURING  THE  WAR. 

MEAT. 

United  States  Food  Administration  fixes  minimum  price  for  hogs.  Nov.  10, 
1917,  v.  105  :  1850. 

Investigating   commission   recommends    minimum   price    for   hogs,     Nov.    17, 

1917,  v.  105  :  1946. 

Meat  packers'  profits  fixed  by  Government.     Dec.  15,  1917,  v.  105 : 2325. 

No  increase  in  meat  prices  because  of  temporary  scarcity.  Feb.  2,  1918,  v. 
106 : 447. 

Meat  restrictions  relaxed.     Mar.  9,  1918,  v.  106 :  979. 

Hoover's  recommendations  for  control  of  meat  industry.  Apr.  6,  1918,  v. 
106 : 1418. 

Packers  protest  against  Federal  Trade  Commission's  report  on  profiteering. 
July  6,  1918,  v.  107 :  31. 

Minimum  hog  prices  recommended  by  advisory  committee.  Oct.  19,  1918,  v. 
107 : 1583. 

MILK. 

The  milk  situation  in  New  York  State — Government  not  to  intervene.  Sept. 
29,  1917,  v.  105 : 1270. 

Federal  milk  commission  allows  increase  in  price  for  January.  Jan.  5,  1918, 
v.  106 :  24. 

Federal  milk  commission  reduces  February  prices  for  milk.  Feb.  2,  1918,  v. 
106 :  446. 

June  milk  prices  fixed  by  Federal  milk  commission.  June  8,  1918,  v. 
106 : 2395. 

July  prices  fixed.     July  6,  1918,  v.  107 :  33. 

August  and  September  milk  prices.     Aug.  3,  1918,  v.  107 :  460. 

October  milk  prices — Reduction  proposed.     Oct  12,  1918,  v.  107 : 1436. 

November  prices — Dairymen's  demands  criticized  by   Mr.   Hoover.     Nov.   2, 

1918,  v.  107  : 1714. 

Further  increase  in  November  milk  prices — Protest  by  Mayor  Hylan.  Nov. 
16,  1918,  v.  107 : 1880. 

Federal  control  of  milk  discontinued.     Dec.  28,  1918,  v.  107 :  2428. 

OEANGES. 

Margin  of  profit  on  oranges  fixed.     Nov.  19,  1918,  v.  107 : 1788. 

PRUNES   AND   KAISINS. 

Prices  announced  by  Food  Administration.     June  22,  1918,  v.  106 :  2611. 

SARDINES. 

Food  Administration  fixes  price.     June  15,  1918,  v.  106 :  2505. 

SUGAR. 

New  York  Coffee  and  Sugar  Exchange  stops  trading  in  sugar  futures. 
Aug.  18,  1917,  v.  105 :  669. 

Conference  of  representatives  of  New  York  Coffee  and  Sugar  Exchange  in 
Washington.  Aug.  25,  1917,  v.  105 :  765. 

Reduction  agreed  to  by  sugar  producers.     Sept.  1,  1917,  v.  105 :  866. 

Sugar  refiners  agree  to  import  sugar  through  Food  Administration.  Sept. 
8,  1917,  v.  105 :  960. 

President's  proclamation  calling  for  licensing  of  sugar  industry.  Sept.  22, 
1917,  v.  105 : 1163-64. 

The  sugar  situation.    Nov.  24,  1917,  v.  105 : 2049. 


GOVERNMENT  REGULATIONS  RELATING  TO   PRICES.  829 

Basic  price  for  Cuban  sugar  fixed.     Dec.  8,  1917,  v.  105 :  2230. 

Senate  committee's  investigation  of  the  sugar  shortage.  Dec.  22,  1917,  v.  105  : 
2418-20. 

Mr.  Hoover's  explanation  of  sugar  shortage.     Dec.  29,  1917,  v.  105 :  2500-2. 

Amount  to  be  charged  on  $100,000,000  Cuban  sugar  credit.  Mar.  23,  1918, 
v.  106:  1177. 

Further  sale  of  sugar  acceptances.    June  8,  1918,  v.  106 :  2383. 

Oscar  S.  Straus  to  determine  sugar  cost.     June  22,  1918,  v.  106 :  2611. 

New  sugar  restrictions.     June  29,  1918,  v.  106 :  2706-7. 

Increase  in  basic  prices  of  sugar.     June  29,  1918,  v.  106 :  2707. 

New  sugar  restrictions  effective  August.     Aug.  3,  1918,  v.  107 :  458. 

Increase  sought  in  price  for  Cuban  sugar  crop.     Aug.  3,  1918,  v.  107 :  459. 

One-huudred-million-dollar  sugar  syndicate  disbanded.  Aug.  10,  1918,  v. 
107:  553. 

Food  Administration  to  equalize  prices  of  old  and  new  sugar  crops.  Sept.  7, 
1918,  v.  107:  948. 

Cane-sugar  price  fixed  by  Equalization  Board.     Sept.  14,  1918,  v.  107 :  1056. 

Cuban-sugar  contract.     Oct.  26,  1918,  v.  107:  1620. 

FUELS. 

Reduction  in  bituminous  price  agreed  upon.     June  30,  1917,  v.  104 :  2603-4. 

Secretary  Baker  repudiates  bituminous  prices  agreement.  July  7,  1917,  v. 
105:  20. 

Oil  for  Navy  Department— To  fix  prices  later.     July  7,  1917,  v.  105 :  21. 

Bituminous-coal  prices  fixed.     Aug.  25,  1917,  v.  105:  766. 

Anthracite-coal  prices  fixed.     Aug.  25,  1917,  v.  105 :  767. 

Coal  committee  appeals  to  operators  and  miners.     Aug.  25,  1917,  v.  105:  768. 

The  endeavor  to  regulate  the  coal  industry.     Oct.  13,  1917,  v.  105 :  1455. 

Maximum  prices  for  by-product  coke.     Nov.  24,  1917,  v.  105 :  2053. 

Garfield's  preference  order.    Editorial.    Jan.  19,  1918,  v.  106 :  214. 

Benumbing  effects  of  Fuel  Administrator's  order.     Jan.  19,  1918,  v.  106 :  221. 

The  Fuel  Administrator's  powers.     Jan.  26,  1918,  v.  106:  327. 

The  compensation.     Discussion  of  fuel  order.     Jan.  26,  1918,  v.  106 :  328. 

Bill  authorizing  President  to  fix  oil  prices.     Mar.  30,  1918,  v.  106 :  1300. 

Gasoline  and  fuel  prices  announced.     June  1,  1918,  v.  106 :  2295. 

M.  L.  Requa  warns  hoarding  oil  producers  that  Government  will  not  advance 
price.  June  1,  1918,  v.  106 :  2295. 

National  petroleum  war  service  committee  asked  to  cooperate  in  stabilizing 
crude  oil  prices.  June  29,  1918,  v.  106 :  2710. 

Criticism  of  Fuel  Administration.     Editorial.     July  13,  1918,  v.  107:  104. 

Recommendations  for  stabilizing  prices  of  crude  oil.  July  20,  1918,  v. 
107:  241. 

A.  C.  Bedford  on  what  has  been  accomplished  by  the  oil  industry  without 
Government  regulation — Stabilizing  of  prices.  July  27,  1918,  v.  107 :  356-7. 

National  petroleum  committee  plans  to  stabilize  price  and  maintain  output. 
Aug.  17,  1918,  v.  107 :  655. 

Fuel  Administration's  announcement  concerning  stabilization  of  oil  prices. 
Aug.  31,  1918,  v.  107 :  855-6. 

GLYCERIN. 

Dynamite  glycerin  prices.     Aug.  24,  1918,  v.  107 :  761. 

HIDES,  SKINS,  AND  LEATHER. 

Tanners'  council   approves  leather-import  restrictions  and  fixing  of  prices. 
Apr.  27,  1918,  v.  106 :  1747. 
Maximum  prices  on  hides.     May  4,  1918,  v.  106:  1853. 


830  HISTORY   OP   PRICES    DURING   THE    WAR. 

Tanners  agree  to  leave  price  fixing  to  Government.     May  4,  1918,  v.  106 :  1853. 
War   Industries  Board  announces  prices  on   pickled   sheep  pelts.     June  15, 
1918,  v.  106 :  2506. 

Prices  announced  for  black  harness  leather.     June  29,  1918,  v.  106:  2708. 
New  hide  prices  announced.     July  27,  1918,  v.  107:  354. 
Sole  and  belting  leather  prices.     Aug.  24,  1918,  v.  107 :  757. 

IRON  AND  STEEL. 
Steel   men  confirm  reduced  prices  to  United   States  Government.     Apr.   28. 

1917,  v.  104:  1654. 

The  Government  and  steel  prices.     June  23,  1917,  v.  104 :  2505. 

Steel  interests  agree  to  Government  price.     July  14,  1917,  v.  105 :  133. 

Steel  prices  approved  by  President  Wilson.     Sept.  29,  1917,  v.  105:  1263-64. 

Steel  manufacturers  asked  to  give  pledges  that  Government  work  receive 
priority.  May  4,  1918,  v.  106 : 1854. 

Changes  in  steel  differentials.     Aug.  10,  1918,  v.  107 :  564. 

Iron  and  steel  prices  in  effect  until  Dec.  31.     Sept.  28,  1918,  v.  107 : 1252. 

New  prices  and  extras  in  iron  bars.     Oct.  19,  1918,  v.  107 : 1539. 

Steel  committee  advises  continuance  of  Government  supervision  of  indus- 
try. Nov.  16,  1918,  v.  107 : 1885. 

Steel  control  and  price  fixing  to  end  Jan.  1.     Judge  Gary's  views.       Dec.  7, 

1918,  v.  107 :  2240. 

LEAD. 

Government  gets  supply  of  lead.    Aug.  11,  1917,  v.  105 :  566. 
Lead  price  fixing  unnecessary.    Dec.  22,  1917,  v.  105 :  2412. 
Price   at   which   Government's   lead  products    requirements   are   to  be  met. 
Apr.  13,  1918,  v.  106 : 1525. 

LIME. 

Lime  and  acetone  taken  by  Government.    Dec.  22,  1917,  v.  105 : 2412, 

LUMBEE. 

Spruce  lumber  prices  to  be  paid  by  the  Government.  Apr.  27,  1918,  v. 
106 : 1747. 

Lumber  prices  agreed  upon.  June  15,  1918,  v.  106 : 2507 ;  June  22,  1913, 
v.  106 :  2615. 

Prices  for  northwestern  fir  and  southern  pine.     June  29,  1918,  v.  106 :  2708-9. 

Prices  for  long  and  short  leaf  Virginia  and  Carolina  pine  lumber.  July  13, 
1918,  v.  107  :  137. 

Maximum  prices  for  southern  pine  lumber.     July  13,  1918,  v.  107 : 138. 

New  England  spruce  lumber  prices.     Aug.  3,  1918,  v.  107 :  461. 

Increase  in  basic  price  for  hemlock.     Sept.  7,  1918,  v.  107 :  949. 

Lumber  prices  continued.     Oct.  26,  1918,  v.  107 : 1621-2. 

MANGANESE. 

Manganese  ore  prices  announced  by  War  Industries  Board.  June  1,  1918, 
v.  106 :  2294. 

Freight  rates  on  manganese  ore.     Aug.  24,  1918,  v.  107 :  759. 

NICKEL. 
Nickel  prices  agreed  upon.    Apr.  6,  1918,  v.  106 : 1419. 

NITRATE. 

Nitrate  soda  purchased  in  Chile  by  United  States  for  farmers.  Jan.  12, 
1918,  v.  106 :  136. 

Plans  of  nitrate  sales  to  farmers.    Jan.  26,  1918,  v.  106 :  352. 
Formation  of  nitrate  board  by  Allies.     Jan.  26,  1918,  v.  106 :  352. 


GOVERNMENT  REGULATIONS   RELATING  TO   PRICES.  831 

PAPER. 

A  principle  at  issue  in  regulation  of  the  price  of  newsprint  paper.  Feb.  24, 
1917,  v.  104  :  701. 

Proposal  to  Federal  Trade  Commission  to  fix  paper  prices.  Feb.  24,  1917, 
v.  104 :  714. 

Government  price  fixing — The  newsprint  paper  case.  Mar.  10,  1917,  v.  104: 
898. 

The  Canadian  newsprint  paper  manufacturers.     Mar.  10,  1917,  v.  104 : 903. 

Newsprint  paper  manufacturers  indicted  under  Sherman  anti-trust  law. 
Apr.  28,  1917,  v.  104 : 1667. 

Federal  Trade  Commission  and  newsprint  paper  price.  Apr.  28,  1917,  v. 
104 :  1668-70. 

Senate  asks  Trade  Commission  to  adopt  strictures  against  newsprint  manu- 
facturers. July  7,  1917,  v.  105 :  23-4. 

The  Government's  attempt  to  fix  the  price  of  newsprint  paper.  July  14, 
1917,  v.  105  : 114. 

Price  of  paper  to  Government  fixed  at  2J  cents  per  pound.  Sept.  8,  1917, 
v.  105 :  959-60. 

Trade  Commission  opens  to  publishers  newsprint  paper  records.     Sept.  29, 

1917,  v.  105  :  1268. 

Trade  Commission  on  paper  prices — Renews  recommendation  for  pooling  of 
product.  Sept.  29,  1917,  v.  105 : 1268. 

The  newsprint  paper  problem  again.     Oct.  20,  1917,  v.  105 : 1563. 

Canadian  Government  not  satisfied  with  experiment  of  fixing  prices  on  pa- 
per. Nov.  3,  1917,  v.  105 : 1746. 

Seeking  Government   control  of  the  output  of  newsprint  paper.     Jan.   19, 

1918,  v.  106 :  222. 

Newsprint  paper  prices  fixed  by  Federal  Trade  Commission.  June  22,  1918, 
v.  106 :  2613. 

PLATINUM. 

Platinum  commandeered  by  the  Government.     Mar.  2,  1918,  v.  106 :  880. 

The  commandeering  of  platinum  by  the  Government.  Mar.  9,  1918,  v. 
106:982. 

Platinum  metals  commandeered  by  the  Government.  May  18,  1918,  v. 
106 :  2074. 

RUBBER. 

Crude  rubber  prices  fixed  by  War  Trade  Board.     May  4,  1918,  v.  106 : 1853. 
New  rubber  prices  announced.     May  18,  1918,  v.  106 :  2073. 

SHOES. 

Maximum  prices  on  shoes.     Oct.  12,  1918,  v.  107 : 1437. 
Abandonment  of  schedule.     Dec.  28,  1918,  v.  107 :  2433. 

SILVER. 

Control  of  silver  by  Government.     Nov.  17,  1917,  v.  105 : 1938. 

Bill  providing  for  melting  of  silver  dollars  and  fixing  price  at  $1  an 
ounce.  Apr.  13,  1918,  v.  106 :  1513. 

Treasury  Department's  announcement  concerning  price  iixed  for  silver.  Aug. 
24,  1918,  v.  107 :  744. 

SULPHUR. 

Sulphur  control  taken  over  by  War  Industries  Board,  July  13,  191.8,  v. 
107 : 140. 


832  HISTOKY   OF   PRICES   DURING  THE  WAR. 

WOOL. 

Boston  wool  supply  to  be  held  for  the  United  States.  Apr.  7,  1917,  v. 
104: 1341. 

New  regulations  governing  wool  imports.     Jan.  12,  1918,  v.  106 : 138. 

Woolen  mills  called  upon  to  hold  looms  for  Government — Trading  in  Bos- 
ton stops.  Apr.  13,  1918,  v.  106 : 1528. 

Control  of  Canadian  wool  exports.     May  18,  1918,  v.  106 :  2073. 

Other  developments  in  control  of  wool  by  Government.  May  25,  1918,  v. 
106 :  2180. 

Likelihood  of  wool  shortage  refuted  by  secretary  of  National  Wool  Growers' 
Association.  May  26,  1918,  v.  106:2181. 

Regulation  for  handling  wool  clip.     June  8,  1918,  v.  106 :  2396. 

Government  wool  auctions.     Dec.  28,  1918,  v.  107 :  2431. 

WOOL   GKEASE. 

Prices  on  wool  grease.     Nov.  9,  1918,  v.  107 : 1788. 

ZINC. 

Zinc  prices  approved  by  the  President     Feb.  16,  1918,  v.  106 :  663. 
Zinc  prices  continued.    May  25,  1918,  v.  106 :  2182 ;  June  1,  1918,  v.  106 :  2295  ; 
Aug.  31,  1918,  v.  107 :  858. 

ECONOMIC  WORLD. 

National  Government  and  regulation.     Mar.  10,  1917,  N.  S.-v.  13:  327-328. 

Economic  difficulties  in  the  way  of  successful  government  price  fixing, 
Jaly  21,  1917,  N.  S.  v.  14 : 78-79. 

Government's  problem  of  fixing  prices.     Aug.  11,  1917,  N.  S.  v.  14 : 183-184. 

Concatenation  of  problems  produced  by  governmental  price  fixing.  Sept.  22, 
1917,  N.  S.  v.  14:399-400. 

National  Fuel  Administrator  Garfield  on  the  price-fixing  policy  of  the 
Government.  Sept.  29,  1917,  N.  S.  v.  14 :  436-438. 

Putnam,  G.  E.  Government  control  of  food  prices  as  the  economist  views  it. 
1917,  N.  S.  v.  14 :  508-511. 

Gary,  E.  H.  American  steel  industry,  the  Government  and  the  war.  1917, 
N.  S.  v.  14 :  616-618. 

Gay,  Edwin  F.  War  prices  and  the  problems  involved  in  their  control.  Dec. 
28,  1917,  N.  S.  v.  14 :  906. 

Anderson,  B.  M.,  Prospect  of  success  of  Government  price  fixing  in  the 
United  States.  Jan.  5,  1918,  N.  S.  v.  15 : 11. 

Creation  of  the  price-fixing  committee  under  the  War  Industries  Board. 
Mar.  23,  1918,  N.  S.  v.  15 :  409. 

Administration  plans  for  an  extension  of  price  fixing.  Apr.  20,  1918,  N.  S. 
v.  15 :  507-508 ;  589-590. 

Both  governmental  and  cooperative  price  fixing  to  cease  on  Jan.  1.    Jan.  4, 

1919,  N.  S.  v.  17 :  13. 

FORUM. 

Wheat  farmers'  dilemma.    Sept.,  1918,  v.  60 : 257-266. 

JOURNAL  OF  POLITICAL  ECONOMY. 

Hitchcock,  Curtice  M.  The  War  Industries  Board,  its  development,  organi- 
zation, and  functions.  June,  1918,  v.  26 : 545-567. 

Notz,  Wm.  World's  coal  situation  during  the  war.  June,  1918,  v.  26:567- 
612 ;  July,  1918,  v.  26 :  673-705. 

Hamilton,  Walton  H.  The  requisites  of  a  national  food  policy.  June,  1918, 
v.  26 :  612-638. 


GOVERNMENT  REGULATIONS   RELATING   TO   PRICES.  833 

POLITICAL  SCIENCE  QUARTERLY. 

Haney,  L.  H.     Price  fixing  in  the  United  States  during  the  war.     Mar.,  1918, 
v.  34 :  104-126. 

PUBLIC. 

Jones,   F.  K.     Precedence  of  copper  in  price  fixing.     Aug.  10,  1918,  v.  21: 
1013-1016. 

Indictment  of  price  fixing.    1918,  v.  21 :  846-848. 

QUARTERLY  JOURNAL  OF  ECONOMICS. 

Blakey,  F.  G.     Sugar  prices  and  distribution  under  food  control.     Aug.,  1918, 
v.  32 :  567-596. 

Berglund,  A.     Price  fixing  in  the  iron  and  steel  industry.     Aug.,  1918,  v.  32 : 
597-620. 

Eldred,  W.    Wheat  and  flour  trade  under  Food  Administration  control.     Nov., 
1918,  v.  33:1-70. 

Morse,  L.  K.     Price  fixing  of  copper.     Nov.,  1918,  v.  33 :  71-106. 

Taussig,    F.    W.      Price    fixing    as    seen    by    a    price    fixer.     Feb.,  1919,  v. 
33 :  205-241. 

SCRIBNER'S. 

Harger,  C.  M.     Farmer  and  $3  wheat.     1918,  v.  64 :  80-86. 

Payne,  John  L.     Regulation  of  food  prices.     Nov.,  1918,  v.  64 :  581-586. 

UNPOPULAR  REVIEW. 
Means,  D.  M.     Price  fixing  by  Government.     Apr.,  1918,  v.  9 :  312-327 

WORLD'S  WORK. 
Price  fixing  and  production.     Nov.,  1917,  v.  35 :  12-13. 

PUBLICATIONS    OF    A    GENERAL    NATURE    CONTAINING    CONTRIBUTIONS    TO 
THE  BIBLIOGRAPHY    OF   GOVERNMENT  PRICE    REGULATION. 

Annalist. 

Congressional  Record. 

Journal  of  Commerce. 

Literary  Digest 

Monthly  Review,  Department  of  Labor. 

New  York  Times. 

Official  Bulletin. 

War  Trade  Board  Journal. 

TRADE  JOURNALS  WHOSE  COLUMNS  THROUGH   1917  AND   1918   PROVIDE 
PERTINENT  REFERENCES  TO  GOVERNMENT  PRICE  CONTROL. 

American  Fertilizer. 

American  Sheep  Breeder. 

American  Wool  and  Cotton  Reporter. 

Chemical  and  Metallurgical  Engineering. 

Coal  Age. 

Engineering  and  Mining  Journal. 

India  Rubber  World. 

Iron  Age. 

Iron  Trade  Review. 

National  Wool  Grower. 

Oil,  Paint,  and  Drug  Reporter. 

Textile  World  Journal. 

125547°— 20 53 


PRICE  BULLETINS  ISSUED  BY  THE  WAR  INDUSTRIES  BOARD. 


1.  Summary. 

2.  International  price  comparisons. 

3.  Government  control  over  prices. 

4.  Prices  of  foods. 

5.  Prices  of  clothing. 

6.  Prices  o£  building  materials. 

7.  Prices  of  chemicals. 


8. 

9. 
10. 
11. 

12. 


14. 
1.5. 
16. 
17. 
18. 
19. 


21. 
22. 

23. 


FOODS. 

Prices  of  feed  and  forage. 
Prices  of  wheat  and  wheat  products. 
Prices  of  corn  and  corn  products. 
Prices  of  oats,  rice,  buckwheat,  and 

their  products. 
Prices  of  barley,  hops,  rye,  and  their 

products. 

Prices  of  sugar  and  related  products. 
Prices  of  vegetables  and  truck. 
Prices  of  edible  vegetable  oils. 
Prices  of  fruits,  nuts,  and  wine. 
Prices  of  spices  and  condiments. 
Prices  of  tea,  coffee,  and  cocoa. 
Prices  of  tobacco  and  tobacco  prod- 

ucts. 

Prices  of  live  stock,  meats,  and  fats. 
Prices  of  poultry  and  dairy  prod- 

ucts. 
Prices  of  fish  and  oysters. 


CLOTHING. 


prod- 


Prices  of  cotton  and  cotton 
nets. 

24.  Prices  of  wool  and  wool  products. 

25.  Prices  of  silk  and  silk  products. 

26.  Prices  of  hides  and  skins  and  their 

products. 

27.  Prices  of  hatters'  fur  arid  fur  felt 

hats. 

V*       -  \  es  of  hair,  bristles,  and  feathers. 
«w  tees  of  buttons. 

RUBBER,    PAPER,    FTBERS. 

30.  Prices  of,  rubber  and  rubber  prod- 
ucts. 

81.  Prices  of  paper. 
32.  Prices  of  fibers  and  tiber  products. 


METALS 

33.  Prices  of  iron,  steel,  and  their  prod- 

ucts. 

34.  Prices    of    ferroalloys,    nonferrons 

and  rare  metals. 

FUELS. 

35.  Prices  of  coal  and  coke. 

36.  Prices  of  petroleum  and  its  prod- 

ucts. 

37.  Prices  of  matches. 

BUILDING    MATERIALS. 

38.  Prices  of  clay  products. 

39.  Prices  of  sand  and  gravel. 

40.  Prices  of  quarry  products. 

41.  Prices  of  cement. 

42.  Prices  of  glass. 

43.  Prices  of  lumber. 

44.  Prices  of  j mints  and  varnishes. 

CHEMICALS. 

45.  Prices  of  mineral  acids. 

46.  Prices  of  heavy  chemicals. 

47.  Prices   of  miscellaneous  inorganic 

chemicals. 

48.  Prices  of  fertilizers. 

49.  Prices  of  soaps  and  glycerin. 

50.  Prices  of  essential  oils,   flavoring 

and  perfumery  materials. 

51.  Prices    of    wood-distillation    prod- 

ucts, and  naval  stores. 

52.  Prices    of    natural    dyestuffs    and 

tanning  chemicals. 

53.  Prices  of  coal-tar  crudes,  intermedi- 

ates, and  dyes. 

54.  Prices    of    drugs    and    pharmaceu- 

ticals. 

55.  Prices  of  proprietary  preparations. 

56.  Prices  of  explosives. 

57.  Prices    of    miscellaneous     organic 

chemicals. 


Copies  of  the  above  bulletins  may  be  obtained  at  a  nominal  price  from  the 
Superintendent  of  Documents,  Government  Printing  Office,  Washington,  D.  C. 
834 


14  DAY  USE 

RETURN  TO  DESK  FROM  WHICH  BORROWED 

LOAN  DEPT. 

This  book  is  due  on  the  last  date  stamped  below,  or 


on  the  date  to  which  renewed. 
Renewed  books  are  subject  to  immediate  recall. 

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